Economic Optimism Increases Across Minnesota

Half of Minnesota businesses expect the state economy to improve in the quarter that ends in late May-and 40 percent plan to increase headcount during that period, according to Twin Cities Business' quarterly economic indicator survey.

Fifty percent of Minnesota businesses recently polled expect the state's economy to improve in the quarter ending May 30-up from 39 percent in the previous quarter, and double the percent that voiced such optimism only six months ago, according to Twin Cities Business's quarterly economic indicator survey.

Of 888 businesses from across the state participating in the survey, 49 percent also said they thought national and international economic conditions would improve this quarter, up from only 32 percent that expressed such views about the first quarter of 2012.

The increased optimism comes as Minnesota businesses invest more in their operations. Planned investments in capital outlays and research and development have risen in each of the last three quarterly surveys. For the current quarter, 38 percent of Minnesota businesses plan to increase their capital outlays, while 28 percent plan to boost research and development spending.

Optimism in the economy also continues to stimulate hiring. The survey found that 40 percent of responding businesses plan to add to their full-time employment levels this quarter-up from 37 percent that planned to increase headcount during the first quarter, and 29 percent during the last quarter of 2011.

The only troubling sign from the survey is that 29 percent of respondents expect it to be more difficult this quarter to find qualified talent. This marks the third consecutive quarterly increase in the percentage of companies expressing concerns on this issue.

Additional information from the survey-including a list of Minnesota industries most actively hiring this quarter-can be found in May's edition of Twin Cities Business, online now at TCBmag.com.

Twin Cities Business conducts this independent survey quarterly to provide a look at business planning and sentiment among leaders across all industries in Minnesota. It is the only survey of its kind in Minnesota.