For nearly two decades we have urged Michigan economic policy makers to use Minnesota as a model. Because Minnesota across the board has the Great Lakes best economic outcomes. From low unemployment to high labor force participation to better than the nation personal income and education attainment Minnesota is far ahead of Michigan.
We also chose Minnesota because it is a cold-weather, non-coastal, neighboring state. Taking off the table that Michigan’s poor and declining outcomes are because of the weather or the apparent advantages of states on the two coasts.
Now that demographic challenges––more Michiganders leaving than entering the labor market––are becoming policy priorities, once again Minnesota is a model. With by far the best results for decades in the Great Lakes.
Highlighted by Minnesota being the only Great Lakes State that has not lost a congressional seat from 1960 on. Each decade from 1960 on Minnesota has had 8 congressional seats. In 1960 Michigan had 19 congressional seats, today it has 13. Michigan has lost at least one seat in congress each of the last five decades. The last time Michigan had as few as 13 congressional seats was the 1920s.
Not losing a congressional seat since 1960 means Minnesota’s population has grown at near the same rate as the nation’s for the last six decades. Its 2020 population is 167 percent larger than it was in 1960. Minnesota’s population growth is concentrated in metro Minneapolis. The region’s population in 2020 is 217 percent of what it was in 1960.
Over that same time period Michigan’s population has grown 128 percent. If Michigan’s population growth since 1960 had been the same of Minnesota’s, Michigan population would be around 13 million rather than the 10 million it is today.
It’s not just Michigan, all the other Great Lakes states have lost congressional seats since 1960:
- Illinois from 24 to 17
- Indiana from 11 to 9
- Ohio from 24 to 15
- Wisconsin from 10 to 8
Minnesota’s population growth demonstrates that much of what passes for conventional wisdom when it comes to where people are choosing to live post pandemic is not accurate. So much for the conventional wisdom that people are fleeing cold weather places. So much for the conventional wisdom that people are fleeing high density places––particularly big cities. So much for conventional wisdom that people are fleeing high tax places.
Rick Haglund’s conclusion in our Minnesota case study describes Minnesota’s decades-long strategy that has led to its Great Lakes leading economic and demographic outcomes:
Lawmakers and governors in many states, including Michigan, have focused primarily on cutting taxes and shrinking the size of their governments as the path to prosperous economies.
As this report has shown in detail, Minnesota has traveled a different path. There is no question Minnesota is a high tax state—as stated earlier, its residents paid $2,145 (updated for 2021) more than Michigan residents in state taxes alone.
But it has largely invested that additional revenue in services and investments that matter in a knowledge-based economy. An educated work force, efficient transportation systems, vibrant cities and metropolitan areas, and a secure safety net for those making the transition to a global economy all matter in creating a prosperous state.
Minnesota has made those necessary investments and enacted policies making the state welcoming to all. It really shouldn’t be surprising, then, that it has the strongest economy in the Great Lakes region and one of the most vibrant in the country.
