 Our annual meeting is fast approaching (March 2), and I hope you’ve registered to join us. I also hope you will bring a “friend we haven’t met yet” so they can get acquainted, too. This is the biggest event of the year, a must-attend for our region. In previous years, we have brought in powerful – and national - speakers to inform us and broaden our thinking. This year, our theme is “Investing in Tomorrow.” I’ll be talking about this all year… on so many fronts, change - transition - is upon us.
One of the biggest roadblocks to change is the perception that it’s not in our self-interest. What we know: tomorrow is a certainty; it’s already upon us. And we get to own what’s coming next. Our self-interest absolutely is served as we look to tomorrow’s people, culture, and technology. How can we be better by adapting? Enhancing? What can tomorrow teach us? And what is the “opportunity cost” if we, instead, spend our time admiring the problem? The very nature of a chamber is to bring people together. We start with relationships, cultural residency. We organize around the good thing we want to see happen, and we inspire the innovative spirit. Our Annual Meeting speakers will explore how we position ourselves to capitalize on what tomorrow brings. I look forward to seeing you!
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So last week I wrote about my sense of the economy. If you missed it, I think it’s a worthwhile read – check it out!
What’s on my mind this week? The proposed paid family leave mandate. Amanda has talked about the Paid Family and Medical Leave bills (HF 2/SF 2) in several past editions her Advocacy News. This legislative session is moving uncharacteristically quickly, so the time is now to express your concern with the expansiveness and cost of this proposal. (See attached letter we have shared with the relevant committees.) You can find your legislator here. The Minnesota Chamber has put together an excellent fact sheet on the legislation, along with additional resources you can use in your outreach. To make it personal: as we face a $18B surplus, your Chamber would be paying additional $16,800 in payroll taxes in 2023. Try this yourself find out here how your organization would be impacted. To my mind, the issue isn’t the value proposition of paid leave to care for family or recover from illness. I have two significant issues with this proposed legislation. First: this is a “mandate” rather than an “incentive,” and employers are in the best position to design benefits packages that serve the distinct needs of their employees. This will be devastating to small business. Second: the tails. Using one-time surplus to initiate programs with ongoing budgetary commitments is a dangerous game, especially at a time when business is bracing for an economic slowdown. The Minnesota Chamber is hosting a free, virtual town hall to answer questions on the Paid Family and Medical Leave proposal on Tuesday, February 7 from 12-12:30 pm. You can register here. We can’t sit on the sideline for this one. This is a real opportunity where your voice can make a difference. On another note: we are promoting a few surveys right now – your input is critical! Each should take no longer than 10 minutes, and answers will remain anonymous. :
 Before I get into it, I need a minute. Tell me you aren’t feeling batted about with the horrific killings this year already. The most recent heinous acts of 5 Memphis police officers; killings in LA during the Lunar New Year celebrations; St. Paul’s own shooting at a rec center. And more. CNN tells us, “there have been more mass shootings than days in 2023” thus far. As of the 22d day of the year, there already had been at least 36 mass shootings in the U.S. There are no words to convey adequately our community horror, united sympathy for families. I don’t have any answers; I simply have to pause, with you, in a moment of shared grief.
--------------- I do have one ask for you: we want your feedback on the City of St. Paul's proposal to increase the sales tax by 1% to fund street and park improvements. You can access the short survey here. Your response will inform our thinking so please let us know what you think! Bottom line for my thoughts this week: despite the pressure of high interest rates and fears of recession, the U.S. economy ended 2022 on solid footing. Economic growth remains solid, if slow, largely on the hiring within our amazing small business sector (remember, they’re our economic engine!). We certainly are seeing inconsistency, with select large tech companies laying off, but small companies definitely are still hiring, and both GDP/consumer spending remain in modestly positive growth mode. What remains uncertain is ongoing inflation, with wage growth alongside a job market that is still too tight. Ok then. So let’s look at some data points to fill in:
Our issue in Minnesota? Simply and painfully put, we have a lot of jobs, but not enough workers. As it stands today, the U.S. Chamber’s Worker Shortage Index tells us that, in Minnesota, for every 100 open jobs, we have 43 workers. We’ve got an aging population, and one of Minnesota’s most important sources of new workers, immigrants, largely was cut off by pandemic-related curbs on immigration. Minnesota’s silver bullet? Welcoming more workers. To do so we absolutely are supporting policies and practices that attract workers from out of state and remove barriers to employment for those already here, such as affordable housing and childcare. We also are investing where we can have great impact: our Career Connect Day for youth career exploration as well as adult job seekers; and our first Small Business Summit, to provide hands on resources and training to help our small businesses grow. See you in the trenches. B Last week I talked about “the business lane” as we address our priorities and challenges: public safety, a potential St. Paul sales tax proposal, proposed family leave mandates, housing in a rent control environment, our unsheltered population, all of which impact our success in welcoming and supporting business development. Today I want to talk about two more of these topics: proposed family leave mandates and housing in a rent-controlled environment.
Read more in “It’s Our Business”…. First off, the proposed family leave mandates. Amanda Duerr gave us all the heads up last week that Paid Family and Medical Leave (S.F. 2) had its first Senate committee stop, in the Jobs and Economic Development Committee. This past Thursday Governor Walz released the second of four parts of his budget recommendations, $4.1B in proposals that included the creation of a paid family and medical leave program. The current paid leave proposal being advanced by DFL lawmakers would offer up to 12 weeks of partially paid time off for family reasons. It also would provide up to 12 weeks of medical leave. The program would be funded by a payroll tax (currently proposed at 0.7%, up from 0.6% earlier this month), which would be shared by employers and employees. In addition, the Governor’s budget recommendations call for giving workers up to 48 hours of “sick and safe” time each year. Both proposals are moving through the legislature. The MN Chamber has put together a good one-pager on the proposal. I have a couple of concerns. First, is the tails. The long-term implications to budgets at all levels – government and businesses. Using one-time surplus money to initiate programs with ongoing budgetary commitments is a dangerous game at best. Second, is the “mandate” rather than “incentive” approach. Large companies have strong benefits packages that rival anything the government could require (often better), and the smaller companies already provide as many benefits as they can afford. Charlie Weaver of the MN Business Partnership is referenced in this Star Tribune article as saying, “just do no harm.” Employers are in the best position to design benefits packages that serve the distinct needs of their employees. And companies serious about retaining employees already understand the importance of investing in people. A mandate like this could do some serious harm. Next is housing in a rent-controlled environment. Last week I spoke on a panel about rent control and I shared my observations about how it’s going so far in St. Paul. Lest I get too hyperbolic, let’s stick to numbers that I shared: from 2020 to 2022, St. Paul’s multi-unit housing permits issued (per HUD data) went from 2036 to 937. During the same period, Maplewood’s permits increased from 8 to 148. People, housing development is still happening. It’s just moving out of St. Paul. I also reference a Jan 2022 NMHC survey (National Multifamily Housing Council): the survey indicated that apartment market conditions have generally improved. That said, in rent-controlled markets, 58% of national developers surveyed are reducing or avoiding investment; and of those, 26% are specifically avoiding Minnesota. I absolutely am on the side of those most vulnerable to affordable housing shortages. And I believe rent control is hurting – not helping – our renters. My opposition to rent control has three faces:
What are your thoughts on this? I’d love to know! See you in the trenches. B Front of mind and with me every day is “the business lane” as we address our priorities and challenges: public safety, a potential Saint Paul sales tax proposal, proposed family leave mandates, housing in a rent control environment, our unsheltered population, all of which impact our success in welcoming and supporting business development. Today I want to talk about 2 things: public safety and the proposed 1% sales tax in Saint Paul.
First off, public safety. I had a chance to sit down with St. Paul’s new Chief of Police last week and was encouraged. I conveyed to him our very serious and immediate concerns about lack of accountability, crisis as well as chronic issues around Central Station, youth offenders, lack of prosecution at the County level on offenses that are therefore repeated – by a small group of offenders. All within the context of ensuring employees and visitors alike feel welcome and safe when they enter our beloved city. We had a very candid conversation and I know he feels the weight of his responsibility across these concerns and more. As I told him, business owners have accountability of their own – to clients, tenants, employees. We are wired to deliver on expectations, taking direct charge as needed. Absent a sense of order within a city, those same business owners are inclined to “take matters in their own hands.” My inclination is to give this new Chief a moment. He’s smart, already invested in our community. I want to see how he tackles “accountability.” Second is the proposed 1% sales tax in Saint Paul. On this one, we want to hear from you. Candidly, I’m not philosophically opposed to the use of a sales tax. That said, so much goes into it in this case – the timing, the amount, the restrictions, other taxes/fees/costs business owners have absorbed – or will. With other business-aligned partners, we will be sending out a survey later in January to gather your input. Please let us know what you’re thinking. Your response will inform me as I talk with Mayor Carter about the business perspective on his proposal. You are a diverse community and I anticipate the responses will be as well. That said, we do need your input. And Mayor Carter does want to know what you think! Finally, it’s Annual Meeting time again, and it promises to be our biggest yet. Our theme this year is “Investing In Tomorrow.” Business leaders are adapting to a tomorrow that already is upon us. To my mind, our most important job is to stay relevant as we adapt to tomorrow’s people, culture, and technology. Please join us, and bring a “friend we haven’t met yet.” I look forward to seeing you! See you in the trenches. B |
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