Minnesota's long-heralded economy is losing steam according to a new report released Wednesday by the Minnesota Chamber Foundation which showed Minnesota’s GDP per capita has grown by just 1.0% annually since 2019, ranking 38th among states – well below the national average of 1.8%.
According to key economic measures highlighted in the report, Minnesota's labor force is seeing slow growth, increasing by 0.2% per year, ranking 40th in the nation. Additionally, Minnesota saw 48,000 residents leave the state than move here during a four year period from 2020 to 2024.
“These stats should serve as a wake-up call,” wrote Doug Loon, president and CEO of the Minnesota Chamber of Commerce. “We cannot hide from the realities of our economic position. We can both celebrate what’s great and confront the barriers that hold us back. It’s time to restore our competitiveness and create opportunity here in Minnesota.”
WCCO Radio political analyst Blois Olson discussed the findings Wednesday morning on the WCCO Radio Morning News with Vineeta Sawkar.
"We just don't have the growth, we don't have the workforce growth or the GDP growth that other states have," Olson said. "This comes on the heels of a Greater MSP report that said we're facing headwinds here."
"As I travel around the upper Midwest and other other states, communities are doing better at holding on to their workforce, holding on to their youth, they're adding the amenities, they're creating a competitive wage, they're they're affordable states, and that's those are the states that are attracting talent right now," Loon explains.
Loon telling WCCO's Adam and Jordana reforming the business tax code will be a big priority for them in the upcoming legislative session. He says they'll also work to modify the state's new Paid Family and Medical Leave Act, which he says will be a huge burden to businesses when it takes effect in January.
"And we have uncertainties around our regulatory climate," says Loon. "We know we're a high-cost state is it relates to taxes and increasingly we're a high cost in other categories as well, that we need to think hard about before we put up more roadblocks to economic success and economic growth."
Minnesota's economic outlook isn't entirely doom and gloom, with the report noting the state ranks among the top ten in the share of adults (25 and older) with at least a bachelor's degree and with an associate or higher.
Minnesota also continues to produce the 5th-highest number of patents per capita and appears to be attracting investment in fast-growing sectors such as data centers, semiconductors, critical minerals and clean technologies.
"Some people just say business is never happy, we have high taxes, and look at our quality of life," Olson said. "What the Chamber is saying here is we need to grow the workforce, deliver better value from our government, and we need to accelerate growth."