Fri, Apr 29, 2022 12:23 PM
By Mary Stroka / The Center Square contributor, The Center Square
(The Center Square) – Minnesota is the 10th worst state for business, according to this year’s ranking from Chief Executive Magazine that was published this week.
The magazine’s report, “Best & Worst States for Business Survey of CEOs,” surveyed nearly 700 CEOs, company presidents and business owners across the nation.
Minnesota appears to be moving up, the report said.
As noted in the report, Gov. Tim Walz announced in September 2021 the launch of his Council on Economic Expansion, which brought together 15 Minnesota public and private leaders to provide recommendations on expanding the economy.
“As we continue to navigate the Covid-19 pandemic and look toward the future, we must take bold action to build back Minnesota’s economy stronger than before, with people – our strongest asset – at the center of the blueprint,” Walz said. “The Council on Economic Expansion brings together the brightest minds in Minnesota to create a strong economic future that includes every Minnesotan.”
Greater MSP announced that month ConnextMSP, a talent network to promote racial equality and power economic growth in the region through ensuring young adults of color have a strong start to their careers.
Developers are attracting groundbreakings and expansions to the state, the report added.
Doosan Bobcan began a $26 million expansion with 160 new jobs in Litchfield. The Mayo Clinic in August 2021 announced a $200 million expansion of its proton cancer therapy center in Rochester. Silk Road opened an office in Plymouth in June 2021, and First Independence Bank filed an application in August 2021 to open a branch in the Twin Cities. Soona announced in May 2021 its expansion in the Twin Cities. Amazon announced in October it plans to build a fourth facility in the Twin Cities.
Eighteen Fortune 500 companies are headquartered in the state, including UnitedHealth Group, Target, Best Buy, 3M, CHS, U.S. Bancorp, General Mills, C.H. Robinson, EcoLab and Land O’Lakes.
Key incentives include the Minnesota Investment Fund, Minnesota Job Creation Fund, Job Training Incentive Program and Launch Minnesota.
Minnesota boasts the second-best quality of life and an unemployment rate of 3.5%.
Still, Minnesota, which is not a right-to-work state, is 46th on the Tax Foundation’s State Business Tax Climate Index ranking, Its top corporate income tax rate is 9.8%.
Indiana, ranked sixth-best nationally, was the top-ranked state of the Midwest, while Ohio is the seventh highest.
“Amid a resurgence of high-profile economic development projects throughout the nation’s industrial heartland, Indiana, No. 6 overall, remained the top-ranked state in the Midwest,” the report said. “Even before Intel’s promise to start with a new $20-billion microchip plant in No. 7 Ohio, the two states continued to lead a relentless, years-long rise in the rankings by Midwestern states including Iowa, Michigan, Wisconsin and Missouri.”
Texas has ranked first every year since 2001, the first year of rankings. The state has no corporate income tax, a fast-growth population, low regulatory business climate and a diverse, skilled workforce.
California remains the worst, followed by New York, Illinois, New Jersey and Washington. High taxes, regulatory burdens and costs of living contribute to keeping them at the bottom of the rankings, despite having some of the nation’s top talent pools and education systems, the report said.
“It will take a true revolution in their tax and regulatory structures to gain ground with CEOs – and move up from the basement,” the report said.