Chamber charts business climate
Despite the constant tug of war over funding, Minnesotans remain proud of the state's public education system. But how do the state's students stack up against those in other comparable metro areas?
In the marketplace, that question matters. As do factors such as workforce development, quality of life and business climate measures -- the three key categories used for comparison in a new Minneapolis Regional Chamber of Commerce "MSP Business Vitality Index." The index is designed to equip business leaders with key figures about our region's economy.
It's a smart study, and if it becomes a benchmark to measure how the region is competing against markets of similar size and scope, it can be a blueprint for business leaders to prioritize public policies that strengthen not just the 11-county metro area but the entire state.
Launched as an attempt to "narrow countless statistics and rankings to a manageable selection of figures," the comparative set of 10 markets includes regional centers such as Denver, Seattle, Phoenix, St. Louis, San Diego, Cleveland and Charlotte, as well as the relatively smaller markets of Portland, Ore., and Austin, Texas. While one significantly bigger metro area, Boston, is included, the study does not include New York, Chicago or Los Angeles.
There are some surprises in the analysis. As expected, we rank highly on quality of life measures, especially when they involve civic virtues such as volunteerism and voter turnout. And despite a questionable reputation in some quarters, the Marketwatch website named the Twin Cities the best place in the nation, not just the 11-market competitive set, to do business.
But there are challenges, as well. We seem to do "big" well, with top rankings in the number of Fortune 500 companies per capita and the top bank concentration index. Yet the small, entrepreneurial efforts that are the incubator for big companies are less robust, as evidenced by middle rankings for venture capital and patents per capita as well as for small-business development. Most troubling is what is usually assumed to be the state's strength: education. True, we're tops in high school graduates, with 92.2 percent earning diplomas. But we slip to No. 3, with 36.5 percent of adults with bachelor's degrees, and an even lower No. 6, with 11.7 percent of adults with advanced degrees.
As for our "Prairie Home Companion" kids, they may not even be average, let alone above it, if a big gap in early childhood education isn't closed. The region ranks No. 7, with 45.8 percent of 3- to-4-year-olds enrolled in a public or private school, compared with top-ranked Boston's 59.4 percent.
This may be the key figure to focus on, with brainpower driving the information age economy. "I'll go back to human capital and how successful we are in getting our kids through high school and on to college," said Art Rolnick, senior vice president and director of research for the Federal Reserve Bank of Minneapolis, who has been an outspoken advocate for early childhood education. "That's the thing that's ultimately going to determine if we have a chance of continuing our economic success. If we fall down there, that's a real red flag."
Minnesota Gov. Tim Pawlenty and the 2010 Legislature should keep that in mind as they try to balance the state's budget challenges with what's needed to invest in better times ahead. Education is a huge expense, but it's also one of the most important. The region's business leaders, with the help of the new Business Vitality Index, also look at it as an investment that will pay both corporate and civic dividends for years to come. -- Minneapolis Star Tribune