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Press release/statement

RELEASE: Report Shows Minnesota's Middle Class Lagging In Key Indicators as Budget Debate Turns to Shut Down

For Immediate Release
June 15, 2011 

Contact & RSVP: 
Anna Pycior, [email protected], (212) 389-1408
Alex Amend, [email protected], (917) 822-7405
Lauren Strayer, [email protected], (734) 904-1704

Growth & Justice and Demos Show How Minnesotans Face Falling Earnings, Lack of Good Jobs, and Decreasing Access to College 

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Minneapolis – Today, as the Minnesota budget stalemate continues and the potential for a state government shutdown grows, a new report from the Minnesota think tank Growth & Justice and the national policy center Demos highlights how austerity budget proposals would further undermine the state’s economy and struggling middle class.    

According to "The State of Minnesota's Middle Class,” working Minnesotans are currently facing real challenges including a lack of good jobs, declining access to benefits, higher costs to raise children, and decreasing access to post-secondary credentials.  Just last week, it was announced that University of Minnesota undergraduates are likely to face another large tuition increase next year, on top of previous double digit percentage increases, as federal stimulus funds dry up and state revenues stall.  The report shows how these trends will deepen, lengthening the effects of the Great Recession, if austerity goals continue to drive Minnesota’s budget debate.

"We estimate that the jobs lost due to the recession have cost the state nearly $300 million dollars in lost tax revenues, putting thousands of middle-class jobs at risk," the report notes. "If the state’s unemployment rate were at pre-recession levels, those lost hundreds of millions would return to the state government’s coffers, and could be used to help young people attend college, maintain dozens of state parks, or create thousands of middle class jobs, such as teachers or nurses."

Quick Facts from "The State of Minnesota's Middle Class":
-- Although unemployment has been less severe in Minnesota than other parts of the country, the unemployment rate is at its highest since the early 1980s.

-- Wages peaked at $39,312 in 2001 and have fallen 9 percent since to $35,700, leaving the typical worker at the same earnings level as 1999.

-- The proportion of Minnesota workers who lack access to health insurance through an employer increased from 14 percent in 2000 to nearly 23 percent in 2010.

--- Earnings for recent graduates peaked in Minnesota in 2002 and have plummeted since, declining 23 percent.

"The unraveling of Minnesota’s social contract predated the Great Recession, but the economic crisis hastened its decline. Not only did the state lose over 110,000 jobs, but the economic effects of those lost jobs reverberated to all corners of the state, particularly the already-strained finances of the state government," said Dane Smith, President of Growth & Justice. "Now is the time for employers, workers, and policymakers to come together once again to rebuild pathways to the middle class, create good jobs with fair pay and decent benefits, and ensure that prosperity is broadly shared for the next generation."

"A full three years after the economic crisis began, the national debate has yet to address the most pressing challenge of our times: getting people back to work and rebuilding the middle class," said Tamara Draut, Vice President of Policy & Programs at Demos. "Public investment in education, infrastructure and good jobs now remains the best route to recovery."

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