As we have seen Minnesota has better economic outcomes on every metric that matter to families trying to pay the bills and save for their retirement and their kids college education. Its not close. The main reason for the out performance is that Minnesota is over concentrated in the knowledge-based service industries that have faster employment growth and higher wages. Indiana is under concentrated in those industries.
The main ingredient that allows Minnesota to participate more in the knowledge sectors of the economy is human capital. As Governor Snyder says: “Today, talent has surpassed other resources as the driver of economic growth.” Specifically the proportion of adults with a four year degree or more. Which now is the best predictor of a state’s per capita income. Here again Minnesota is one of the leading states, Indiana near the bottom.
Here are the details:
- Minnesota is 10th in proportion of adults 25 and older with a four year degree or more at 32.4%
- Indiana is 43rd in proportion of adults 25 and older with a four year degree or more at 23.0%
- Minnesota is 8th in the proportion of 25-34 year olds with a four year degree or more at 37.2%
- Indiana is 33rd in the proportion of 25-34 year olds with a four year degree or more at 27.0%
As we have explored extensively, 25-34 year olds are the mobile young talent every state has made an economic development priority. There is a strong case that where they settle will determine whether or not a state will be prosperous or not in the future. If that is true Minnesota is going to continue to be prosperous, Indiana not.
- In 2011 there were 276,000 young professionals in Minnesota compared to 224,000 in Indiana
- From 2006 to 2011 the number of young professionals in Minnesota grew 17.7% in Indiana 6.1%
- Minnesota is 21st in total population and 17th in population of 25-34 year olds with a four year degree or more
- Indiana is the reverse, 16th in total population and 20th in population of 25-34 year olds with a four year degree or more
As is true in most states the difference is in the concentration of college educated adults in their big metro and its central city.
- Metro Minneapolis four year degree attainment rate is 37.2%, metro Indianapolis is 29.2%
- For 25-34 year olds its 42.9% compared to 34.3%
- Metro Minneapolis is home to 226,000 young professionals, metro Indianapolis 100,000
- Minneapolis and St. Paul combined have 62,000 young professionals, the city of Indianapolis (which is a county) 40,000