In its latest economic forecast, the Federal Reserve Bank of Minneapolis said the U.S. recession will continue through 2009 with higher unemployment but also a rise in income and in housing units for the Ninth District.
Toby Madden, regional economist in Minneapolis, said non-farm employment will continue to fall throughout the area which includes Minnesota, Montana, North Dakota, South Dakota, northwestern Wisconsin and the Upper Peninsula in Michigan.
North Dakota will see a rise of 1.1 percent in employment while the largest drop, 6 percent, is the forecast in Upper Peninsula. Wisconsin follows with a drop of 3.2 percent, South Dakota drops 2.6 percent, Minnesota drops 2.3 percent and Montana is at 0.5 percent.
By the end of 2009, unemployment rate will climb to 14 percent for the Upper Peninsula, 7.8 percent for Minnesota, 6.9 percent for Wisconsin, 5.8 percent in Montana, 4.4 percent in North Dakota and 4.2 percent in South Dakota, said Madden.
Increase in Personal Income, Housing
Personal income will rise slightly in 2009 but more than in 2008 even as more of the aging population receives Social Security checks.
However, in North Dakota, personal income will fall 15.8 percent, which is attributed to the state’s volatile energy and agricultural sectors.
Housing starts will increase in all parts of the Ninth District with Minnesota leading the way at 103 percent rise by the end of 2009 to 8,700 units from the fourth quarter of 2008.
Predicted increases for the remaining states are Montana (18.1 percent), Wisconsin (10 percent), North Dakota (4.4 percent), and South Dakota (4.1 percent).
The large percentages in housing starts from a very slow residential construction market at the end of 2008.