What are the forces moving the Minnesota economy? Adam Belz tries to identify the trends and show the connections between Minnesota and the larger U.S. and global economies. You can connect with him on Twitter: @adambelz
Economy boomed in 2014 as DC brinkmanship waned – LA Times
The oil industry: Sheikhs versus Shale – Economist
“We really don’t know very much about macroeconomics at all” – Mark Buchanan
“Minnesota is the heart of the Midwest, the most Midwestern state” – St. Cloud Times
Teamsters blast Canadian Pacific over maintenance worker cuts – Bismarck Tribune
12 geopolitical and economic lessons for 2015 – John Cassidy
Rural workforce, housing on the brain as MN legislative session begins – GF Herald
Iowa startups raised $147mn in 2014 – Welch Avenue
Behold, the most-clicked business stories from the Star Tribune in 2014 (defined as a story written by a reporter on the business staff, with the exception of the Dunkin’ Donuts story by Paul Walsh).
The surprise winner to me is David Phelps’ recent story on the Davis family business empire. Target’s early 2014 problems also attracted a lot of attention, as you can see.
On a wall at Jake’s Pizza in downtown St. Peter is a photo of the town’s 1981 Class A high school football champions. Wearing No. 10 for the St. Peter Saints is defensive back Marty Davis. Wearing No. 22 is his older brother Mitch, the team’s fullback.
Fast forward 33 years and the two brothers are still teammates, only the stakes are considerably higher as they lead the third generation of one of Minnesota’s most successful business families.
From Cambria quartz countertops to Davis Family Dairies to Sun Country Airlines, the Davis family owns and manages some of the state’s landmark homegrown businesses. They employ 2,600 workers and take in about $710 million a year in revenue, a figure that would rank the privately held business 38th among Minnesota’s 100 largest publicly traded companies.
Target Corp. laid off 475 employees Wednesday and said it will not fill 700 open positions as the company struggles with stubbornly sluggish sales and fallout from the massive computer security breach that short-circuited its crucial holiday period.
The retailer described the cuts as “worldwide.” It didn’t say how many were at its headquarters in downtown Minneapolis, but sources told the Star Tribune that the majority of the layoffs were there.
“The economy is simply not growing that fast, and retail’s moves are highly correlated to the economy,” said George John, associate dean at the University of Minnesota’s Carlson School of Management. “All these retailers face very challenging business times.”
Target’s efforts to regain customers’ trust after a massive data breach include an offer of daily credit card monitoring, identity theft insurance and access to a fraud resolution agent.
Any Target customer who shopped in one of its U.S. stores is eligible for a year of free credit monitoring and identity theft protection, Target announced this week. The service is called ProtectMyID from Experian, a credit monitoring company.
Those who sign up before April 23 and enroll with a code by April 30 will receive a free copy of their credit report along with the other services.
4. Cargill to outsource IT services, 900 jobs affected, March 27
Cargill Inc. will outsource some of its information technology services, a move that will affect 900 jobs worldwide, including 300 in the Twin Cities.
The Minnetonka-based agribusiness giant told employees this week that it will move certain IT functions to Tata Consultancy Services, a big global IT outsourcing firm based in Mumbai, India. The transition will take up to 9 months.
Cargill hasn’t determined how many of the 900 jobs will be cut outright, said Lena Michaud, a company spokeswoman. Some employees in the affected IT division will remain with Cargill, others will be offered jobs with Tata, and others will be laid off, she said.
However, a source said that a majority of the 900 Cargill jobs would likely be cut.
As hard as he tried, Michael Duffy couldn’t find a job to match the one he’d lost.
For two decades he earned six figures selling equipment to factories. But at 62, he kept getting turned away, one job interview after another.
So last fall he started at Starbucks.
He wears a green apron, wipes tables, mans a cash register that he’s gradually learning and banters with people who order an espresso breve or a Caramel Brulée Latte. He has natural rapport with customers, especially older ones, enjoys winning people over and likes taking care of them.
But he makes less in a day than he did in a half-hour at the peak of his sales career.
“The pay isn’t what we would all hope,” Duffy, of Eden Prairie, said the day he started. “But it’s something to do and it’s great benefits and we’ll see where it goes.”
It has never been easy to get older, need a good full-time job and not have one. But that’s the predicament now for more Americans than ever, and the challenge has gotten steeper in the prolonged recovery. Millions of workers in their 50s and 60s are drifting into the perilous intersection of unemployment, underemployment and retirement.
It’s getting tougher for Minnesotans to avoid the state’s taxes by spending part of the year somewhere else.
Snowbirds and high earners are discovering that they must do more than buy a condo in the Sun Belt and register a vehicle there, after a court decision last year reinforced the state’s ability to use any of more than two dozen criteria to determine who is a Minnesota resident.
“People refer to it as Hotel Minnesota,” said Matt Shea, a lawyer at Gray Plant Mooty. “You can come any time you like, but you can never leave.”
Minnesota soon could see at least a sevenfold expansion of solar power.
In an unprecedented ruling, a judge reviewing whether Xcel Energy should invest in new natural gas generators vs. large solar power arrays concluded Tuesday that solar is a better deal.
If the finding by Administrative Law Judge Eric Lipman is upheld by the state Public Utilities Commission (PUC), Edina-based Geronimo Energy plans to build about 20 large solar power arrays on sites across Xcel’s service area at a cost of $250 million.
“It says solar is coming in a big way to the country and to Minnesota,” Geronimo Vice President Betsy Engelking said of the ruling.
Amazon.com Inc. will begin collecting sales taxes from Minnesota customers next week, ending a cost advantage it’s enjoyed over brick-and-mortar retailers in the state.
The news also triggered a mystery.
Online-only retailers don’t need to charge sales tax in Minnesota unless they have physical presence or affiliated business here. Monday’s revelation led to speculation that Amazon may open a warehouse, data center or some other operation in the state or buy an existing firm.
The company was vague about what prompted the change, though it said it “will be required” to do so starting Oct. 1.
9. Left Behind: Job loss buries hopes, careers, Jan. 12
Liz and Bob McLean are on the wrong side of an economic divide.
Not so long ago, they would roar out on a motorcycle trip to Yellowstone, or ride a helicopter down the Colorado River. In 2007, Bob put half the money down on a new pickup and paid cash for a new motorcycle.
Losing their jobs changed everything for the couple from Prior Lake. Bob now drives a school bus for $13 an hour, one-third what he earned when he designed tools to test hard drives for Seagate. Liz, who works in IT, has found new jobs, but she makes less than she did in 2008.
“We don’t go out. We don’t travel,” she said. “We’re figuring out if I can even retire.”
Millions of Americans have moved on from the recession with careers and finances mostly intact, but large groups have fallen behind, perhaps for good. The difference is whether they were able to hang on to their jobs.
Dunkin’ Donuts is poised to roll back into Minnesota.
The nation’s largest doughnut-and-coffee chain, with more than 7,000 locations nationwide, is laying the groundwork “that will get us to about 50 stores in Minnesota,” Steve Rafferty, senior director of U.S. franchising for Dunkin’ Brands, said Friday.
The bulk of those locations would be in the Twin Cities area, along with others in the Duluth, Rochester and Mankato markets. The push into Minnesota is part of a national expansion that saw the chain make inroads last year in Salt Lake City, Dallas, Houston and other markets far from its Massachusetts headquarters.
As for when Minnesotans can satisfy their tastes for crullers, glazed and the occasional cream-filled Dunkin’ Donuts offerings, Rafferty said that appears to be at least 12 to 18 months away.
(Photo -- From the left; Mark Davis, chairman of Davis Family Holdings, Mitch Davis, managing partner, and Marty Davis, present CEO, were photographed at the Cambria production plant on Friday, October 17, 2014 in LaSueur, Minn. RENEE JONES SCHNEIDER)
America is a “chickenhawk nation” where nobody understands the military – Atlantic
“What’s the matter with economics?” An exchange with Alan Blinder – NY Review
Vikings stadium workers don’t sweat the low temps – StarTribune
Do they have an ice cream shortage in Venezuela? It’s debatable – BBC
Housing rents paid by Americans rose by $20bn in 2014 – Bloomberg
Progress made, challenges remain 1 year after Casselton derailment – Grand Forks Herald
What cities would look like if they were lit only by stars – Wired
Best Buy founder Dick Schulze is selling lots of $BBY stock – Biz Journal
Grain elevator on Hiawatha Ave for sale, but who will buy? – StarTribune
40 maps that explain the Middle East – Vox
Happy New Year!
The Asia Pacific region accounts for 33% of global air travel – WSJ
Oil prices fell again on Monday, to lowest level since 2009 – Reuters
The most unpopular companies in America are…cable companies – Marketwatch
New F-150 ads focus on toughness, not fuel economy – Detroit Free Press
Kansas town rallies to fight for a supermarket – NY Times
In German town, Puma and Adidas were like Hatfields and McCoys – WSJ
RealtyTrac: Lots of Millennials moving to Minneapolis – StarTribune
Closing time is nigh for Highland Park Barnes & Noble – Pioneer Press
College football coaches: the ultimate 1 percent – Washington Monthly
Don’t complain too much about air travel. Here’s why – Bloomberg View
An oral history of the Fallon agency – Mpls St. Paul Mag
Comparison photos: How highways diced up Midwestern cities – Univ. of Oklahoma
People born during the Depression are the richest old generation ever – Bloomberg
A visit to the European parliaments leaves people confused – WSJ
“Internet of Things” is soft target for hackers – StarTribune
Statistics is one STEM field where women are flourishing – Washington Post
Real estate experts laud new Target fulfillment center in Memphis – Memphis Daily News
The State Department looks pretty bad on the ISIS beheadings – NY Times
Etihad Airways expands in Dallas, destinations all over Middle East – Dallas Morning News
A roller coaster year for Minnesota dairy farmers – StarTribune
The habits of highly productive writers – Chronicle of Higher Education