What Business Thinks™ 2007—A Healthy 2007?

That year, a suspected cause of business leaders’ differing perceptions of the state of their companies versus the state of the state was political dissatisfaction. The 2006 survey findings suggest a bit less political discontent.

Hearken back to 2005. Survey participants were asked to evaluate the performance of the Minnesota Legislature “for promoting an agenda that is good for business.” A contentious and unproductive 2005 legislative session inspired business leaders to render an “excellent” rating of 0 percent. Governor Tim Pawlenty fared better—18 percent rated his performance “excellent,” and 40 percent gave him a “good” rating.

In 2006, Pawlenty received slightly higher marks—21 percent rated his performance “excellent” and 41 percent rated it “good.” He was able to move ahead on some delayed projects. In the spring, he signed a bill that authorized bonds for nearly $1 billion in construction projects throughout the state. He also signed stadium bills for the Minnesota Twins and the University of Minnesota’s football team. The state legislature also benefited a bit from a more productive 2006 session. Though just 2 percent of survey participants rated the legislature’s performance “excellent,” only 18 percent turned in a “poor” vote, well down from 48 percent in 2005.

The 2006 survey (conducted before the November election) also asked business leaders to rate Democratic gubernatorial candidate Mike Hatch and those vying for the U.S. Senate seat being vacated by Mark Dayton—Republican Mark Kennedy and Democrat Amy Klobuchar. Hatch, an opponent of corporate tax breaks who was then running step for step with incumbent Pawlenty, received an “excellent” or “good” rating from a combined 20 percent of respondents, and a “poor” rating from 40 percent—not surprising, given that the largest share of survey participants, 45 percent, identified themselves as Republicans. More surprising was the ho-hum response to Kennedy, who was rated “excellent” by 10 percent, “good” by 37 percent, “fair” by 28 percent, and “poor” by 21 percent. Klobuchar received an “excellent” or “good” rating from a combined 31 percent of respondents, and a “fair” or “poor” rating from 64 percent.

Unhealthy Situation

Survey participants were asked to rate nine issues based on “their effect on your organization.” The scale ranged from 0 (not important) to 5 (very important). To be sure, all these issues are important to respondents, with most rating each one a 4 or 5. But health care costs far outpaced the others—70 percent gave health care expense a rating of 5, and 23 percent pegged it at 4. Only 3 participants gave heath care costs a rating of 0, 1, or 2. With those costs cutting into bottom lines, expect this to remain a top concern for quite a while.

Ranked next in importance is the availability of skilled workers, which received a 4 or 5 rating from 79 percent of respondents. Third: business taxes in Minnesota, which 67 percent of participants identified as a 4 or 5.