Quarterly Economic Report - June 2000 By Patrick Hanlon, RCGA manager of research and analysis REGIONAL JOB GROWTH CONTINUES INTO THE FUTURE The St. Louis region maintains its level of job growth into the new Millennium. Since January 1995 the total net job growth for the region has reached more than 94,000 new jobs. This moves St. Louis 8,500 jobs or 10% ahead of target for 100,000 net new jobs by year end 2000 as set by The Campaign for a Greater St. Louis. Since the Campaign for a Greater St. Louis began in 1995 the region has enjoyed an annual employment growth over 1.6% from just less than 1.0% from 1989 to 1994. Here is the methodology used to calculate the employment growth: RCGA receives the Current Employment Statistics (CES) each month the Research and Analysis Department of the MO Department of Labor. This number is the raw data and essentially comes from the Bureau of Labor and Statistics (BLS). The raw data is then taken and run through the X-11.2 Seasonal Adjustment program, which is from the U.S. Census Bureau. This program takes into account holidays, seasonal employment, opening and closing of schools, etc. and eliminates those influences to give a more regular pattern. The program generates the seasonally adjusted total non-agricultural employment for the St. Louis MSA. Then the base number, which is December 1994, is subtracted from the current month to give us the net new jobs that have been created since the start of the campaign. RCGA NAMES PATRICK RISHE, PH.D. AS CHIEF ECONOMIST AND DIRECTOR OF RESEARCH Following an exhaustive statewide and national search we are proud to announce the arrival of Patrick Rishe, Ph.D. (Economics) to our staff. Rishe, assistant professor of Economics at Webster University since June 1999, will continue to teach full time at the University. Prior to his recruitment to Webster, Rishe was an assistant professor of Economics at the North Carolina Forecast Center at the University of North Carolina at Charlotte, where he designed and conducted analyses on a number of regional economics and sports-related initiatives. He also assisted with quarterly economic forecasts for the Charlotte Chamber of Commerce. Rishe earned his doctorate in Economics in May 1997 at the State University of New York at Binghamton. He received his bachelor's and master's degrees in Economics from the University of North Carolina at Charlotte in 1992 and 1993 respectively. PEOPLESUPPORT SUPPORTS ST. LOUIS This Los Angeles-based high tech firm provides "24 x 7 web-based solutions" for customers around the globe. PeopleSupport.com is considered a world leader in developing and implementing "e-commerce" strategies for customers such as CarParts.com, MGM and Time Warner. PeopleSupport selected 555 Washington in St. Louis' central business district to house its new Midwest location. The company leased 25,000 square feet of space, which will house 300 high-technology employees when operational in mid-2000. MILLSTONE BANGERT EXPANDS IN ST. LOUIS This heavy construction company based in the Brentwood area along Highway 40/64, has selected St. Charles as its new location. The move was precipitated by the planned expansion of the Promenade commercial/retail complex. Millstone will establish its headquarters in the new Fountain Lakes development. The firm has played a major role in the creation of this new state-of-the-art industrial park. Millstone expects to create 100 new jobs in the process of the relocation and expansion. ST. LOUIS PROVIDES FOR MCI INTERNET This telecommunication giant has acquired 10 acres in Bridgeton for the construction of a new "co-location" facility to address the growing demand for high-speed Internet and data transmission. The $150 million facility will support multiple providers of Internet services and employ 20 technicians to operate and maintain the systems on a "24 x 7" basis. EMPLOYMENT AND WAGE TRENDS IN ST. LOUIS The St. Louis economy has been operating at its full potential over the last year, and showing a great increase in job creation in the latter half of the 90s. The industries showing the largest increases in employment are Service, Construction and Private Service Production. The Service and Construction industries posted more than 30 percent increases from 1990 to 1999 in average annual employment. The Private Service Production industries increased nearly 20 percent over that same period. The manufacturing industries showed a decrease in employment over the last 10 years. Manufacturing decreased nearly 15 percent. The Goods Producing showed a 5 percent decrease in employment. The average hourly earnings have maintained an increase throughout the 1990s, but have shown a much greater increase in the 1995 to 1999 period. The Construction and Goods Producing industries have posted the greatest increases from 1990 to 1999 at 22 and 17 percent respectively. The Trade, Services, and Private Service Production industries posted the lowest increases in average hourly earnings. (See charts below.)

June 2000 - - - - - - - - - - - - - - - - - - Cover Story The Big Leagues PROFILE John Capps President and CEO Plaza Motor Company - - - - - - - - - - - - - - - - - - www.stlrcga.org - - - - - - - - - - - - - - - - - - www.technologygateway.org On the Road Again Merger Boom - - - - - - - - - - - - - - - - - -

KEY ECONOMIC INDICATORS Greater St. Louis Jan-00 Last Year Change From Last Year Percent Change from last year Civilian Labor Force 1,332,196 1,293,960 38,236 2.95% Total Employment 1,304,200 1,282,700 21,500 1.68% Unemployment 40,199 53,043 -12,844 -24.21% Unemployment Rate 3.0 4.1 -1.1 Average Hourly Wages 222 Goods Producing $18.52 $17.86 0.66 3.70% 222 Service Producing $12.71 $12.45 0.26 2.09% 222 Construction and Mining $23.63 $22.68 0.95 4.19% Residential Building Permits 8,319 8,172 147 1.80% (Totals for 1999 and 1998 respectively) Consumer price index 158.8 155.0 3.8 2.5% (CPI-U, 2nd half 1999, 1982-84=100.0) ACCRA Cost of Living Index 97.5 97.7 -0.2 -0.2% (4th Quarter 1999 and 4th Quarter 1998 respectively) Sources: Bureau of Labor Statistics, Census Bureau, American Chamber of Commerce Researchers Assoc. (ACCRA).

Average Hourly Earnings 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 Change 1990-2000 Goods Producing $12.00 $12.03 $12.31 $12.64 $13.14 $16.04 $16.63 $16.83 $17.53 $18.09 17% Private Service Production $8.44 $8.70 $8.94 $9.19 $9.44 $10.46 $10.97 $11.47 $12.07 $12.57 12% Manufacturing $10.74 $10.86 $11.24 $11.55 $11.77 $14.61 $15.12 $15.20 $15.84 $16.09 15% Durable Goods $11.69 $11.77 $12.23 $12.43 $12.51 $15.19 $15.80 $15.90 $16.52 $16.77 16% Nondurable Goods $9.46 $9.72 $9.99 $10.45 $10.91 $13.74 $14.11 $14.09 $14.74 $15.03 14% Construction $17.42 $17.31 $17.15 $17.43 $18.08 $20.36 $21.18 $21.48 $22.14 $22.99 22% Transport, Comm, and Utilities $11.27 $11.68 $12.14 $12.89 $13.71 $13.15 $13.37 $14.20 $14.79 $15.78 15% Trade $7.48 $7.68 $7.75 $7.94 $8.10 $9.27 $9.77 $10.60 $11.30 $11.79 11% F.I.R.E. $9.53 $9.91 $10.17 $10.45 $12.00 $11.44 $11.68 $12.43 $13.17 $13.70 13% Services $8.27 $8.52 $8.89 $9.08 $9.22 $10.54 $11.03 $11.20 $11.64 $12.11 11%

Employment 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 Change 1990-1999 Goods Producing 278,700 257,900 254,700 253,100 258,100 260,900 259,300 262,500 263,100 263,600 -5.42% Private Service Production 758,100 756,800 768,700 786,700 814,800 831,800 852,400 874,000 889,400 902,600 19.06% Manufacturing 221,800 206,100 202,900 198,200 196,600 200,000 196,800 196,000 195,000 189,600 -14.52% Durable Goods 140,100 126,100 123,700 118,400 117,300 121,700 120,900 121,100 120,200 115,300 -17.70% Nondurable Goods 81,700 80,000 79,200 79,900 79,300 78,300 75,900 74,900 74,800 74,300 -9.06% Construction 56,800 51,800 51,900 54,900 61,500 60,900 62,500 66,500 68,100 74,000 30.28% Transport, Comm, and Utilities 78,800 78,600 77,200 76,500 78,200 79,200 80,600 82,700 84,300 86,800 10.15% Trade 282,000 278,300 280,200 283,200 291,600 297,900 302,000 306,200 308,700 312,200 10.71% F.I.R.E. 76,100 73,900 73,000 73,800 76,400 75,800 77,600 79,500 82,500 83,400 9.59% Services 321,300 325,900 338,300 353,200 368,500 378,900 392,200 405,600 414,000 420,300 30.81%