Dread: Minnesota manufacturing report finds overall anxiety and concerns with the state’s business climate, the economy, and manufacturing sector

Enterprise Minnesota, the official Manufacturing Extension Partnership (MEP) Center for the state, recently released its annual State of Manufacturing survey. The yearly report found unprecedented anxiety among respondents, noting that the sectors’ mood is one of worry paired with concerns about the economy and business prospects; it also revealed that the state’s manufacturing executives believe Minnesota’s business climate is worse than any time in the 16-year history of the survey. The report is a stark difference to sentiments in neighboring Wisconsin. The annual Wisconsin Manufacturing Report, released in November 2024, found Wisconsin manufacturers and respondents both optimistic about the economy and their businesses.

The Enterprise Minnesota 2024 State of Manufacturing, which surveyed over 400 industry executives, business owners, and manufacturers, reports their growing concerns and fears, including:

• Economic anxiety: a record high 56% of respondents believe that the state’s business climate is worse than before (up from 50% recorded last year). This percentage is the highest recorded since the Great Recession in 2008. Per the report, it is also an “alarming trend” over the past four years, in which a growing percentage of manufacturers believe that the state’s business climate is worse than before.
• Downward Hiring trends: only 42% of manufacturers are hiring, the lowest number recorded in the survey’s 16-year history. Additionally, while attracting and retaining a qualified workforce continues to be a major concern with manufacturers, opportunities for job seekers in manufacturing have declined. This year, 58% of manufacturers report having no open positions, as compared to 55% in 2023.
• Smaller Revenue growth and profitability: many respondents reported a decline in revenue and profitability. Just 24% expect an increase in revenue, while 21% expect an increase in profitability. Both metrics are down five points from 2023, and
• Costly HR benefit changes: new legislative mandates, such as the Minnesota paid family and medical leave, which will go into effect January 2026, are adding to the industry’s financial pressures. Respondents indicated that they are anticipating negative financial impacts from the mandate, with 68% expecting a major or minor effect from the payroll tax required to fund the paid family and medical leave program, and such legislative changes make Minnesota a less attractive place to do business, according to 65% of respondents. Of that group, 45% believe it is much less attractive.

Such findings indicate a pervasive feeling within the Minnesota manufacturing sector that the state is heading in the wrong direction—with most believing the fault lies with impending legislative mandates and their expected financial strains and impacts. Respondents are increasingly pessimistic about how their own companies are performing amid the impacts of continuing inflation, recession concerns, and what forthcoming legislative actions will have on their business.