High jobless rate persists, but signs of recovery in Brainerd

Kenneth Kangas feels lucky to have a job.

Kangas, who works at Lakeland Mold, a manufacturer of plastic molds in Brainerd's industrial park, was laid off sporadically this year -- for weeks at a time in March and June, then again for all of September and October. He's one of a handful of workers called back last month.

At 60, he worries about some of his younger colleagues still out of work.

"I feel really sorry for a lot of these people, because they've got to really be hurting," he said. "And I don't know how these younger people with families are doing it."

The unemployment rate in Brainerd is at more than 15 percent -- the highest jobless rate among Minnesota's large cities. It's a distinction Brainerd has kept throughout the recession.

But people in the Brainerd Lakes area see signs of an economic recovery, and reasons to be cautiously optimistic about 2011.

Lakeland Mold laid off a third of its workforce of about 90 the past couple of years. But the company is slowly bringing workers back. CEO John Newhouse said orders are picking up. He projects 10 percent growth into next year.

"We've started seeing the business strengthen, particularly in the last half of 2010," Newhouse said. "So we're stabilized right now, but expecting the business to begin to increase as we move into 2011."

Manufacturing took a big hit the past couple of years. Brainerd and the rest of Crow Wing County lost close to 600 manufacturing jobs. Several plants shut down permanently.

Climbing out of the economic hole will take time, but local companies are beginning the process, said Sheila Haverkamp, director of the Brainerd Lakes Area Economic Development Corporation.

"I'm sensing that companies are feeling that it's getting more predictable and they've leveled out," Haverkamp said. "I wouldn't say that their feeling confident yet that the upswing has totally occurred, but they feel that they probably are at what hopefully is the new normal."

There are other signs in Brainerd and neighboring Baxter that the economy is improving.

Most retail development came to a halt in 2008. But a number of store fronts that were empty for a year or more are now occupied by new businesses, commercial realtor Kevin Close said.

Commercial property values dropped about 30 percent. But now there are big box retailers and restaurant chains back in the pipeline, making plans to build in 2011. Close said a strong holiday shopping season showed people are more willing to spend.

"It takes a change of attitude before anything can change, and I think we're feeling that," he said. "Spending is up. The general news is better, and I think people are feeling better. It's not going to be a straight up curve, but it should start to tick up, and we're betting on it."

One sector of the economy that may take longer to recover is the construction industry.

Bob Sweeney, CEO of Baxter-based Nor-Son, Inc., said his company laid off about 35 percent of its employees. He doesn't expect much will change in 2011. Even though there are signs of a recovery, Sweeney said it will take awhile for that to translate into new residential and commercial construction.

"The work that we're seeing is taking a long time to get off the ground," Sweeney said. "It's not like a project is drawn and ready for bid and it's ready to hire the workforce that needs to build it. What we're seeing is there's more planning right now and talk of projects, but those projects are out a fair ways."

Many who lost their jobs aren't waiting around to get called back to work. Instead, they're getting retrained. Enrollment at Central Lakes College in Brainerd is up about 13 percent this year. That's one of the largest increases in the state and the fourth straight year of growth.

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