St. Paul, MN – Minnesota business services firms expect improved profits, productivity and job growth over the next 12 months, according to a survey conducted by the Minnesota Department of Employment and Economic Development (DEED) and the Federal Reserve Bank of Minneapolis.

More than half of respondents expect sales revenue, profits, productivity and employment to increase or stay the same in Minnesota over the next year, according to the survey. Two-thirds of firms expect labor availability to stay about the same, while nearly 65% anticipate raising wages by at least 3% to attract workers during Minnesota's labor shortage.

On inflation, 56% of respondents expect it to rise over the next year, but that figure is down from 65% in last year's survey, reflecting cautious optimism about slowing price increases.

"Businesses are optimistic about Minnesota's economic outlook. Our employers have added jobs eight of the last 12 months and dozens of businesses have announced expansions in our state, including major companies like Meta, Polar Semiconductor and Solugen," said DEED Commissioner Matt Varilek. "We're working hard to address businesses' concerns about our economy, especially the labor shortage, as we aim to keep Minnesota among the top states for business."

CNBC recently ranked Minnesota the 6th best state for business in the country.

"This survey partnership with DEED provides us with on-the-ground intelligence about the business conditions and expectations for inflation and hiring that is key to our understanding of the national economy," said Joe Mahon, Regional Outreach Director for the Federal Reserve Bank of Minneapolis.

The Business Services Industry Conditions Survey gauges the sentiments of Minnesota business services firms concerning their own operations, as well as the state economy as a whole. Accounting firms, computer consultants, advertising and public relations agencies and other types of service companies support the activities of other businesses, and their performance is an indicator of overall business conditions and trends across industries and throughout the state. This year's survey included responses from 141 businesses.

DEED and the Federal Reserve Bank of Minneapolis have conducted this survey annually since 2006. A detailed report of the 2024 Survey of Minnesota Business Services Firms is available on the DEED website.