Minnesota’s Economic News – W/E 7/16/21
State and local taxes and spending Star Tribune: St. Cloud will use federal relief to offset lost revenue KNSI: Minnesota to Finish Fiscal Year 2021 Stronger Than Expected Pioneer Press:…
New business benchmarks reveal signs of stress in business climate
Minnesotans will go to the polls Nov. 8 to elect all 201 legislators in the State House and Senate. We issue our first challenge to all those elected: Let’s focus on placing Minnesota in the top 10 states for job, economic and income growth.
To achieve that goal, Minnesota needs to be ready for the future – ready for change, ready to grow and ready to compete.
Our job at the Minnesota Chamber of Commerce is to help all Minnesota businesses grow and excel. We advocate for public policies to promote economic opportunity and strengthen our business climate that ultimately benefit all Minnesotans by encouraging a growing economy and good jobs.
Where does Minnesota stand? The inaugural Minnesota Business Benchmarks, a collection of key economic business indicators, shows mixed results. The report, which will be produced annually by the Minnesota Chamber and our local Chamber Federation partners, provides key data points to determine how Minnesota is faring compared with the rest of the nation.
The Business Benchmarks show we have a dynamic and diverse economy forged by a business culture that is rooted in innovation and growth. We are proud of our talented workforce. Our business owners are forward-thinking and risk-takers. Our quality of life is the envy of many states.
But despite what we have achieved, the Business Benchmarks report clearly shows that our state’s business climate shows signs of stress.
Among the troubling economic statistics: Job creation is 35th in the nation at 1.1 percent versus the national average of 1.88 percent. Personal income growth is 29th in nation at 3.8 percent versus the national average of 4.4 percent. GDP growth improved from 27th ranking in 2014 to 12th in 2015 due to a strong first quarter in 2015. However, the last 12 months spanning the first quarter of 2016 show Minnesota’s GDP now lagging the national average.
It’s important to note that most other states including our neighbors are working to lower costs and regulations to be more attractive for business growth and expansion. Minnesota, unfortunately, is going the opposite direction. Witness past actions and proposals by some in the Minnesota Legislature.
The 2013 tax increase created the top income-tax tier of 9.85 percent, third highest in the nation. The minimum wage was phased in to $9.50 per hour and is now on automatic pilot with an inflation index. Proposals for new labor mandates are a regular occurrence. Gov. Mark Dayton continues to propose higher taxes on business even with billiondollar surpluses in the state budget.
The 2016 Legislature was a missed opportunity to enact policies to help develop and grow Minnesota’s economy. We still hold hope of a possible special session to complete work from the regular session, much of which was left unfinished from 2015. Our priorities are to provide much needed tax relief; invest in transportation funding for roads, bridges and transit; and provide explicit state preemption of municipal workplace mandates. That’s just a start. Rarely does a new legislative session kick off without leaders pledging to advance policies to create jobs for Minnesotans. I fondly recall a favorite saying of my predecessor, David Olson: “You cannot be pro-jobs and anti-business.” This seems to be forgotten by many who are advocating for new regulations, more costs and overall making it harder for job-creators in our great state.
Let’s collectively pledge to deliver solutions to ensure that Minnesota is ready for change and ready to grow. That benefits all Minnesotans. We stand ready to assist.
Doug Loon is president of the Minnesota Chamber of Commerce – www.mnchamber.com.