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Appendix G: Economic Data (cont.) <br />~^~~.~.. <br />Id~YY FZ~i~~~ <br />FOR IMMEDIATE RELEASE <br />Contacts: Patti Lorenzen <br />612-204-5261 <br />oatti.lorenzen(cDmols.frb.ora <br />Toby Madden <br />612-204-5372 <br />tobv. maddenCalm ols.frb.ora <br />Date: March 10, 2005 <br />Minneapolis Fed survey finds manufacturers optimistic <br />MINNEAPOLIS, March 10, 2005-Upper Midwest manufacturers anticipate stronger activity <br />for their companies and are hoping for healthier profits in the first half of the year, <br />according to a winter survey of manufacturers conducted by the Federal Reserve Bank of <br />Minneapolis and the Minnesota Department of Employment and Economic Development. <br />Production and new orders are expected to jump. "To meet the expected increased demand, <br />companies plan to aggressively hire employees and increase productivity through capital <br />investments, which would result in an anticipated slight increase in profits," noted Toby <br />Madden, regional economist at the Minneapolis Fed. He cautioned that price increases for <br />raw materials and parts continue to be a concern. <br />Following are selected results of the expected growth in the first half of 2005 for Ninth <br />District states: <br />• 73 percent of the respondents from the Upper Peninsula of Michigan forecast <br />increased capital investment. <br />• 41 percent of Minnesota respondents expect production to increase. Only 14 percent <br />expect decreases. <br />• 56 percent of Montana respondents see larger orders. <br />65 percent of North Dakota respondents are looking for increased productivity. <br />• 40 percent of South Dakota respondents forecast increased employment and only 3 <br />percent anticipate decreases. <br />• 44 percent of western Wisconsin respondents expect prices on their products to <br />increase. Only 7 percent expect decreases. <br />This outlook is reflective of their experiences in the second half of 2004. While <br />manufacturers were busy during the last two quarters of 2004, the bottom line didn't have <br />much to show for it. Survey respondents reported that new orders, production, investment <br />in equipment, employment, productivity and prices were up during the last half of 2004. <br />This strength appears widespread across the <br />six-state district and in businesses of all sizes. Profits, however, were anemic as <br />respondents from Minnesota and Montana indicated decreases in profits and manufacturers <br />from other district states reported only small increases. <br />Gv <br />