“When the facts change, I change my mind,” the economist John Maynard Keynes is supposed to have said. “What do you do, sir?”
Back in April, I wrote: “It’s official: Minnesota is now a below-average per capita income state.”
Minnesota has long been able to offer a “premium” for living in the state in terms of a level of GDP per capita which was above the national average. The weather might be brutal and the sports franchises likewise, but higher than avereage per capita incomes made up for that. As Figure 1 shows, as recently as 2014, GDP per capita in Minnesota was $4,658 above that of the United States generally, or $18,632 for a family of four. In every year since 2014, that permium has fallen until, last year, it vanished completely and Minnesota became, for the first time on record, a state with below average per capita GDP.
This fact is part of our “Wrong Track MN” initiative.
But facts — or, more exactly, economic statistics — can change. Last week, the Bureau of Economic Analysis (BEA) released new numbers for Gross Domestic Product (GDP) across the states for 2018 to 2025 and the news was bad for Minnesota. As Table 1 shows, all of our state’s revisions were down and we had the third biggest average reduction among the 50 states.
Table 1: Revisions to real GDP
The population numbers have not changed, however. The result is that, in recent years, our performance on the key metric of per capita GDP is even worse than I wrote in April.
As Figure 1 shows, it is now the case that as recently as 2014, GDP per capita in Minnesota was $4,658 above that of the United States generally, or $18,632 for a family of four. In every year but one since 2014, that permium has fallen until, in 2023, it vanished completely and Minnesota became, for the first time on record, a state with below average per capita GDP. In 2025, Minnesota’s per capita GDP was $2,767 below that of the United States generally, or $11,068 for a family of four.
Figure 1: GDP per capita in Minnesota minus GDP per capita for the United States, 2017$
Minnesota’s below average economic performance, which is worse than previously thought, is a long standing problem which must have deep rooted causes. In an upcoming report I will dig into the data to see what these are.