In Rural Minnesota, Residents Facing Economic Challenges, Opportunities

Rural Minnesotans are happy, to a point. They are optimistic, to a point. They see local jobs available, to a point.

“It is kind of a mixed bag,” Executive Director Brad Finstad of the Center for Rural Policy and Development said.

On the down side, for instance, the farm economy suffers from the lowest prices in some time on products like corn and soybeans. National steel issues have held down northeastern Minnesota’s economy, which relies in a large part on mining taconite to supply the steel industry. Infrastructure such as roads, water systems and sewage treatment plants need updating.

However, it also is easy to find good rural news. The number of rural jobs is increasing, with many requiring advanced education, and thus paying good money. Many young people say they are interested in taking on community leadership roles, which could keep them in rural Minnesota instead of fleeing to urban areas. And the November election drew more attention to rural needs.

“It is mixed and it is challenging,” President Bob Kill of the Enterprise Minnesota consulting firm said about the rural economy. “It is more challenging because the workforce challenge … is more challenging in rural Minnesota than it is in the metropolitan area.”

Researcher Carol Russell of Brainerd conducted a statewide survey earlier this year for Grand Rapids, Minn.-based Blandin Foundation, an organization that works on rural Minnesota issues. The 2016 survey is the latest effort that dates back years.

“What we are saying, again, is it’s about jobs,” Russell said. “The reality is the economy has improved, particularly in places like central Minnesota … but we are seeing concern that there are not adequate living-wage jobs.”

The survey and interviews with people who know the rural Minnesota economy show that things are getting better in rural Minnesota, but people who live there feel those in the seven-county Twin Cities area and in bigger greater Minnesota cities are better off.

For instance, the Blandin Rural Pulse survey show that while nearly a third of rural residents felt the economy — and their wages — improved in the past year, half felt living-wage jobs in their communities are inadequate. At the same time, Rural Pulse found a quarter of urban residents felt that way.

“Nearly half of our state’s population lives in rural places, and Rural Pulse results remind us that economic recovery is not yet reaching all Minnesotans,” Blandin CEO Kathleen Annette said.

While state employers keep adding jobs, about 80 percent are in the Twin Cities.

Seventeen percent of rural Minnesotans, and 21 percent of urban residents, do not expect to live in the same community in five years. However, Russell said, for rural residents that often means moving to urban areas while urban residents may just be looking toward the suburbs.

Minnesota politicians like to say the state is “one Minnesota,” but there are big differences and needs,

“For starters, the fact that rural Minnesota … does not feel their voice is being heard (shows) that the rural-urban divide is a very real thing,” Russell said.

As Kill said: “When you drive two hours from the Twin Cities and you are in Willmar, it is a different community.”

The more rural, the more challenges manufacturers face, Kill added.

Many rural businesses depend on farming, including many farm equipment manufacturers. The successful ones, Kill said, have learned to diversity so they do not depend as much on the ups and downs of farm cycles.

One of the key Rural Pulse findings showed that urbanites think state leaders care more for rural Minnesota than rural residents think.

The survey showed 69 percent of those in urban areas felt legislators and other policymakers care as much for rural issues as they do big-city issues. But just 57 percent of rural residents felt that.

Since Rural Pulse began in 1998, rural Minnesotans’ feelings about the economy were best in 2000 and worst in 2010. This year, 31 percent think the economy has improved in the past year, the same percentage as 1998 and just below the 2000 level.

Some organizations are working to change the rural-urban disparities. One is Growth and Justice, a Twin Cities-based research and advocacy organization that develops proposals its leaders feel will benefit the state. It generally has focused on the whole state, but President Dane Smith said it is working with rural groups to establish a program to help greater Minnesota.

The Rural Minnesota Equity Project would, among other things, seek more state financial help in developing things like transportation, housing and broadband. Smith said Local Government Aid to cities also needs a boost.

“There is a case to be made that we have not put enough into these basics,” Smith said.

Smith, a former political reporter, said that even though Republicans who will be in charge of the Legislature next year generally do not favor increasing spending, they were sent to St. Paul to bring home programs like the new project proposes.

“The idea is to improve parity with the metro region for the basic infrastructure,” Smith said. “Housing really is a prime target for investment.”

“It is a hidden challenge,” Kill said about housing issues.

Some big manufacturing communities, from Jackson in the south to Thief River Falls in the north, lack enough housing for their workers. That forces them to bus employees to work.

With more than 3,000 manufacturing jobs available in greater Minnesota, the housing situation is not getting better.

One positive aspect of rural Minnesota, Kill said, is that many workers in urban areas consider a job just a job, but in rural areas it often is a career.

Kill said that manufacturers he consults, like others in rural Minnesota, “are fighting a challenging battle, but it is not a losing battle.”

 

And the survey says …

The Blandin Foundation surveyed Minnesotans earlier this year to get their feelings on rural issues. Here is a sample:

— 49 percent of rural Minnesotans think the local economy is about the same as a year ago, while 31 percent said it is better and 18 percent said it is worse.

— The number of people who think there are adequate rural Minnesota wages has increased, with 32 percent saying that in 2010, 38 percent in 2013 and 47 percent this year.

— 43 percent of rural Minnesotans say their income stayed the same in the past year, about the same as when Rural Pulse survey was conducted in 2010 and 2013. This year, 33 percent said pay increased and 22 percent said it went down. However, 41 percent of urbanites said their pay went up.

— Households with pay increases ranged from 21 percent in the northeast to 39 percent in west central Minnesota. Decreases generally came to younger people, while more increases came for those in the 24 to 34 age range. The wealthier the people, the more likely they got raises.

— 39 percent of rural residents 18 to 24 years old do not expect to live in the same community in five years, while 21 percent of those 25 to 34 expect to move. Just 8 percent of those older than 65 think they will move.

— 71 percent think their rural community is a welcoming place for people of all backgrounds, compared to 82 percent three years ago.