CWERB - Stevens Point Area 1st Quarter 1987

The Stevens Point area economy grew dramatically from first quarter 1986. The unemployment rate dropped by a full percentage point to 8.3 percent. This is the lowest unemployment rate in Central Wisconsin. Total employment grew by a healthy 3.6 percent, thus creating a gain of over 1000 positions. Further evidence is given by total nonfarm employment which experienced an increase of 2.7 percent. Moreover, the' strength of the local economy was transmitted to public assistance and unemployment claims for the county. For each measure of distress, substantial decreases were recorded. Bank lending activity and consumer spending were higher than in first quarter 1986. Finally, the retailer confidence index indicated that store activity surpassed that of last year. The forecast is that the local area economy will continue to expand if no major external shocks occur. The reason for the optimism is based upon the following. First, several key industry groups should have a profitable year in 1987. Second, regional business leaders remain confident about the future of their industries and the local economy. Third, the outlook of retailers is for increased spending. Fourth, help wanted advertising remains quite strong. Fifth, residential construction experienced a very good first quarter. However, this may be more a result of the mild winter weather than improved economic conditions.

Portage County employment by major industrial classification is presented in Table 7. Overall nonfarm employment increased by 640 positions or 2.7 percent from last year. Manufacturing posted a 5.5 percent increase. This is the first time in a year that this sector has shown signs of growth. Services was the only sector to record a contraction in employment. The first preliminary estimates indicate that employment contracted by 5.1 percent. Trade remained unchanged from last year, while construction increased by 50 percent. The mild winter, favorable interest rates, and an improved local economy were the major factors behind the surge in construction activities. Government employment in March remained significantly above the level recorded last year. Thus, the increase reported in fourth quarter 1986 was not a temporary event.

The retailer confidence index for Stevens Point is given in Table 8. The business community is generally more optimistic about future conditions than last quarter. When asked to compare total sales and store traffic to a year ago, the response levels were approximately in the same range as last quarter. However, this response level still falls into the "somewhat improved" category. Substantial optimism was expressed for expected sales and store traffic three months from now. The level of optimism for expected sales is the highest recorded for any period during the past year.

The help wanted advertising index is displayed in Table 9. This index is used to measure local labor demand and the trend in future employment. The index is 33 points higher than the base period of 1980. In other words, there are one-third more jobs being advertised. This is the fifth consecutive quarter that the index has been above last year's levels. Thus one can say that expansion in the local economy is not over.

Table 10 gives data pertaining to the level of several types of public assistance being distributed in the county. The table provides a measure of local family financial distress. New applications are substantially lower than in first quarter 1986. Moreover, the total caseload has contracted by 3.4 percent from a year ago. Thus, the data indicates that the economy has strengthened and especially so during the last quarter. Table 11 presents another measure of economic performance and family financial distress. Unemployment claims have declined sharply from last year. The 24.2 percent decline is a welcome sign after having increased for the past several quarters. This decrease is a reflection of a growing local economy.

Table 12 contains residential construction data for the area. This data covers the towns of Hull, Stockton, Sharon, and Plover; Stevens Point and the village of Plover. The data demonstrates that the residential construction scene was "booming" during the first quarter of the year. All categories, except the number of residential alteration permits, were greatly above levels established last year. The vitality of this leading economic indicator foretells a multiplier effect on the local economy and further expansion.

Nonresidential construction in the greater Stevens Point area presents a mixed picture. Data in Table 13 shows that the number of permits issued was unchanged from last year. Moreover, the number of business alteration permits and their value was below last year's levels. Only the estimated value of new structures increased. The major source of the estimated value of new structures resulted from the construction of the new Citizens Marine facility.

The financial statistics for Portage County are listed in Table 14. Bank deposits contracted by 2.7 percent from last year which is indicative of increased purchasing on the part of consumers, e.g. housing. This represents the first time since 1982 that deposits have contracted locally. Bank loans were up by 6.7 percent, reflecting the continued expansion of local economic activity. It should be noted that the loan figures are understated by an amount equal to the dollar amount of loans resold in the after market.