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Two Hot Towns in
<br />The Snow Belt
<br />
<br /> MINNEAPOLIS-ST. PAUL
<br />Wheu Aim: Ruvelsol~ wnuls lO
<br />risk half a million dollars or so, he
<br />plunks it down right here--in the
<br />hind of high t~xes, Iow tempera-
<br />lures, foreclosed fitrms aud idle
<br />irOll milles.
<br /> Minuesota has all those things.
<br />But the Twin Cities Mso
<br />boast of ~ fine eduentionul sys-
<br />tem, ~ r~ft of high-leeh compa-
<br />nies "mM n bunch of nggressive
<br />venture capitalists," Io quote Ru-
<br />velson, president of First Mid-
<br />west Capital.
<br /> dob flenerators. The are~ to-
<br />day is popubr with venture e~pi-
<br />tMists. The top l~ risk-e~pitM
<br />companies here have un estimat-
<br />ed 370 million dollars under
<br />management.
<br /> That money creates jobs. In the
<br /> past l0 years, more than 600 new
<br /> manufacturers Slatted up in Min-
<br /> ncsola, accounting for ahnost
<br /> 300,000 jobs. "Thc entrepreneur-
<br /> ial spirit is alive aud weft here,"
<br /> says Dick Reid, a spokesman for
<br /> Conlrol Data, which from a con-
<br /> cept in 1957 grew to be thc state's
<br /> btgcst private employer. Control
<br /> Data, begun by people from Sper-
<br /> ry Univac, .has i~selg spawned
<br /> about 60 new companies, includ-
<br /> ing Cray Research, Data Card,
<br /> Network Systems and Dala 100.
<br /> Although Minnesota's farming
<br /> and mining scclors remain dc-
<br /> pressed, nonfiirm employment
<br /> spurted 7 pcrcenl in the fourlh
<br /> quarter of 1984, and retail sales
<br /> surged 28 pcrccni. Mosl o[ lhat
<br /> growd~ occurred in thc qkvin Cit-
<br /> ies, where 1 out of 3 manufactur-
<br /> ing jobs is in high tech.
<br /> Beyond that, il~e Twin Cities
<br /> posted a 19 percent gain last year
<br /> in conslruction employment.
<br /> Both downtowns are thriving. St.
<br /> Paul alone has had more than-I
<br /> billion dollars' worth ot develop-
<br /> mcnt in the past seven years.
<br /> Growth is cxpccied to continue.
<br /> The Mimmapolis Federal Reserve
<br /> Bank expccts retail sales to
<br /> crease 8.5 percent this year and
<br /> nmffarm employment in Minne-
<br /> sot~ to rise aboot 5.7 percent--
<br /> meaning some 100,000 new jobs.
<br /> That's not bad, here in the heart
<br /> II~e snow belt.
<br />
<br />By MICHAEL BOSC
<br />
<br />54
<br />
<br />mcnt spots inside ils spiraling tower
<br />and II-aero train shed.
<br /> Nol Illllliy ~tllldav neWSlmpers [rolu
<br />Ihmshm and J)allas ~re sold in Detroit
<br />n,wa&,ys. Job opeuinRs once adver-
<br />lised in 'lVxas are lar lewer, and the
<br />
<br />I)rOSl)erity nol h'll since 1979.
<br /> The joke in llouslon
<br />'85, or it's (;hapler
<br />Rone are days of intense growth, llous-
<br />IDa now has a ~0 percent vacancy rate
<br />in shopping centers and downtown of-
<br />flee huihlings. "L,w energy prices help
<br />the rest of the country, but tliey don't
<br />do much for us," remarks p]mmer J. D,
<br />Guy oF I louston Lighting & Power.
<br /> llas the energy capital oF the South-
<br />west bottomed outP Business leaders
<br />are hopeful. Easter sales were brisk.
<br />Bank deposits are up. Oil-service firms
<br />sueb as Rowan Companies and Cmner-
<br />on Iron Works are making money again.
<br /> Dallas-Fort Worth and San Antonio
<br /> don't share these miseries with Ilous-
<br /> ton. A huge military payroll, an expand-
<br /> lng medical center and a brisk tourist
<br /> trade, buoy San Antonio. Defense dol-
<br /> htrs add thousands ofjohs in Dallas and
<br /> neighboring Fort Worth. EFV's de-
<br /> fense-related employmenl is up 20 per-
<br /> cent [rOlll a year ago. Bell Ilelieopter's
<br /> work force is up 11 percent. Yet ~bxas
<br /> bauks still reel from bad energy loans,
<br /> aud ofliee space in Dallas is overbuilt.
<br /> "Our margins are being squeezed," says
<br /> developer William Criswell.
<br />
<br /> West: Strong and Steady
<br /> Phoenix remains in the midst of a
<br /> boom that economist Elliott Pollack of
<br /> Valley National Bank calls "mind bog-
<br /> glint." The metro area, with a pol~ula-
<br /> tion of 1.8 million, absorbed 90,000
<br /> the 130,0OO persons who moved to Ari-
<br /> zona iu 1984. Remarks Pollack: "As
<br /> long as the U.S. is doing well, we will
<br /> do betler.' No fewer than 35 nexv
<br /> shopping eeuters are in the works.
<br /> I~os Angeles is on its own hot streak.
<br /> At last word, the area's jobless rate was
<br /> 6.5 percent, down from 7.9 percent
<br /> year earlier. Across-the-lxmrd, business
<br /> is prospering. "It has not been the soper-
<br /> heated boom of 1977-79," sttys David
<br /> Anderson, president of General qble-
<br /> phone of Californla. Instead, he calls this
<br /> "a period of good, steady growth."
<br /> The city's downtown bristles with
<br /> construction cranes. Eight sizable
<br /> buildiugs are set for completion within
<br /> 18 months. Retailing is brisk, and de-
<br /> fense contractors can hardly hire fast
<br /> euough. Rockwell International has
<br /> added ~,000 employes since January 1.
<br /> Norfl~rop put o, ],0O0 new workers
<br /> and says hundreds of specialized jobs
<br /> go unfilled, llughes Aircraft expects to
<br /> hire 3,600 in the area this year.
<br />
<br />Construction Is big business In Phoenix.
<br />
<br /> By comparison, the San Francisco
<br />econo,ny is less frenetic, though still
<br />improving. Because the 13ay area is ustl-
<br />ally recession resistant, it tends to lag
<br />behind Los Angeles'during expansions.
<br />In fact, since the recession year of 198~,
<br />office vacancies have risen from negli-
<br />gible levels to 10 percent. But few busi-
<br />ness leaders worry about the area'~ eeo-
<br />nmnie strength. Says Robert l layden
<br />the chamber of commerce: "The shift
<br />in U.S. trade Dom lhe'Athmtie to the
<br />Pacific can mean only ouc thing ior San
<br />Francisco~a large share."
<br /> Boise just ended one of the coldest
<br />winters in the history of that Idaho
<br />city. ~t retail sales and employme,t
<br />were both op. Reason: Boise is a "head-
<br />quarters city."
<br /> It's the state capital, for one tiring. A
<br /> clutch of big companies, including Al-
<br /> bertson's, Boise Cascade and Morrison
<br /> Knudsen call Boise home. qbgcthcr
<br /> with a sizable number of facilities of
<br /> other companies, the city has a broad,
<br /> stal)le employmcut base.
<br /> Like thc rest of Ihe Northwesl these
<br /> days, Boise has its share of problems. It
<br /> struggles with downtown dcvelolm~ent
<br /> ~too much hind is still in parking lots.
<br /> One big employer, Micron q~chnulo-
<br /> gy, has htid off 40 percenl of its i,250
<br /> workers and may go 1o 50 percent.
<br /> But attorney Phillip Bather, presi-
<br /> dent of the chamber of commerce,
<br /> anything but dour. Just back from Iwo
<br /> days of'grotmdbrcakings and ribbm~
<br /> cuttings around town, he calls Boise
<br /> "healthy, with a moderate heartbeat."
<br /> As seen from the grass-roots level.
<br /> that description befits tt sizable and
<br /> growing number of American cities
<br /> the early months of 1985, as the good
<br /> ti~nes just keep rolling on.
<br />
<br />U.S.NEWS & WORLD REPORT, April 29. 198[
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