Wednesday, June 10, 2009
Services sector activity decreased overall since the last report. Preliminary results of the Minneapolis Fed's annual survey of professional services companies in May showed decreased levels of sales revenue, employment and profits from a year ago; profits are expected to fall further over the next year. Respondents indicated that labor is more available, but input costs are increasing.Usually strong health care sector in Minnesota is also experiencing weakness:
In Minnesota, a medical devices firm recently announced plans to eliminate 600 jobs by the end of June, and a cabinetmaker laid off 200 employees during the first few months of 2009. Two health care providers in Minnesota recently announced plans to cut 240 and 100 jobs, respectively. Meanwhile, a Minnesota hospital will eliminate 75 to 100 positions by the end of June.One big plus: Compared to a year ago, gasoline in Minnesota was $1.38 cheaper in May. A smaller plus is an increase in "staycationing", with reservations at campgrounds this summer a bit up. The district is said to have "moderating contraction", which is like saying the Vikings improved because they only lost to the Bears by ten points as opposed to 24 the last time they played.