Economic report is upbeat

Monday, January 10, 2011

Photo of Rich MacDonald, economist

Rich MacDonald, economics professor and co-author of the St. Cloud Area Quarterly Business Report. Photo by Neil Andersen for University Communications.

Photo of Rich MacDonald, economist Photo of King Banaian, economist 

The Central Minnesota economy is improving, but remains weak, according to the St. Cloud Area Quarterly Business Report. 

The January 2011 report (PDF), authored by St. Cloud State economists Rich MacDonald and King Banaian, notes that while "overall employment gains in the private sector remain weak, other labor market indicators are among the best that have been seen for more than two years."

Eighty-six area firms responded to the January survey. 

Key report findings:

  • Recent ups and downs in the St. Cloud Area Index of Leading Economic Indicators (PDF) reveal the uneven nature of the economic recovery.
  • It may take years for the area labor market to return to pre-recession employment levels. October 2010 area private sector employment was 83,519, 5,500 jobs fewer than in October 2007.
  • Forty-one percent of surveyed firms report an increase in economic activity over the past three months. A year ago that number was 34 percent.
  • The report's Probability of Recession Index (PRI) fell below 50 percent in October, with a reading of 48.3 percent. The recession's end will be signaled when the PRI falls below 40 percent.
  • Fifty-six percent of the respondents expect conditions to improve six months from now, while 13 percent expect a decline in future business activity. January 2010 figures were 49 percent and 18 percent, respectively.
  • The St. Cloud Times' help-wanted ad lineage has rebounded nearly 28 percent from a year ago.

St. Cloud Area Quarterly Business Report is a joint venture of the St. Cloud Area Economic Development Partnership, Times Media and these St. Cloud State entities: Center for Economic Education, Department of Economics and the Social Science Research Institute.

The report is published in ROI Central Minnesota, a Times Media publication.

MacDonald's doctorate is from Binghamton University, State University of New York. Banaian holds a doctorate from Claremont Graduate School, Claremont, Calif.    

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