The State of the La Crosse / 7 Rivers Economy

Ronald A. WirtzRegional Outreach Director

Past Editor, fedgazette

minneapolisfed.org

DisclaimerThe views expressed here are the presenter's and not necessarily those of the Federal Reserve Bank of Minneapolis or the Federal Reserve System.

Federal Reserve System• The central bank of the U.S. (est. 1913)• Regulates banks, manages (‘clears’) financial payments,

and sets monetary policy (e.g., interest rates via FOMC)• 12 district banks nationwide track regional economies

Minneapolis Fed’s Ninth District

Our job is to understand this regional economy, including (and especially) its larger markets

“What is the state of the 7 Rivers region?”

• Implied question: Is the La Crosse / 7 Rivers economy performing well, or poorly?

Answer: “Yes”

• Complex topic: Subjective framing, objective measures

• The “answer” depends on … Choice of performance metrics Relative performance (peer comparisons) Timeframe

Some context: Recession in perspective

You decide the state of the region based on …

• a variety of economic indicators• tabulated over time• compared to similar, nearby metro regions• and also broken down by county in the 14-county region

Rochester La Crosse Eau Claire Dubuque United States0%

4%

8%

12%

16%

20%

Real GDP growth Percent change, pre- and post-re-

cession to 2014Pre-recession: 2007 to 2014

Post-recession: 2009 to 2014

Source: Bureau of Economic Analysis

La Crosse Dubuque Eau Claire Rochester-20%

-10%

0%

10%

20%

30%

40%

GDP by industry sector2009 to 2014

Finance, insurance, real estate, rental, and leasing

Manufacturing

Construction

Retail

Educational services, health care, and social assistance

Information

Professional and business services

Arts, entertainment, recreation, accommodation, and food services

Source: Bureau of Economic Analysis

La Crosse Dubuque Eau Claire Rochester0

100

200

300

400

500

600

Single family housing permits

Source: U.S. Census Bureau

2009 to 2015 (August YTD for all years)

La Crosse Dubuque Eau Claire Rochester0

50

100

150

200

250

300

350

Multi-family housing permits

Source: U.S. Census Bureau

700+ units

2009 to 2015 (August YTD for all years)

Single-family Multi-family0

50

100

150

200

250

300La Crosse metro permits

2009 to 2015 (August YTD for all years)

Source: U.S. Census Bureau

Dubuque Eau Claire La Crosse Rochester U.S. 0%

2%

4%

6%

8%

$34,000

$38,000

$42,000

$46,000

$50,000

Real personal income

% change 2009 to 2013 (left axis)

Per capita personal income, 2013 (right axis)

Source: Bureau of Economic Analysis

20002001

20022003

20042005

20062007

20082009

20102011

20122013

20142015

0

1

2

3

4

5

6

7

8

9Unemployment rate

DubuqueEau ClaireLa CrosseRochester

Perc

ent

Source: Bureau of Labor Statistics

Dubuque Eau Claire La Crosse Rochester

-2%

0%

2%

4%

6%

8%

10%

Employment growthPre-recession growth: 2007 to 2015

Post-recession growth: 2009 to 2015

Source: Bureau of Labor Statistics

20002001

20022003

20042005

20062007

20082009

20102011

20122013

20142015

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

Civilian labor lorce not growingHave or seeking a job, at least 16

years old, not serving in military or institutionalized

RochesterEau ClaireLa CrosseDubuque

Source: Bureau of Labor Statistics

Dubuque Eau Claire Rochester La Crosse-2%

-1%

0%

1%

2%

3%

4%

5%

6%

Civilian labor force Percent change, 2009 to 2015

Source: Bureau of Labor Statistics

Micro/county analysis:The 14-county, 7 Rivers region

• Buffalo• Crawford• Jackson• Juneau• La Crosse• Monroe• Richland

• Trempeleau• Vernon• Allamakee (IA)• Winneshiek (IA)• Fillmore (MN)• Houston (MN)• Winona (MN)

2010 2011 2012 2013 2014 2015140,000

144,000

148,000

152,000

156,000

160,000

164,000

Job growth in the 7-Rivers region(March of each year)

Source: Bureau of Labor Statistics

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015140,000

144,000

148,000

152,000

156,000

160,000

164,000

Job growth in the 7-Rivers region(March of each year)

+5.5%

-1.2%

Source: Bureau of Labor Statistics

Source: Bureau of Labor Statistics

Buffalo

Crawford

Winona

Monroe

Richlan

d

Fillm

ore

Allamak

ee

La Crosse

Winnesh

iek

Houston

Vernon

Jackso

n

Juneau

Trempele

au-30%

-25%

-20%

-15%

-10%

-5%

0%

5%

10%

15%

Job growth: Since end of recession(Annual March job figures)

Employment growth, 2010 to 2015

Buffalo

Crawford

Winona

Monroe

Richlan

d

Fillm

ore

Allamak

ee

La Crosse

Winnesh

iek

Houston

Vernon

Jackso

n

Juneau

Trempele

au-30%

-25%

-20%

-15%

-10%

-5%

0%

5%

10%

15%

-9.0%

-7.5%

-6.0%

-4.5%

-3.0%

-1.5%

0.0%

1.5%

3.0%

4.5%

Job growth: After the recession(Annual March job figures)

Unemployment rate, August 2015

Employment growth, 2010 to 2015

Source: Bureau of Labor Statistics

Buffalo

Crawford

Allamak

ee

Richlan

d

Houston

Winona

Monroe

Winnesh

iek

Juneau

Fillm

ore

Jackso

n

La Crosse

Vernon

Trempele

au-40%

-30%

-20%

-10%

0%

10%

20%

Job growth: Pre-recession to now(Annual March job figures)

Source: Bureau of Labor Statistics

Employment growth, 2008 to 2015

Buffalo

Crawford

Allamak

ee

Richlan

d

Houston

Winona

Monroe

Winnesh

iek

Juneau

Fillm

ore

Jackso

n

La Crosse

Vernon

Trempele

au-40%

-30%

-20%

-10%

0%

10%

20%

Job growth: Pre-recession to now(Annual March job figures)

Source: Bureau of Labor Statistics

Employment growth, 2008 to 2015Population growth, 2007 to 2014

Buffalo

Richlan

d

Vernon

Allamak

ee

Fillm

ore

LaCrosse

Houston

Winnesh

iek

Winona

Monroe

Juneau

Trempele

au

Crawford

Jackso

n-10%

-5%

0%

5%

10%

15%

Annual worker wages, 2009 to 2014Inflation adjusted

Source: Bureau of Labor Statistics

Buffalo

Richlan

d

Vernon

Allamak

ee

Fillm

ore

LaCrosse

Houston

Winnesh

iek

Winona

Monroe

Juneau

Trempele

au

Crawford

Jackso

n-10%

-5%

0%

5%

10%

15%

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

$45,000

Annual worker wages, 2009 to 2014

Inflation adjusted 2014 per capita in-come

Percent change in per capita income, 2009 to 2014

Source: Bureau of Labor Statistics

The outlook

• Minneapolis Fed annual forecast for 6 (partial) states in Ninth District

HousingPersonal incomeNonfarm employmentUnemployment

• New forecast for 2016 in early January

2015 forecast

2015 forecast

20042005

20062007

20082009

20102011

20122013

20144,000

4,500

5,000

5,500

6,000

6,500

7,000

Wisconsin establishments: Openings and closings

Rolling 4-quarter average

Openings

Closings

Source: Bureau of Labor StatisticsQtr1

2009 Qtr1

2010 Qtr1

2011 Qtr1

2012 Qtr1

2013 Qtr1

2014

0

2,000

4,000

6,000

8,000

10,000

Minnesota openings, closingsRolling 4-quarter average

Openings

Closings

$0

$5,000,000,000

$10,000,000,000

$15,000,000,000

$20,000,000,000

$25,000,000,000

Annual exports: WI vs. MN

Wisconsin

Minnesota

Source: WISERtrade

$0

$1,000,000,000

$2,000,000,000

$3,000,000,000

$4,000,000,000

$5,000,000,000

$6,000,000,000

$7,000,000,000

$8,000,000,000Top five Wis. export markets

CanadaEuropeMexicoChinaSouth America

Source: WISERtrade

2005 2006 2007 2008 2009 2010 2011 2012 2013$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

Farm income in 14-county area

Source: Bureau of Economic Analysis

2005Q1

2005Q3

2006Q1

2006Q3

2007Q1

2007Q3

2008Q1

2008Q3

2009Q1

2009Q3

2010Q1

2010Q3

2011Q1

2011Q3

2012Q1

2012Q3

2013Q1

2013Q3

2014Q1

2014Q3

2015Q10

50

100

150

200

250

300

Index: Quarterly farm income2005 = 100

Iowa

Minnesota

Wisconsin

Source: Bureau of Economic Analysis

La Crosse

Winona

Houston

Juneau

Monroe

Crawford

Richlan

d

Trempea

leau

Jackso

n

Fillm

ore

Buffalo

Vernon

Winnesh

iek

Allamak

ee0%

2%

4%

6%

8%

10%

Farm income as % of county GDP 2013

Source: Bureau of Economic Analysis

Looking for more?

fedgazette: Ninth District economy

The Region: Monetary policy, economic theory and new research

Website: minneapolisfed.org• President speeches on monetary policy• Banking conditions• Econometric research• Ninth District data and more

Minneapolis Fed outreachWe want more feedback on economic conditions from business owners and executives in the Ninth District.

• Looking for business contacts willing to take periodic surveys or provide one-on-one feedback (email, phone)

• Confidential, and helps inform monetary policy

If interested, contact me!• ron.wirtz@mpls.frb.org• 612.204.5262

Thank you!

Questions?

Twitter: @RonWirtz@fedgazette

@MinneapolisFed