THE ECONOMIC NECESSITY OF IMMIGRATION REFORM William A. Blazar, Senior Vice President, MN Chamber of Commerce Maura G. Donovan, Executive Director, Economic Development, University of Minnesota
www.mnbic.org MN BUSINESS IMMIGRATION COALITION Broad base chambers, agriculture, hospitality, food processing Education 5 reports since 2009 Statewide forums build understanding & support Federal reform principles 2013: broad support State policy appears unavoidable & challenging
WHY IMMIGRATION REFORM? It s the economy
IMMIGRANT CONTRIBUTIONS TO MN S ECONOMY Workers Entrepreneurs Consumers Connect us to world economy Key to MN s development & growth
Report: Immigrants and Minnesota's Workforce January 2017 The Committee on Minnesota Workforce & Immigrants Report and appendices available for download at http://z.umn.edu/immigrantworkforce
Minnesota Population Trends Population projected to grow at slower rate beginning 2030 Projected Change in MN Population by County (2015-2045) Population will age & become more diverse but not evenly across the state Report and appendices available for download at http://z.umn.edu/immigrantworkforce
2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037 2039 2041 2043 2045 2047 2049 2051 2053 2055 2057 2059 2061 2063 2065 2067 2069 Population and Workforce In 2040 the number of deaths in the state > than the number of births Minnesota will become dependent upon in-migration for population growth 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0-5,000-10,000 Projected Annual Population Change in Minnesota, 2015-2070 Natural Change (Births - Deaths) Net Migration Note: Calculations based on data from Minnesota State Demographic Center, Minnesota Population Projections (2015-2070), August 2015 Report and appendices available for download at http://z.umn.edu/immigrantworkforce
International Migration Driving Growth 14000 12000 10000 8000 6000 4000 2000 0-2000 -4000-6000 -8000 Average Annual Net Migration to Minnesota 11935 9344 7577 3251 Domestic Net Total Net International Net -4358-6093 2005-2010 2010-2013 Source: U.S. Census Bureau, Population Estimates Program, Minnesota State Demographic Center
1970 1980 1990 2000 2010 Percentage Immigrants in Minnesota MN lags U.S. in foreign born population Foreign Born Population in the United States & Minnesota, 1970-2010 14 United States Midwest Minnesota 12 Minnesota s foreign born population includes a large number of refugees 10 8 6 4 2 0 Report and appendices available for download at http://z.umn.edu/immigrantworkforce
Slowing Labor Force Growth Worsening gap between the number of jobs available in Minnesota and the number of workers present to work at those jobs Shortage of workers could decrease economic growth Actual and Projected Minnesota Labor Force and Employment, 1990-2024 Note: Based on historical and projected employment and labor force data by the Minnesota Department of Employment and Economic Development. Report and appendices available for download at http://z.umn.edu/immigrantworkforce
An Immigrant Workforce Future strength of economy depends on attracting & integrating immigrants into workforce Foreign Born Population in MN by County (2010-2014) MN must use existing human capital & increase skills for immigrants Report and appendices available for download at http://z.umn.edu/immigrantworkforce
WORKER SHORTAGE: WHAT DO WE DO? Automate Grow elsewhere Support in-migration
EDUCATION: MN S IMMIGRANTS, 2 EXTREMES Immigrant Education Levels Native Education Levels 43.8 14.7 22.7 18.7 Graduate degree Bachelor's GED, some college, or AA HS diploma or less 32.3 10.4 35.6 21.7
Workers at SterilMed Maple Grove, MN
INDUSTRIES FUELED BY IMMIGRANT WORKERS Industry % of Foreign- Born workers working in the industry % of Native-Born workers working in the industry Manufacturing 20% 13% Retail Trade 8% 12% Professional, Scientific, Management and Admin Education, Health and Social Services Arts/Entertainment, Recreation, Accommodation and Food Service 14% 9% 23% 24% 11% 8% Source: Migration Policy Institute 2009
KEY WORKERS IN SHORT SUPPLY (2015-16 Grow MN! Results, N = 436) % Companies Job Type # of Companies Seeking Workers Reporting Recruitment Difficulty Construction, Trades Workers 76 83% Production and Assembly 73 85% Architect, Engineer, Cartographer 43 93% Sales Agents, Real Estate Agents 49 82% Installation, Maintenance, Automotive 23 95% Executives, Managers 34 76% Healthcare Support Personnel 26 96% Transportation and Moving Personnel 19 95% Office Support and Assistants 40 82% Food Preparers, Chefs, Servers 23 89% IT and Web, Actuaries, Statisticians 21 76%
ENTREPRENEURS 6% of MN businesses are immigrant-owned. 16,000+ Immigrant Entrepreneurs $289 million in sales, 2014 60,000 employed, 2007 Neighborhood revitalization South St. Paul MPR 2011, Concordia University 2011, CLAC, LEDC Susan Rani, Rani Engineering Minneapolis
FORTUNE 500 COMPANIES IN MN (2016) WHAT DO THEY HAVE IN COMMON? State Ranking Company Name Fortune 500 Ranking Revenues ($ billions) 1 United Health Group 6 157 2 Target Corporation 38 73.8 3 Best Buy 71 39.7 4 CHS 84 34.6 5 3M 93 30.3 6 U.S. Bancorp 131 21.5 7 Supervalu 160 17.8 8 General Mills 161 17.6 9 Ecolab 206 13.5 10 C.H. Robinson Worldwide 208 13.5 11 Land O Lakes 215 13.1 12 Ameriprise Financial 232 12.2 13 Xcel Energy 257 11 14 Hormel Foods 304 9.3 15 Mosaic 316 8.9 16 Thrivent Financial 318 8.7 Source: Twin Cities Business Magazine http://tcbmag.com/news/recent-news/2016/june/minnesota-company-cracks-fortune-500-top-ten-for-f
IMMIGRANTS LEAD MAJOR MN BUSINESSES 38.9% of Fortune 500 companies in Minnesota were started by immigrants or their children. more than 264,000 jobs annual revenue over $100 billion Immigrants lead 3M, Lifetime Fitness, Medtronic, Best Buy, Mosaic, DeCare Source: Partnership for a New American Economy, Minneapolis/St. Paul Business Journal
CONSUMER POWER Minnesota s immigrants have consumer power over $8.9 Billion per year.
CONNECTING MN TO THE WORLD Foreign investment & expertise are key to growth. MN s steel & mining industries: ArcelorMittal Steel (Virginia): India Gerdau (St. Paul): Brazil Twin Metals (Biwabik): Chile Polymet (Hoyt Lakes): Canada Food processing: Faribault Foods (Faribault): Mexico Bimbo Bakeries (Twin Cities): Mexico JBS (Worthington) Brazil Immigrants add diversity that says, World Economy Welcome Here!
MN S ECONOMIC REALITY 2030 Population ages Labor force growth declines New enterprises critical to growth Main Street needs more shoppers Need foreign $$$ & expertise Immigrants KEY to MN development & growth
CONTRIBUTIONS CHANGE OVER TIME HMONG MN EXPERIENCE 1980 2010 Median Age 37 19.7 College Graduates 5% 12.6% Workforce Participation Rate 27% 59% Median Household Income $17,481 $49,400 Household Receiving Public Assist 67% 14% Homeownership Rate 12% 49% Median Home Value $85,927 $161,100 Compiled by Dr. Bruce Corrie, Concordia University, St. Paul
IMMIGRANTS: 1st CONGRESSIONAL DISTRICT Immigrant Population % of Total Population 2014 1 st District Minnesota 1 st District Share of Total 37,166 437,544 8.5% 5.6% 8% Taxes Paid $283 million $3.3 billion 8.6% Retail Spending $771 million $8.9 billion 8.7% Entrepreneurs 757 16,244 4.7% Source: Partnership for New American Economy 24
1850 1860 1870 1880 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010 Percentage Immigrants in Minnesota An Old Story MN was an immigrant state well into 20 th century! The current trend is not new & we thrived. Foreign Born Population in the United States & MN, 1850-2010 United States Midwest Minnesota 40 35 30 25 20 15 10 5 0 Report and appendices available for download at http://z.umn.edu/immigrantworkforce
Immigration Reform 4 PARTS Streamline Administration E-Verify = Employment eligibility verification Responsiveness to economic change Replace fixed quotas with dynamic system More visas for skilled workers, STEM Recognize differences among industries, e.g. agriculture Earned status for unauthorized workers Secure borders = See above
Immigrants & Community Integration What can Minnesota do to make itself a more attractive place for immigrants? Develop a strategy-important to have community focused conversations Education: retaining foreign students, recognizing foreign credentialing, investing in workers (e.g., English). Addressing racial disparities Diffusing social tensions, managing conflicts Recognizing and coordinating key roles: local government and community organizations, and employers Report and appendices available for download at http://z.umn.edu/immigrantworkforce
Minnesota s Immigrants: a resource for our economy
QUESTIONS & COMMENTS
WORKERS MN s labor force growth depends on imported labor Immigrants = most of our labor force growth 7% of population; 9% of workforce o About 400,000 individuals o 230,000 workers
FOREIGN BORN MN S: GETTING YOUNGER 14% 12.6% 12% 10% 8% 8.5% 25-34 6% 4.8% 55-64 4% 3.3% 3.1% 3.6% 2% 0% 1990 2000 2006 PUMS micro data from 1990 & 2000 Census & 2006 ACS