Economy of Minnesota

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The economy of Minnesota produced $234 billion of gross domestic product in 2005.^[1] Minnesota headquartered 34 publicly-traded companies in the top 1,000 U.S. companies by revenue in 2007.^[2] This includes such large companies as Target, and UnitedHealth Group. The per capita personal income in 2004 was $36,184, ranking eighth in the nation.^[3] The median household income in 2005 was approximately $52,024, ranking eleventh in the nation.^[4]

1 Income and retail
2 Industry and commerce
3 Minnesota's largest companies
4 Energy use and production
5 State taxes
6 Gaming
7 References
8 External links

[edit] Income and retail

Average household incomes range from $17,369 in Todd County to $42,313 in Hennepin County. Salaries are highest in the urban and suburban counties of the twin cities metropolitan area. Retail sales per capita were $10,260 in 1997, higher than the U.S. average of $9,190. The Twin Cities suburb of Roseville has the highest per capita sales, which recorded $14,870 per capita, but total revenues are much higher in Minneapolis, St. Paul, Bloomington, and Edina.

[edit] Industry and commerce

Corn field

Minnesota's economy has transformed in the past 200 years from one based on raw materials to one based on finished products and services.

The earliest industries were fur trading and agriculture. Agriculture is still a major part of the economy even though only a small percentage of the population, less than 1% are employed in the farming industry.^[5]

Minnesota is the U.S.'s largest producer of sugar beets, sweet corn, and green peas for processing and farm-raised turkeys.^[6] State agribusiness has changed from production to processing and the manufacturing of value-added food products by companies such as General Mills, Cargill, Hormel Foods Corporation (prepackaged and processed meat products), and the Schwan Food Company (frozen foods).

Red pine forest

Iron Range near the Mesabi Trail

Forestry, another early industry, remains strong with logging, pulpwood processing, forest products manufacturing, and paper production. The amount of forested land in the state is declining, from 16.7 million acres (68,000 km²) in 1990 to 16,200,000 acres (66,000 km²) in 2004; however, the average forest is maturing. From 1999 to 2004 the average annual growth within the state was 550 million board-feet (1,300,000 m³) of timber, while the average amount harvested was only 330 million board-feet (780,000 m³) per year.^[7]

Cement carrier and storage vessel, Lake Superior, Duluth, Minnesota

Minnesota was famous for its soft-ore iron mines which produced a significant portion of the world's iron ore for over a century. Although the pure ore is now depleted, taconite mining remains strong using processes developed locally to save the industry. In 2004 the state produced 75 percent of the usable iron ore in the country.^[6] 3M (formerly Minnesota Mining and Manufacturing Co.) today is a diversified manufacturer of industrial and consumer products. The port of Duluth was created by the mining boom and today continues to be an important shipping port for the Midwest's agricultural and ore products.

Manufacturing was not left out, either. The brass era automobile maker Dan Patch was founded in Minneapolis in 1911.^[8]

Retail is represented by Target Corporation, Best Buy, and Supervalu, all headquartered in the Twin Cities. Southdale Center, the first fully-enclosed and completely climate-controlled shopping mall in the United States opened on October 8, 1956, in the suburban city of Edina. The largest shopping mall in the United States, the Mall of America, is located in Bloomington.

Medtronic and St. Jude Medical represent a growing biomedical industry spawned by university research, and Rochester is the headquarters of the world-famous Mayo Clinic. UnitedHealth Group is the second largest health insurance company in the U.S.

Financial institutions include U.S. Bancorp, TCF Bank and Ameriprise; insurers include Travelers Companies and Thrivent Financial for Lutherans.

As might be expected in state with a love of the outdoors, boats and other recreational products are manufactured by a number of Minnesota companies, including Polaris Industries and Arctic Cat, who make snowmobiles and ATVs, Alumacraft Boat Company, and Lund Boats.

An active high-technology sector is represented by Alliant Techsystems, Cray, Imation, and a large IBM plant in Rochester.

Today, the most salient characteristic of the economy is its diversity; the relative outputs of its business sectors closely match the United States as a whole.^[9]

[edit] Minnesota's largest companies

A Mayo Clinic atrium, Rochester, Minnesota

[edit] Nonprofits

The following table lists the Minnesota-based non-profit organizations among the largest 400 in the U.S. by 2006 private donations.^[10]

State Rank by Revenue	Name	National Rank	Donations ($millions) 2006 estimate	Headquarters City
1	Mayo Clinic	45	265.9	Rochester
2	University of Minnesota	46	265.4	Minneapolis
3	Scholarship America	114	136.2	St. Peter
4	Minnesota Public Radio	378	40.3	St. Paul
5	Hope for the City	379	40.3	Edina

Cargill salt harvesting, Newark, California

Part of Carlson Companies, a Radisson hotel in Berlin

[edit] Private companies

The following table lists the privately-held companies headquartered in Minnesota with 2006 revenues over $1 billion.^[11]

State Rank by Revenue	Company Name	National Rank	Revenue ($millions) 2006 estimate	Employees	Headquarters City	Known for
1	Cargill	2	69,900	141,400	Minnetonka	Farm Products
2	Carlson Companies	44	4,930	57,000	Minneapolis	Lodging
3	Schwan Food Company	77	3,380	22,000	Marshall	Dairy Products
4	Andersen	94	3,000	16,000		General Building Materials
5	Petters Group Worldwide	154	2,200	3,200	Minnetonka	Recreational Goods, Other
6	Holiday Cos	204	1,740	4,200		Grocery Stores
7	Taylor	209	1,710	15,000	North Mankato	Publishing - Periodicals
8	Michael Foods	305	1,240	4,132		Dairy Products
9	M A Mortenson	337	1,160	1,800		Heavy Construction
10	Genmar Holdings	353	1,100	5,400		Recreational Goods, Other
11	Lifetouch	370	1,070	22,000		Business Services

Target Corporation, Minneapolis, Minnesota

Best Buy is headquartered in Richfield, Minnesota

Travelers Companies headquarters, Saint Paul, Minnesota

[edit] Public companies

The following table lists the public companies headquartered in Minnesota with 2006 revenues placing them in the 1000 largest U.S. companies.^[2]

State Rank by Revenue	Company Name	National Rank	Revenue ($millions) 2006 estimate	Headquarters City	Known for
1	UnitedHealth Group	21	71,542	Minnetonka	-
2	Target	33	59,490	Minneapolis	Retailing
3	Best Buy	72	30,848	Richfield	Retailing
4	Travelers Companies	89	25,090	St. Paul	P & C, Prof. Liability Insurance
5	3M	97	22,923	Maplewood	Diversified manufacturing
6	Supervalu	117	19,864	Eden Prairie	Food Distribution
7	U.S. Bancorp	123	19,109	Minneapolis	Banking and financial services
8	CHS, Inc.	166	14,384	Inver Grove Hgts.	Fuel Distribution
9	Northwest Airlines	195	12,568	Eagan	Airline
10	General Mills	213	11,640	Golden Valley	Food Processing
11	Medtronic	222	11,292	Fridley	Medical Devices
12	Xcel Energy	251	9,848	Minneapolis	Electricity Production and Dist.
13	Ameriprise	297	8140	Minneapolis	Financial Planning
14	Land O'Lakes	329	7,102	Arden Hills	Dairy Products
15	C.H. Robinson Worldwide	349	6,556	Eden Prairie	Logistic Services
16	Thrivent Fin. for Lutherans	370	6,165	Minneapolis	Financial Products
17	Hormel Foods	403	5,746	Austin	Meat Processing
18	Mosaic	427	5,306	Plymouth	Fertilizer Mfg.
19	Ecolab	457	4,896	St. Paul	Sanitation Supplier
20	Nash Finch	476	4,632	Edina	Food Distribution
21	PepsiAmericas	531	3,972	Minneapolis	Bottling
22	St. Jude Medical	605	3,302	St. Paul	Medical Devices
23	Alliant Techsystems	617	3,217	Edina	Defense Contractor
24	Pentair	623	3,155	Golden Valley	Water Treatment
25	Valspar	653	2,978	Minneapolis	Paint and Coatings
26	Patterson	719	2,615	St. Paul	Dental and Veterinarian Supplies
27	Minnesota Life	756	2,450	St. Paul	Life Insurance
28	Regis	761	2,431	Edina	Hair Salons
29	Toro	909	1,836	Bloomington	Power lawn tools
30	Fastenal	918	1,809	Winona	Fastener Manufacturer
31	Donaldson	948	1,694	Minneapolis	Filtration Products
32	Polaris Industries	962	1,657	Medina	Snowmobiles and ATVs
33	Deluxe	969	1,640	Shoreview	Check Printing
34	Imation	995	1,585	Oakdale	Data Storage Products

[edit] Energy use and production

See also: Common ethanol fuel mixtures

Wind turbines in western Minnesota

The state does not produce any petroleum of its own but boasts the largest oil refinery of any non-oil-producing state, the Pine Bend Refinery. As of 2001, Minnesotans were using a total of 7.2 million gallons of gasoline per day, and fuel use rises in the region by about 2% annually. About 70% of the gasoline fuel used in the state comes from Pine Bend and the nearby St. Paul Park Refinery, while most of the rest comes from a combination of the Mandan Refinery in North Dakota, and the Superior Refinery in Superior, Wisconsin. 40 to 50% of Pine Bend's output is used within the state. Flint Hills is currently planning a $100 million expansion to increase capacity at the plant to about 330,000 barrels per day (52,000 m³/d). Petroleum from the north comes to the state through one of the longest pipelines in the world, the Lakehead Pipeline and the Minnesota Pipeline. Additional crude comes from the south via the Wood River Pipeline.

United States Postal Service vehicle advertising E85, Saint Paul, Minnesota

Ethanol fuel is produced in the state, and consumer gasoline is required to contain 10% ethanol (E10). As of 2006, Minnesota is the only U.S. state with such a mandate. 20% ethanol (E20) will be mandated in 2013.^[12] Minnesota has the highest number of fuel stations offering E85 fuel, with 300 statewide.^[13] A 2% biodiesel blend has also been required in diesel fuel since 2005. Electricity-producing wind turbines have become popular, particularly in the windy southwest region on the Buffalo Ridge. As of November 2006, the state is the country's fourth-largest producer of wind power, with 812 megawatts installed and another 82 megawatts planned.^[14]

Like other Midwestern states that experience cold winters, Minnesota is heavily dependent on natural gas for home heating. Just over two-thirds of homes use the fuel.

[edit] State taxes

Minnesota's income tax is slightly progressive with three rates, 5.35%, 7.05% and 7.85%.^[15] The sales tax in Minnesota for most items is 6.5%. The state does not charge sales tax on clothing, some services, or food items for home consumption.^[16] The state legislature may allow municipalities to institute local sales taxes and special local taxes, such as the 0.5% supplemental sales tax in Minneapolis.^[17] The cities of St. Paul, Rochester, Duluth and St. Cloud have similar taxes. Excise taxes are levied on alcohol, tobacco, and motor fuel. The state imposes a use tax on items purchased elsewhere but used within Minnesota. Owners of real property in Minnesota pay property tax to their county, municipality, school district, and special taxing districts. The overall state and local tax burden is calculated to average 11.9% in 2006, ranking 4^th highest in the country.^[18]

[edit] Gaming

Minnesota residents and visitors can legally gamble on the lottery, for instance; its games include Powerball, Hot Lotto, both multi-state games, Gopher 5, Northstar Cash, and numerous scratch tickets.