Manufacturing remains the largest private-sector component of Minnesota's economy, contributing $48.6 billion of the state's gross domestic product (GDP).
So it's no surprise the sector has the largest presence on the Star Tribune 50, contributing more than half of the companies. However, because manufacturers take only three of the top 10 spots on the list, they represent only 19.6 percent of total sales and 30.9 percent of total profits of companies on the list.
As far as market capitalization, the sector represents 31.1 percent of the total from the list, and 12.1 percent of total assets.
If tariff and inflation pressures don't change the equation, most manufacturers expect to remain on an upswing for the rest of the year. The nine-state Mid-America Business Conditions Index — with 50 being neutral growth — was 67.3 in May, its highest in 14 years, and manufacturers said they expected growth to continue in the next three to six months.
3M, based in Maplewood, took the fourth spot on the Star Tribune 50 list. The international giant played a big role in powering the Dow Jones industrials index last year and is building on what CEO Inge Thulin said was a strong finish to 2017.
Officials at St. Paul-based Ecolab — 10th on the list — pointed, like 3M, to growth across all major business units.
But cost pressures are having a bigger effect on food companies such as General Mills, ranked seventh on the list, and Austin-based Hormel, ranked 13th. Even with the growth of key products such as cereal and yogurt for General Mills and lunchmeat and bacon for Hormel, analysts are worried about warnings of higher trucking and other costs eating into profits this year.
After missing its third-quarter profit outlook in March, Golden Valley-based General Mills shares plunged 9 percent, the biggest single-day drop in nine years.
The cost pressures come on top of a shift in consumer preferences, with fewer people buying packaged or processed foods.
Still, food companies are the biggest employers among Minnesota manufacturers, according to the state Department of Employment and Economic Development.
Hiring will be the sector's biggest challenge in coming years, according to Enterprise Minnesota and other trackers of the state's economy.
Manufacturing jobs have increased 9 percent since 2010, according to an analysis by Deloitte. However, since 2011, the number of manufacturers that are having trouble finding qualified staff has doubled.
The state unemployment level is at a 17-year low, so the tight economy is hitting all sectors. But manufacturers have told Enterprise Minnesota and Creighton University — which produces the Mid-America index — that the worker shortage could hamper growth.