Manufacturing shows moderate growth. Tourism is the weakest sector, continuing a pattern set earlier in 1996. Labor scarcity continues as the most-cited problem confronting businesses in the district. Reports of increases in pay or benefits to attract entry-level workers or skilled technical specialists remain frequent, but many employers say there is no generalized upward pressure on compensation. Notwithstanding reports of compensation increases for entry-level and certain specialist employees, there are few reports of increases in the prices for goods and services.
Petroleum products are one exception.
Increased fuel prices are cited as a major cost increase for trucking firms and a Minnesota-based airline. One Minnesota chemical product manufacturer cites increases in the cost of all chemicals derived from petroleum or natural gas or whose production is energy intensive. At the consumer level, milk prices increased sharply from late September into November, but farm level milk prices were falling sharply in late November, and retail prices are expected to follow shortly. The 'nuclear winter' is over in downtown St. Paul commercial real estate market. Reports such as this are widespread, revealing a construction and real estate sector that still has stamina after four years of expansion.