Business owners of St. Clouds are upbeat about business in the new year, although some signs remain that activity may be slow in the coming months, a new report has found.
Economics professors of the State University of St. Cloud, King Banaian and Mana Komai Molle presented the findings of the St. Louis Area Quarterly Business Report. Cloud to an audience of business owners and other professionals Thursday night at Pantown Brewing.
The survey asks business owners in the St. Cloud area about the costs of running their business, employee retention and thoughts on future conditions.
The latest report found that 55% of respondents anticipate increased business activity over the coming months, but at the same time, many are concerned about activity nationally.
“We have optimism set at the highest level, but we don’t see anything that shows a continuation in action that comes with what you would think would happen if you thought everything in 2025 was going to be great.” Banaian said.
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At the same time, many business leaders expressed concern about the costs of running their businesses. For 69% of respondents, input and labor prices exceeded their output, hurting profit margins.
Businesses are also still struggling with employees who have become more selective about the positions they accept, emphasizing retention as an important company strategy, Komai Molle said.
“In the job market in St. Cloud, you have wage growth, you have flexible work environments that are out there right now,” she said. “You can see that the job market is competitive and employers care about keeping their jobs.”
The two economists said their forecast for the next six months shows weak growth, with more earnings expected to go towards higher wages and input purchases. The area was also impacted last year with several closings of companies such as Oberg Roofing and Textron’s Arctic Cat.
Meanwhile, the stock market index in St. Companies like Knife River and Quanta Systems saw big profits, while New Flyer struggled, he said.
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Banaian also said the local stock market index will become more difficult to use as companies move out of the area, such as the vacant Capital One space in downtown St. Louis. Cloud.
“We have a stock market index that we use for local businesses, which is getting really challenging lately because we continue to have fewer and fewer publicly traded businesses in our area,” he said.
Going forward, Banaian and Komai Molle said it may be a waiting game to see how the results of the new state and federal legislative sessions may affect area business owners. It remains unclear how permanent the economic changes associated with the pandemic will be.
The St. Cloud area must also address its housing needs, the two said, if it wants to continue to provide a workforce. The rate of new housing construction around St. Cloud has recently slowed, with about 25 fewer building permits in 2024 compared to 2023.
The area is now growing more slowly than cities like Mankato or Rochester, which Banaian said could affect future workforce growth.
“If you want our economy to grow, you need more jobs,” he said. “We’re asking ourselves, are we actually building the right number of homes for this?”
New St. John’s Area Quarterly Business Report will be published on the SCSU website at a later date.
Teagan King covers business and development for St. Cloud Times. She can be reached at teking@gannett.com.
