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Oil industry still fueling a booming local economy

Posted 12/24/12 (Mon)

By Neal A. Shipman
Farmer Editor

The economic boom spurred by a continued strong energy sector is still going very strong in Watford City and McKenzie County according to the latest taxable sales information released by the North Dakota Tax Dept. The report shows that McKenzie County posted a 39.41 percent increase in taxable sales and purchases in the third quarter of 2012, while Watford City’s taxable sales and purchases increased by 46.70 percent during the same time frame.
The county’s taxable sales and purchases increased from $39,822,980 to $55,517,497 during the months of July, August and September from 2011 to 2012.
Likewise, business was booming in Watford City which saw its taxable sales grow from $34,029,752 in the third quarter of 2011 to $49,921,606 during the same three-month period in 2012.
Watford City’s taxable sales and purchases in the second quarter of 2012 put the city as No. 11 of the state’s 50 largest cities.
Of the state’s 53 counties, McKenzie County is now ranked No. 10 in taxable sales and purchases.
According to Tax Commissioner Cory Fong, statewide taxable sales and purchases made during July, August, and September 2012 were $6.735 billion, up $1.233 billion or 22.4 percent compared to the third quarter 2011.
“North Dakota continues to be a bright spot in the nation,” said Fong. “We have a record number of workers working in the state, a robust housing market, and strong land values, all contributing to upbeat consumer confidence as we entered the fourth quarter.”
Fong mentioned the recent news story featured by 24/7 Wall St, “The Cities Where Everyone Has a Job,” highlighting Bismarck, Fargo, and Grand Forks as the top three cities with the lowest unemployment rate in the nation.
Retail trade, the sector often looked to as a measurement of consumer confidence, continued to grow, reporting a gain of 13.1 percent compared to the same period for 2011. Wholesale trade, which reflects spending by businesses, reported gains of 30.7 percent. Inflation during the same time was 1.7 percent.
“North Dakota’s wholesale and retail trade sectors were strong performers in the third quarter, representing confidence among consumers and businesses as we entered the fourth quarter,” said Fong.
Thirteen of 15 industries reported growth during the third quarter of 2012. The utilities sector reported the largest percentage increase, rising by 55.7 percent while the wholesale trade sector reported the largest dollar increase of $378.9 million. Of the sectors that reported gains, the utilities sector grew 55.7 percent; construction grew 46.1 percent; financial, insurance, real estate, rental and  leasing grew 35.5 percent; wholesale trade up by 30.7 percent; miscellaneous grew 28.8 percent; mining and oil extraction grew 25.4 percent; other services, up by 20.3 percent; manufacturing grew by 16.7 percent; accommodation and food services, up by 13.5 percent; professional, scientific, technical, and management services grew 13.4 percent; information industries grew 13.1 percent; retail trade up by 13.1 percent; and arts, entertainment and recreation grew 7.9 percent.
Two sectors reported a slowdown in taxable sales and purchases: educational, health care, and social services, dropped 7.5 percent; and transportation and warehousing, declined 4.3 percent.
“While the global economic slowdown may have moderated North Dakota’s growth a bit in the third quarter, early reports suggest that the holiday shopping season got off to a great start,” said Fong. “Even though North Dakota is facing labor and housing shortages, a steady job market along with North Dakota’s strong economy has encouraged consumers to be in a spending mood this Christmas season.”
Of the 50 largest cities, the largest percentage increases for third quarter of 2012 were: New Town, up 87.4 percent; Tioga, up 62.7 percent; Watford City, up 46.7 percent; Crosby, up 44.5 percent; and Kenmare, up 42.2 percent.
The largest percentage third quarter decreases for the 50 largest cities were in Walhalla, down 26.4 percent; Mayville, down 22.6 percent; Linton, down 17.5 percent; Cando, down 14.5 percent; and Beach, down 12.7 percent.
Counties with the largest percentage increases were Renville, up 56.5 percent; Oliver, up 53.2 percent; Divide, up 42.3 percent; Cavalier, up 39.6 percent; and McKenzie, up 39.4 percent.
The counties with the largest percentage decreases were Emmons, down 24.9 percent; Steele, down 15.1 percent; Benson, down 13.8 percent; Towner, down 13.1 percent; and Golden Valley, down 10.9 percent.