Editorial: Gas cost is factor in slow economy
The U.S. economy slowed in May due to rising energy costs and continued employment challenges, but the Upper Midwest followed the national trend to a lesser extent. The same holds true in west central Minnesota.
When gasoline at the local gas pumps drew near $4 per gallon at the beginning of May, consumers reacted. They had to find ways to cover that additional cost wherever they can. That means they have to save elsewhere, less eating out and delaying purchases.
Fortunately, the gasoline prices have eased slightly with the arrival of June.
The national economy was also affected by the recent Japan earthquake, which disrupted both auto production as well as sales.
The earthquake also had an impact on electronics production and sales.
In the Midwest, retail and manufacturing sectors remain strong or improving, according to a Federal Reserve report Wednesday.
Housing remains a weakness across the U.S. and in the Midwest. However, west central Minnesota Realtors are reporting "more interest" and are predicting a good summer in local housing sales.
Realtors believe that the pent-up demand is beginning to emerge as people recover their confidence in the economy.
The reality is that the economy -- both nationally and regionally -- is a complicated animal. Various reports say different things at different times.
The important thing is for west central Minnesota to focus on the critical issues and be ready for when the economy picks up its growth rate.