When businesses are considering where to locate or expand, Minnesota should be top of mind for all the usual site selection reasons – its educated workforce, robust innovation ecosystem, growing economy, solid business incentives, and top-notch digital and physical infrastructure.
But there’s another reason to keep Minnesota top of mind. Minnesota’s quality of life makes it easier for businesses to attract and retain the talent they need to thrive.
The state routinely ranks among the top five in quality of life. In fact, WalletHub named Minnesota:
- #1 Best State to Raise a Family in 2020; and in 2019:
- #1 Safest State
- Best State for Women
- Best State for Health Care
In 2019, Forbes and CNBC ranked Minnesota third in quality of life, and CNBC ranked it third in education.
What’s more, Minnesota has the highest median family salary when adjusted for cost of living, according to WalletHub. So, as people across the country look for more affordable places to live – and good schools for their children – Minnesota is a natural landing spot.
Another draw is the state’s diverse industry sectors and supportive business climate, which enable dual-career couples to each find rewarding work in their field or to launch new business ventures.
Growing businesses from startups to giants is something in which Minnesota excels. After all, it’s the birthplace of 3M, Medtronic, Target, Best Buy and General Mills, to name just a few. Minnesota ranks fourth best in the nation in its five-year business survival rate.
Per capita, the Twin Cities rank first in Fortune 500 companies among the 30 largest metro areas, and Minnesota ranks fourth (2019). Other notable businesses include global agribusiness Cargill Inc., headquartered in Wayzata, Minnesota, which Forbes lists as the largest privately held corporation in the nation, and Mayo Clinic in Rochester, Minnesota, which has ranked the past three years as the nation’s top hospital and is an international leader in health care.
Minnesota’s strong business climate helps companies of all sizes prosper. CNBC named Minnesota as America’s 7th top state for business in 2019 and has ranked it among the top 10 states for business 11 times between 2007 and 2019 – including first and third in the past five years.
Looking at the state’s mix of industries, Minnesota ranks 11th in terms of economic diversity. Standout industries include medical devices, financial services, advanced manufacturing, clean technologies, food production and agriculture.
Minnesota’s burgeoning startup community got a boost in 2019 from Launch Minnesota, a statewide collaborative effort to accelerate startups and amplify Minnesota as a national leader in innovation.
Spearheaded by the Minnesota Department of Employment and Economic Development (DEED), Launch Minnesota announced its first round of grants in January 2020, awarding over $672,000 to 20 technology startups across the state.
Grants are awarded on a competitive, ongoing basis and are targeted to remove barriers to entrepreneurs by reimbursing business operations and housing/child care expenses, and to give an extra boost to SBIR/STTR Phase 2 recipients. Launch Minnesota also offers education grants to organizations across the state that catalyze Minnesota’s innovation ecosystem with educational programming, outreach and collaboration.
Other state programs helping new businesses include the Angel Tax Credit program, which provides a 25 percent credit to investors that make equity investment in startup companies focused on high technology, and the Emerging Entrepreneur Loan program, which offers startups forgivable interest-free loans.
The Angel Tax Credit program has attracted more than $461 million in private investment and awarded over $111 million to investors since 2010. It has assisted more than 480 startup businesses. In 2019, the Minnesota Legislature designated $10 million for the program, with an additional $10 million for 2021.
Venture capital investments in Minnesota companies grew in 2019. In total, Minnesota received $908 million in venture capital in 2019, ranking second in the Midwest. On a per capita basis, the state ranked 9th in the nation in venture capital received.
Among the many popular annual entrepreneur events are Twin Cities Startup Week, which features hundreds of events and draws well over 15,000 attendees along with MN Cup, the largest statewide startup competition in the country.
During the past three years (2017-2019), Minnesota has identified close to 600 business expansion projects in selected tracked industries. These represent a total investment of more than $7.5 billion and creation of about 24,000 new jobs.
Two DEED programs – Minnesota Investment Fund (MIF) and Job Creation Fund (JCF) – are key to fueling business expansion in the state.
In 2019, the JCF awarded nearly $9.5 million and leveraged a projected $239.5 million in eligible capital investment. This is expected to result in the creation of more than 1,500 new jobs in the state.
Likewise, MIF awarded over $6.6 million and leveraged about $313.5 million, which is expected to create 900 jobs.
Examples of some recent business expansion projects include:
Renewal by Andersen: Window and door manufacturer Andersen Corp., based in Bayport, Minnesota, broke ground last July on a 350,000-square-foot expansion of its Renewal by Andersen manufacturing campus in Cottage Grove. The company is investing over $35 million in the project. DEED supported this project – expected to create at least 125 new jobs – with a $450,000 award from MIF and a $800,000 award from JCF. “With the support of the state, Andersen’s expansion will create new jobs for Minnesotans right here in Cottage Grove,” said Governor Tim Walz. “It’s this type of partnership and collaboration that make Minnesota a top state to live, work, and raise a family.”
Barrett Petfood Innovations (BPI): A family-owned business that makes premium pet food, BPI is expanding from Brainerd to Little Falls. The expansion is expected to create 85 jobs over three years. DEED supported the project with a $450,000 MIF award and a $175,000 JCF award. “This expansion is another example that businesses don’t need to be in the Twin Cities metro in order to succeed,” said DEED Commissioner Steve Grove. “DEED is focused on empowering the growth of the Minnesota economy for everyone – especially those in Greater Minnesota.”
Minnetronix Medical: The St. Paul medical technology company is planning its fourth expansion since moving to its current location in 2000. The latest project will increase the company’s footprint from 120,000 to 140,000 square feet – with plans to grow to 170,000 by 2023. The company expects to add 75 jobs within three years. DEED is supporting the project with a $500,000 award from JCF and a $500,000 MIF loan. “Minnetronix Medical embodies Minnesota’s rich history of innovation,” said DEED Commissioner Grove. “DEED’s programs are targeted at companies that are rising leaders in their field and committed to growing good-paying, high-quality jobs in our state.”
Minnesota values education – as evidenced by its rank of third in the percentage of the population with a high school degree or higher, and 11th in the percentage with a bachelor’s degree or higher.
Minnesota also understands the importance of customized training and talent pipeline development in helping businesses meet their current and future workforce needs. Several programs and partnerships that address this include:
Minnesota Jobs Skills Partnership (MJSP): Since 2011, MJSP has awarded $67.6 million to train more than 79,000 workers and has leveraged $140 million in private funding. Businesses and educational institutions work together to secure MJSP funding through DEED to develop customized training for Minnesota workers. The Partnership Program provides up to $400,000 for training new workers and existing employees. Dual Training Competency Grants offer grants to employers in four key industries; the Job Training Incentive program offers worker training grants of up to $200,000 to new or expanding businesses in Greater Minnesota; and SciTechsperience Internship program connects college students in STEM disciplines with opportunities at small- to mid-sized Minnesota companies with a match for up to 50 percent of an intern’s wages.
Workforce Strategy Consultants: These professionals work with employers to build talent pipelines through community and school collaborations, provide labor market analysis, and help employers access grant funding opportunities and tax credits. Their services are available statewide at no fee to employers as part of CareerForce, Minnesota’s career development and talent matching resource.
Since 2014, the Border-to-Border Broadband Development Grant program has invested $108 million across Minnesota through 140 projects, which have helped connect nearly 50,000 homes, businesses, farms and community institutions. The State of Minnesota has set a goal for universal access to high-speed internet by no later than 2022 – with even faster speed goals by 2026.
Minnesota has excellent physical infrastructure and a great location. It’s within a day’s truck drive of more than 50 percent of the U.S. population. Moving goods to market is efficient with three interstate highways (I-90, I-94, and I-35); eight commercial ports on Lake Superior and the Mississippi River; and four Class I freight rail lines with over 3,500 Class I rail miles.
Minnesota also has nine commercial airports, including Minneapolis-St. Paul International (MSP), which has been ranked – for three years in a row – as the best airport of its size in North America by Airports Council International.
Minnesota is among the top 10 states in the nation in both installed generating capacity and net electricity generation from wind, according to the U.S. Energy Information Administration. The state ranked eighth in 2018 in new solar energy PV installations, according to the Solar Energy Industries Association. Renewable energy resources accounted for about one-fourth of Minnesota net electricity generation in 2018 – with the most coming from wind power.
Minnesota offers business assistance that includes location and expansion services, business financing programs, assistance with exports and foreign direct investment, foreign trade zone consultations, and more. There are also more than 35 shovel-ready certified sites across the state ranging from 20 to 300 acres.
If you’re looking for a place to start or expand your business – make Minnesota top of mind.
Visit CompareMN.com to find out more.