Minnesota exported a record $21.4 billion in goods and services in 2014 with small and medium-sized businesses responsible for a significant amount of the exports.
The state’s exports contributed to a record high for the country as a whole in 2014, which hit $2.35 trillion in exports, according to the U.S. Department of Commerce — the fifth year in a row that the country has hit a record level.
In a conference call with federal and state officials Thursday, former Minneapolis Mayor R.T. Rybak said Minneapolis was one of the first cities in the country to better align government resources to help small businesses expand their operations by selling to foreign markets after President Barack Obama announced a goal of doubling the nation’s exports.
He pointed to a small bike dealer in South Minneapolis that now sells bike racks in Europe and a sailboat maker that exports products to Latin America as a couple of businesses that city leaders have helped with trade deals.
“The last thing we need right now is to send the message that the country is not open for business around the globe,” he said. “And the best thing for small businesses in Minneapolis and I would say the whole state is to be able to keep doing what the federal government has done, which is to break down barriers.”
While many think of Cargill and 3M as the dominant players in exports, Minnesota Department of Employment and Economic Development Commissioner Katie Clark Sieban said small and medium-sized business with fewer than 500 employs accounted for 87 percent of the state’s exports. The manufacturing sector is especially robust and growing at a rate twice the national average, she said.
Jeff Zients, director of the National Economic Council, said exports “provide a huge opportunity for small businesses to grow and thrive.”
“Over 300,000 companies export goods, 98 percent of which are small or medium-sized businesses with fewer than 500 employees,” he said. “But more than half of these small and medium-sized enterprises export to just one foreign market. So we have the opportunity to help those businesses grow by setting tough, fair rules that ensure the global economy operates under high standards, not a race to the bottom.”
Goods exported from Minnesota supported an estimated 106,000 jobs in the state, according to the Department of Commerce. Nationwide, 11.3 million jobs are tied to the export industry. On average, export-related jobs pay 18 percent more than other jobs.
“Exports are critical to economic growth and job creation in communities across the country,” said Secretary of Commerce Penny Pritzker. “With 95 percent of the world’s consumers living outside the United States, opening more markets to ‘Made in America’ goods and services is fundamental to our nation’s competitiveness, job creation, and the economic security of our families.”
Leading sectors in Minnesota for exports include computer and electronic products ($3.8 billion), machinery, except electric ($3.2 billion) and transportation equipment ($2.6 billion).
More than $10 billion (47 percent) of the state’s exports went to free trade partners with the U.S. Sales to these partners has increased by 82 percent in the past decade, according to the Department of Commerce. Sales to Canada, Mexico, Singapore, Korea and Australia have been the strongest.
Administration officials are pushing for new trade deals — the Trans-Pacific Partnership (TPP) and Transatlantic Trade and Investment Partnership (TTIP). The agreements have the potential to create new market opportunities for Minnesota and other states with countries in Asia and Europe, among other places.