A Federal Reserve report shows hiring managers are slightly optimistic about the St. Louis region’s economic outlook for 2016.
In the Burgundy Book, released by the St. Louis Federal Reserve on Dec. 18, half of those surveyed said they expected to hire next year, though 21 percent thought the economy would worsen.
Farms experienced the shakiest developments, according to the report. From 2010 to 2014, the value of Illinois cropland increased 63 percent, though due to low crop prices and production, bankers surveyed by the Fed believe farmers will likely “experience net losses” and may not buy major capital improvements.
The St. Louis region experienced the largest growth in its transportation industry, which grew by 11.8 percent. In addition, the St. Louis region’s unemployment rate was 5.2 percent in the third quarter of 2015, the lowest since 2007.
The residential housing market also improved, though prices were below the national average. Industrial real estate markets also did well, especially in the metro-east.
“We’ve had a pretty good year,” said Joe Hardin, a broker at Barber Murphy Group, a real estate firm in Shiloh.
We’ve had a pretty good year.
Joe Hardin, broker at Barber Murphy Group
Hardin said he saw demand for investment properties, such as office buildings and apartments, which he said were currently offering better returns than stocks and bonds. One of the most successful locales has been Green Mount Road in O’Fallon, which has been “on fire” with development, he said, including the construction of two new hospitals, St. Elizabeth’s and Memorial Hospital.
Still, many in the metro-east are wondering about the effect of idling steel producer Granite City Works. The plant employs about 2,000 workers.
Mike Millsap, the director of the United Steelworkers district that covers Granite City, said most union members should receive about $440 a week in benefits for six months. If the idling continues longer than that, benefits would stop.
Millsap said he didn’t know exactly when the plant might open. He said it would be “whenever this country decides to do something about illegal imports (of Chinese steel).” Chinese steel has been cheaper in recent years due a slowdown in China’s domestic construction market, the International Business Times reported.
In an email commenting on the steel factory, St. Louis Fed economist Kevin Kliesen wrote, “Clearly, the immediate and most direct effects will be felt the most by those workers and the firm’s suppliers,” though, he noted, it is difficult to say how idling will affect the regional economy.
Granite City Works, which supplies the automotive and oil industries, would actually benefit from increased oil prices, Kliesen wrote.
On Thursday, however, it was reported that two more businesses were reporting plans to lay off workers.
Macy’s, the retailer, is cutting 750 jobs at a call center in Bridgeton, northwest of St. Louis.
And Monsanto, the agribusiness, also announced plans to cut 1,000 jobs, though it was unclear where. The company employs about 4,500 people in the St. Louis area.