The Stevens Point area economy experienced a continuation of the expansion started earlier this year. However, the rate of growth was slower than the rate in previous quarters of 1987. The prognosis for the local scene remains positive, but the full effects of the stock market crash and the direction of the national economy will not be known for several quarters.

     The fact that the local area expanded albeit at a more modest rate than in previous quarters, can be supported by the following data. First, the unemployment rate is much below last year's level. Second, total employment is up by a modest 2.4%. Third, although the growth in nonfarm employment was flat, it was at least positive in nature. Fourth, retail sales were modestly better than a year ago. Fifth, public assistance and unemployment data show signs of improvement. Lastly, financial statistics conveyed the message that activity has expanded.

     Positive signs for the future come from the following local factors. Key local firms, such as Kimberly-Clark in Whiting and Sentry Insurance have announced changes that will add to their payrolls. Furthermore, the COPPS Corporation, and University of Wisconsin are adding to their physical facilities. Regional business leaders are more confident than last quarter about their industries. Retailers are optimistic. Finally, help wanted advertising remains essentially strong. This should translate into more jobs.

     Table 7 gives the results for fourth quarter 1987 employment in Portage County. Manufacturing continued to lead all sectors posting an increase of 400 jobs. Employment growth in all other nonfarm employment categories was either unchanged or slightly lower than last year. Overall, nonfarm payrolls were up by 150 positions or 0.6%. Thus, the data in Table 7 suggest a slowing of local economic growth during fourth quarter. This is consistent with national trends. The retailer confidence survey is presented in Table 8. Retailers indicated that store sales are slightly better than last year. However, it appears that sales in September were marginally better than in December. In contrast, the volume of store traffic in December was improved over September survey results. When asked about future sales and store traffic this group was just as optimistic as last quarter. In sum, fourth quarter 1987 retail activity, while improved over last year, was less than had been predicted by the retailers in the pre­stock market crash period of September.

     An indicator of labor demand for the Stevens Point area is given in Table 9. Conditions have improved over last year. In December 1987, 15.3% more jobs were being advertised than a year ago. As a matter of record, the 151 index level is' the highest ever recorded for the fourth quarter time frame. However, the 15.3% increase over the past year falls short of the 54.4% rise between December 1985 and 1986. Therefore, even though labor demand is substantially higher, the area has seen more impressive gains. This suggests that while the economy is poised to move forward the rate of increase will be somewhat slower in the quarters ahead.

     Good news comes from Table 10 and Table 11. While the number of new applications for public assistance remained virtually unchanged, the total caseload decreased by approximately 7.3%. Moreover, total unemployment claims have contracted by 29.2%. These lower measures of local financial distress are encouraging. However, the numbers also indicate that there are still individuals and families in our community who, for a variety of reasons, have not been able to participate in local economic prosperity.

     A very important leading economic indicator is residential construction. The data are presented in Table 12. The residential construction activity was significantly below last year's very robust performance. As a matter of fact, fourth quarter 1987 activity was at approximately the same level as fourth quarter 1985. Undoubtedly, the harsher weather of 1987, and uncertainty concerning the economy played a role in diminishing the results. At the national level, home construction and sales are also down from earlier levels.

     Nonresidential construction in Table 13 shows a number of new additions to the local capital stock. The large jump in the estimated value of business alterations is partially derived from large remodeling projects undertaken by the Road Star Inn, M&I First National Bank and COPPS. It should be noted that the singular nature of business construction causes wide fluctuations in the reported statistics.

     Financial statistics for Portage County are listed in Table 14. Bank deposits were up by approximately 2070 in fourth quarter reversing the situation of third quarter. Deposits, totaling $274.6 million, are at the highest level recorded regardless of quarter. Lending activity in the area rose by a healthy 10.0% to $171.9 million and stands at a near record level. The data indicate that fourth quarter economic expansion was respectable if not as spectacular as during the second and third quarters of this year.