Northwest Minnesota business conditions are expected to slow over the next several months according to the predictions of the St. Cloud State University (SCSU) Northwest Minnesota Index of Leading Economic Indicators (LEI). An improvement in consumer sentiment and a small gain in a general measure of rural economic health contributed favorably to the fourth quarter LEI. A fall in new incorporations and limited liability companies (LLCs) as well as recent increases in initial jobless claims and a decline in residential building permits earlier in 2014 in Northwest Minnesota’s metropolitan areas had a negative influence on the leading index. The SCSU Northwest Minnesota Index of Leading Economic Indicators decreased 1.31 points in the fourth quarter.
There were 863 new business filings with the Office of the Minnesota Secretary of State in Northwest Minnesota in the fourth quarter of 2014 — representing a 1.1 percent decline from one year earlier. Ninety-one new regional businesses were incorporated in the fourth quarter, an 11.7 percent reduction from the fourth quarter of 2013. Over the past twelve months, new LLC filings in Northwest Minnesota were up 1.7 percent—increasing to 475 in the fourth quarter of 2014. New assumed names totaled 263 — an increase of 8.2 percent over the fourth quarter of 2013. There were 34 new filings for Northwest Minnesota non-profits in the fourth quarter—43.3 percent fewer filings than one year earlier.
Employment of Northwest Minnesota residents increased by 2.9 percent over the year ending December 2014. The regional unemployment rate was 4.9 percent in December, an improvement on its 5.7 percent reading one year earlier. Initial claims for unemployment insurance in January 2015 were 200 more (an increase of 8.8 percent) than in January 2014. The regional labor force was 1.9 percent higher at the end of 2014 than it was one year earlier. The average weekly wage earned in Northwest Minnesota experienced an annual increase of 2.6 percent in the most recent reporting period.
The Fargo/Moorhead Metropolitan Statistical Area (MSA) experienced a strong fourth quarter. Employment, the unemployment rate, the labor force, residential building permits, average hourly earnings, and initial jobless claims were improved from December 2013. The only indicators exhibiting weakness were the length of the workweek and the area cost of living. The Grand Forks/East Grand Forks MSA also had a strong fourth quarter of 2014. Increased employment, a lower unemployment rate, an expanded labor force, lower initial jobless claims, and an increase in the length of the workweek contributed favorably to the regional outlook. A decline in regional residential building permits and a reduction in average hourly earnings were the only regional indicators that contributed unfavorably to the Grand Forks/ East Grand Forks economic outlook.
Banaian, King and MacDonald, Richard A., "Northwest Minnesota Economic and Business Conditions Report - Fourth Quarter 2014" (2015). Northwest Minnesota Economic and Business Conditions Report. 5.