Lisa A. Bastian (June/July 09)
According to the Center on Budget and Policy Priorities in Washington, D.C., 47 of the 50 U.S. states face "fiscal stress" in their fiscal year 2009 and/or fiscal year 2010 budgets. Minnesota is no exception: Its 2009 legislative session ended in May without a concrete plan on how to balance the remaining $2.7 billion budget shortfall.
However, aside from the budget challenges, the state's economy is poised to grow in both historically strong areas and emerging new ones. Its legion of companies has a long tradition of innovation, and Minnesota is known for its steady work force and employers who continue to invest through "thick and thin" times.
Minnesota is home to 19 Fortune 500 companies and ranks ninth among all states with these sought-after giant entities. The companies comprise diverse industries - from medical device manufacturing, financial services, and insurance to food products, retail, and transportation - and include such household names as Best Buy, Target, 3M and General Mills.
The state's $17.3 billion in 2008 export sales reveals a number of robust sectors. Computers and electronics comprised about 25 percent of those sales. Other top categories included machinery ($2.9 billion); transportation equipment ($2 billion); miscellaneous, including medical ($2 billion); food ($1.4 billion); and chemicals ($1 billion).
Minnesota ranks third in the United States in wind energy production capacity and fourth in ethanol production. Its energy industries are increasingly taking "center stage" and attracting new investments. Moventas, a Finnish builder of gear boxes for wind-power turbines, recently selected Minnesota over several states competing for its U.S. facility. Production begins by year-end 2009 and will reach full capacity by 2011. Tax-free development Incentives offered via the state's JOBZ program were key the firm's decision to select its Faribault site.
In science, Minnesota is home to the world-renowned Mayo Clinic in Rochester. It positions the state as an international leader in biotech and medical genomics. Fifteen minutes from Mayo, plans are now underway to develop Pine Island's 200-acre Elk Run biobusiness park, part of a 2,325-acre master-planned community. Reports say almost $1 billion will be invested in this highly touted R&D and manufacturing project, expected to bring thousands of drug, medical device, and other innovative bio jobs to the state.
One promising and highly sought-after growth sector is "renewable" chemistry. This past February, Minneapolis-based Segetis announced its new facility is now producing "green" chemicals. Its proprietary processes use non-food agricultural and forestry feedstocks to create all kinds of new sustainable chemicals and plastics equivalent to fossil fuels. At full operating capacity, the facility will produce almost 250,000 pounds of chemicals annually.
Earlier this year, McQuay International, an HVAC company that's part of Japan's Dalkin Group, opened a $50 million, global R&D center in Plymouth and is expected to hire 70 engineers and managers at its new 49,000-square-foot facility. The company will test advanced low-energy consumption technologies expected to reduce carbon dioxide emissions, thought to be a major cause of global warming. After a global search, McQuay chose the Twin Cities area mainly due to its "significant pool of experienced and highly educated engineers" with a notably positive work ethic.
All told, Minnesota's 94 announced expansion projects in 2008 are worth an estimated $3 billion, and will add or retain an estimated 4,000 jobs.