Yesterday, I wrote about revisions to official data which show that Minnesota’s economic performance in recent years has been even worse than previously thought.
As Figure 1 shows, since that inflection point for per capita Gross Domestic Product (GDP) growth in 2014, Minnesota’s economy has grown at an average annual rate of 1.4%, below 39 out of 50 states.
Figure 1: Average annual real GDP growth, 2014 to 2025
Total GDP is just the sum of the output of each worker, so we can break total GDP growth down into the components that come from 1) more workers and 2) more output per worker.
Using data from the Bureau of Labor Statistics (BLS), Figure 2 breaks down the numbers shown in Figure 1 into those components. It shows that Idaho ranked top out of 50 states for employment growth between 2014 and 2025 and Wyoming last while, for output per worker, Washington came top and Oklahoma came bottom. Minnesota ranked 32nd out of 50 states for employment growth between 2014 and 2025, and 42nd for growth of output per worker. We are some way below the average for both.
Figure 2: Average annual growth, 2014 to 2025
So, Minnesota’s disappointing GDP growth is the result of below average growth in per worker output and employment. These are the problems at the root of Minnesota’s weak economic performance, and we’ll dig into them a bit next week.