Annual state survey reveals highest level of postrecession optimism.
Recent rains and the forecast calling for warmer weather are hopeful signs for Minnesota agribusiness. Meanwhile, there’s another essential sector of the state’s economy showing springtime optimism — manufacturing.
According to “The State of Manufacturing,” the sixth annual survey issued by Enterprise Minnesota, the confidence level among manufacturers is the highest it has been since 2009, about the time the Great Recession hit hard. A full 84 percent of manufacturing executives expressed confidence in their firms’ futures, and those who said they were “very” confident jumped from 28 percent in 2013 to 36 percent. Accordingly, 45 percent of respondents expect spikes in gross revenues in 2014.
If this optimism translates into increased manufacturing activity, it would be further indication that Minnesota’s economic recovery is continuing, if not strengthening. That would be great news for investors, workers and the state budget.
There are several reasons to suggest the rising confidence is justified. A growing global economy has resulted in 23 percent of manufacturers reporting that they ship 11 percent or more of their products internationally, which is also a six-year-high. And the “reshoring” trend is accelerating, too, with about 24 percent of firms reporting that they had brought work back home.
The good news comes with warnings about health care costs, worker shortages and Minnesota’s business climate.
With nearly all (97 percent) of the firms suggesting they expect to maintain or grow their workforces this year, the worker shortage is not an abstraction. It’s a real threat to future growth, especially in Greater Minnesota, where three-quarters report challenges in the “ability to attract and retain qualified workers.” More manufacturers are concerned about the job being done in state government, too: The 51 percent who believe the business climate is on the wrong track is the highest since 2010.
Spring optimism will quickly be followed by summer and fall political campaigns. That’ll give both Republican and DFL candidates a perfect opportunity to explain how they plan to keep the state’s economy on the right track.
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