Twin Cities Minnesota Economic and Business Conditions Report
 

Publication Title

Twin Cities Minnesota Economic and Business Conditions Reports

Document Type

Research Study

Publication Date

1-4-2019

Abstract

Economic growth is expected to continue in the Twin Cities planning area according to the predictions of the Twin Cities Index of Leading Economic Indicators (LEI). The Twin Cities LEI increased 1.13 points in the second quarter of 2018 as two of five index components showed strength. Lower initial jobless claims and an improvement in the Federal Reserve Bank of Philadelphia Minnesota Leading Economic Indicators Index each contributed favorably to this quarter’s LEI. A decrease in the Minnesota Business Conditions Index—a general measure of statewide business conditions—and fewer residential building permits in the Twin Cities metropolitan area each had a negative impact on the Twin Cities LEI. There were 11,578 new business filings with the Office of the Minnesota Secretary of State in the seven-county metro area in the second quarter of 2018—representing a 6.9 percent increase from one year ago. 1,421 new regional business incorporations were tallied in the Twin Cities in the second quarter—3.7 percent fewer than year ago levels. Second quarter new LLC filings rose to 7,682 in the seven-county metro area—a 10.1 percent increase compared to the second quarter of 2017. New assumed names were 2.3 percent higher in the second quarter and there were 44 more new non- profit filings in the Twin Cities than one year ago. Sixty percent of new business filers in the Twin Cities planning area completed the voluntary Minnesota Business Snapshot (MBS) survey in this year’s second quarter. Results of this voluntary survey indicate that 15.4 percent of new filers come from communities of color. 5.8 percent of new filings are veterans. Two percent of new filers come from the disability community and 10.4 percent of new filings are made by the immigrant community. Thirty-five percent of new business filings in the Twin Cities planning area in this year’s second quarter were initiated by women. MBS results also show that most new business filers in the Twin Cities have between 0 and $10,000 in annual gross revenues (although 703 new filers have revenues in excess of $50,000). The most popular industries for new businesses in the Twin Cities are professional/scientific/technical, retail trade, real estate/rental/leasing, construction, and other services. Employment levels at most new firms are between 0 and 5 workers, and 43.2 percent of those starting a new business consider this a part-time activity. Twin Cities planning area employment increased by 2.5 percent over the year ending June 2018. At 2.8 percent, the planning area’s unemployment rate was considerably lower than one year earlier. Initial claims for unemployment insurance were lower than year ago levels, falling by 14 percent to 5,909. Average weekly wages in the region rose by 3.5 percent to $1,224 in the most recent reporting period. The planning area’s labor force expanded by 1.7 percent over the year ending June 2018. Average hourly earnings rose for private sector workers in the 16-county Minneapolis-St. Paul MSA over the year ending June 2018, but average weekly work hours declined. Annual bankruptcies continue to rise in the Twin Cities. The relative cost of living rose in both Minneapolis and St. Paul.

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