Minnesota Secretary Of State - Fourth Quarter Business Conditions Report Shows Mixed Economic Indicators Across Minnesota
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Fourth Quarter Business Conditions Report Shows Mixed Economic Indicators Across Minnesota

April 6, 2018

Further employment gains expected in 2018

Economic growth should remain steady

SAINT PAUL — Minnesota labor markets performed strongly in the last quarter of 2017, though overall leading economic indicators (LEI) were mixed across the state. Leading indicators in 2017 rose in four of six regions, with Northern Minnesota showing slight declines, according to new economic reviews and forecasts released today by Secretary of State Steve Simon and the St. Cloud State University School of Public Affairs Research Institute.

The 2017 fourth quarter Minnesota Regional Economic and Business Conditions Reports predict all six regional planning areas will experience steady economic growth in the coming months. Household employment in Q4 was up year-over-year in every planning area. There were 14,801 new business filings across Minnesota in Q4, an increase of more than 10 percent year-over-year. To view each region’s full report online, click here.

“Leading indicators were mixed, with three regions rising and three falling for the last quarter of 2017,” said King Banaian, dean of the School of Public Affairs at St. Cloud State University and co-author of the reports. “Over the year leading indicators rose in four of six regions, with only Northeast and Northwest Minnesota showing slight declines. Labor markets performed strongly. Business filings for new corporations and LLCs were up more than 13% in Central Minnesota and the Twin Cities, raising possibilities of further employment gains in 2018.”

Nearly 60 percent of new business filers in all six planning areas completed the voluntary Minnesota Business Snapshot (MBS) survey. MBS is a new initiative designed to better serve Minnesotans and advance economic development by using voluntary survey information from Minnesota businesses, such as whether they self-identify as a member of specific communities, including veterans, women, or communities of color; the industry or field in which the business operates; or how many full-time employees they have.

“I am always looking for new ways to better serve Minnesotans and our business community,” said Secretary Simon. “I am grateful to the nearly 60 percent of new business filers who are participating in the Minnesota Business Snapshot survey. This tool, along with the regional economic reports, are vital data points for employers and residents alike. Thank you to our partners at Saint Cloud State University for compiling and interpreting this data, as well as the thousands of business owners who work with my office on this and many other projects.”

The reports were developed by the St. Cloud State University School of Public Affairs Research Institute, as part of its ongoing partnership with the Office of the Minnesota Secretary of State. The Secretary of State’s Office reviews and approves all Minnesota business filings, and commissioned the reports to provide a perspective on business conditions and deliver a tool for entrepreneurs to better understand their region. There is one quarterly report for each of six statewide planning areas. The economic reviews and forecasts are based on a comprehensive examination of several datasets, including business filings.

Twin Cities
Economic growth in the Twin Cities is expected to remain steady over the next several months, as economic fundamentals remain strong in the metro area. The Twin Cities Index of Leading Economic Indicators (LEI) fell 3.07 points in the fourth quarter. Three of five index components decreased in the fourth quarter, with a reduction in the number of residential building permits having the greatest impact.

There were 10,466 new business filings with the Office of the Minnesota Secretary of State in the seven-county metro area in the fourth quarter of 2017 — representing a 12.4 percent increase from one year ago.

Fifty-nine percent of new business filers in the Twin Cities planning area completed the voluntary Minnesota Business Snapshot (MBS) survey in the fourth quarter. Results of this voluntary survey indicate that more than 15 percent of new filers come from communities of color; about 5.1 percent from veterans; more than two percent from the disability community; and 9.4 percent from the immigrant community. Thirty-seven percent of new business filings in the Twin Cities planning area were initiated by women.

Employment increased by 3.8 percent over the year ending December 2017. The regional unemployment rate was 2.7 percent in December, considerably lower than one year earlier.

Central
Central Minnesota is expected to experience continued economic growth over the next several months, according to a variety of economic indicators. The Central Minnesota LEI rose by 3.32 points in the fourth quarter. Increased St. Cloud area residential building permits contributed to the quarter’s rising LEI.

There were 1,331 new business filings with the Office of the Minnesota Secretary of State in Central Minnesota in the fourth quarter of 2017 — representing a four percent increase from one year ago.

Sixty-three percent of new business filers in the Central Minnesota planning area completed the voluntary Minnesota Business Snapshot (MBS) survey in Q4. Results of this voluntary survey indicate that about 4.9 percent of new filers come from communities of color; about 7.8 percent from veterans; about 2.5 percent from the disability community; and 4.2 percent of new filings were made by the immigrant community. Thirty-eight percent of new business filings in Central Minnesota were initiated by women.

Employment increased by 3.3 percent over the year ending December 2017. The regional unemployment rate was 4.0 percent in December, with initial claims for unemployment down 9.3 percent from one year ago.

Northeast
Steady economic growth in Northeast Minnesota is expected over the next several months, according to a variety of economic indicators. The Northeast Minnesota LEI was flat in the fourth quarter, with two of the five components, led by a surge in Duluth-area building permits, experiencing an increase.

There were 507 new business filings with the Office of the Minnesota Secretary of State in Northeast Minnesota in the third quarter of 2017 — representing a 2.2 percent increase from one year ago.

Sixty-six percent of new business filers in the Northeast Minnesota planning area completed the voluntary Minnesota Business Snapshot (MBS) survey in this year’s fourth quarter. Results of this survey indicate that about three percent of new filers come from communities of color; 7.8 percent from veterans; about three percent from the disability community; and less than 1 percent from the immigrant community. Forty-four percent of new business filings in Northeast Minnesota were initiated by women.

Employment was 2.9 percent higher than year ago levels in December. The regional unemployment rate was five percent, considerably lower than one year ago. Initial claims for unemployment insurance were down 18.2 percent from one year ago.

Northwest
Northwest Minnesota’s economy is expected to experience steady economic growth over the next several months, according to a variety of economic indicators. The Northwest Minnesota LEI rose by 3.03 points in the fourth quarter, as three of the five components of the leading index increased.

There were 1,033 new business filings with the Office of the Minnesota Secretary of State in Northwest Minnesota in the fourth quarter of 2017 — representing a 7.8 percent increase from one year ago.

Sixty percent of new business filers in the Northwest Minnesota planning area completed the voluntary Minnesota Business Snapshot (MBS) survey in this year’s fourth quarter. Results of this survey indicate that about 4.3 percent of new filers come from communities of color; 7.6 percent from veterans; about 1.6 percent from the disability community; and 2.3 percent from the immigrant community. Forty-two percent of new business filings in Northwest Minnesota were initiated by women.

Employment increased by 2.2 percent over the year ending December 2017. The regional unemployment rate was five percent in December, which was considerably lower than the 5.8 percent rate observed one year ago. Initial claims for unemployment insurance were down 28.3 percent from one year ago.

Southeast
Southeast Minnesota’s economy is expected to see steady growth over the next several months, according to a variety of economic indicators. After two consecutive declines in the LEI, the fourth quarter index rose 1.18 percent.

There were 844 new business filings with the Office of the Minnesota Secretary of State in Southeast Minnesota in the fourth quarter — representing a 5.8 percent increase from one year ago.

Fifty-nine percent of new business filers in the Southeast Minnesota planning area completed the voluntary Minnesota Business Snapshot (MBS) survey in this year’s fourth quarter. Results of this survey indicate that 7.8 percent of new filers come from communities of color; 8.2 percent from veterans; 1.4 percent of new filers come from the disability community; and 4.8 percent from the immigrant community. Forty-two percent of new business filings in Southeast Minnesota were initiated by women.

Employment increased by 2.3 percent over the year ending December 2017. The regional unemployment rate was 2.9 percent in December, considerably lower than the 3.6 percent level recorded in the year earlier period.

Southwest
Despite a negative reading of the Q4 LEI, economic fundamentals are strong. Southwest Minnesota’s economy is expected to see steady economic growth over the next several months. The Southwest Minnesota LEI decreased by 7.05 points in the fourth quarter, with a recent rise in initial jobless claims in the region having the largest negative impact.

There were 620 new business filings with the Office of the Minnesota Secretary of State in Southwest Minnesota in the fourth quarter — representing 2.1 percent more new filings than one year ago.

Fifty-six percent of new business filers in the Southwest Minnesota planning area completed the voluntary Minnesota Business Snapshot (MBS) survey in this year’s fourth quarter. Results of this voluntary survey indicate that 3.8 percent of new filers come from communities of color; about 8.1 percent from veterans; about 1.2 percent from the disability community; and about 1.4 percent from the immigrant community. Forty-two percent of new business filings in Southwest Minnesota were initiated by women.

Employment increased by 1.1 percent over the year ending December 2017. The regional unemployment rate was 3.5 percent in December, a decrease from its 4.2 percent reading in December 2016.


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