State economic picture steady, except up North


Minnesota is a geographically and economically diverse state. It’s often remarkable when I travel from my home here in the North to the Twin Cities how different the very fabric of society and the economy feels. The two worlds seem like they don’t require one another to survive.

That’s not really true, of course. The state is economically linked in countless ways, often unseen. But sometimes we see quantitative evidence of the differences among the regions of Minnesota.

Take the jobs picture.

Minnesota has had a run of very good economic years. As a state, we’re well above the national average in job creation and general employment. But the opposite is true in Central and Northeastern Minnesota, according to recent state reports. The 2016 prospects for our area remain grim.

The reports were developed by the St. Cloud State University School of Public Affairs Research Institute, in partnership with the Office of the Minnesota Secretary of State.

“We see steady growth for the first half of 2016 in most parts of the state, including the metro Minneapolis-St. Paul region,” said King Banaian, report co-author and dean of the School of Public Affairs at St. Cloud State University.  “There may be some slowing down in growth in Central and Northeast Minnesota.  While several of our leading indicator series point downward, there is still momentum in employment growth throughout the state.”

The reasons for Northeastern Minnesota’s lagging are clear. Mining remains the leading industry on the Iron Range, and it’s had a historically bad year. Manufacturing is important to other parts of Northern Minnesota, but that, too, has fared poorly. Duluth is doing better than the Range, but only marginally so, according to the report.

The analysis from this report out of the Secretary of State’s office looks forward, not back. It’s not just the layoffs in mining that affects the picture her. It’s the lack of new business starts and the generally poor economic activity outside of the struggling dominant industry, too.

That’s important. It suggests that our woes aren’t as simple as getting laid off miners back to work. We must improve the economic climate much more broadly.

One final note. The fact that mining and manufacturing struggled through 2015 and continue to struggle today suggests that the positive outlook elsewhere might be built on sand, or at least wet ground. Normally economic growth comes with strong demand and higher prices for things people use. We have good consumer confidence numbers, but the elemental products aren’t moving.

This suggests a few possibilities. One, a trade imbalance with foreign countries. Two, an economic mirage in which people think they have more money than they do. Three, a service-based economy that requires cheap goods to survive.

What if all of these things are true? In this, I’d view conditions in Northeastern Minnesota as not only a problem to solve but a cautionary tale for everyone else, too.


  1. Swanmaiden says

    Mining is crippling other industries in our area, it is shackling our homes and communities to mining with leases that bind the state to assist mining. The mining destroys our primary assets and resources clean water. Its real.

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