The Federal Reserve released the Beige Book today, which is a summary of their comments on economic conditions. The report contains information related to each district, and there is some information specific to North Dakota mentioned in the Book. I am just highlighting a few of the more notable elements here. The link to the full report is above.
For construction the district had “modest” growth, but North and Source Dakota say nonresidential construction drop (IX-1). Fargo saw flat single-family home permit growth while it actually fell in Grand Forks. Other areas in the district saw better growth with Minneapolis-St. Paul units permitted increasing by 2% over year-ago levels(IX-1).
The energy sector fallout continued to hit western North Dakota. The report listed the decline in oil activity as a cause of very low occupancy rates in hotels(IX-2). This is not much of a surprise given the declines in employment in key communities like Williston.
Manufacturing in North Dakota declined, according to the report, but there was no separate mention of what led to this conclusion. I’m not doubting it, just saying.
The energy sector received some significant attention, and rightly so. The Beige Book specifically mentioned the 7% decline in oil production in March in North Dakota. They followed this discussion with some interesting developments in renewable energy resources in South Dakota, Montana, and Minnesota. As mentioned by me many times, mining activity was stable in the region, regularly born out in the coal production data.
Labor availability was an issue in the ninth district, similar to reports from much of the rest of the country, as reported in the Beige Book (IX-3). This was not leading to significant wage pressures though as there were reports of construction bids in the state coming in “under budget, thanks to an increase in bidders due to a construction slowdown in oil country(IX-3).”
In all, the conditions reported in the Beige Book seem to match well with the other data points I usually examine, labor force, employment, GDP and so on.
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