Executive Summary
Recent enforcement-related disruptions and labor uncertainty have frozen consumption, strained payroll flows, and increased business failure risk. This brief proposes a targeted stabilization and competitiveness package designed to protect Minnesota’s tax base, workforce pipeline, and long-term economic growth. Immigrant workers support around a third of Minnesota’s GDP. (Data by immigrant group at end of report).
Immediate 90-Day Economic Stabilization Package
- Working Capital Stabilization Fund
- Workforce Stabilization Fund
- Neighborhood Rebuilding Tax Credit Fund
- Temporary Sales Tax Freeze in Immigrant Corridors
- Fast Track Immigration Reform
- Fiscal Safeguards and Accountability
First – The Critical Role of the Immigrant Economy For Minnesota’s Economic Survival
More than 1 out of every 10 workers in Minnesota are from immigrant communities.
Source:https://mn.gov/deed/newscenter/publications/trends/mar-2025/foreign-born.jsp
More than 1 in every 10 business in Minnesota are immigrant businesses
Source: Annual Survey of Business, 2023
Immigrant income is $26.4 billion or around 10 percent of total income in Minnesota
Source: American Community Survey, 2024
Immigrants own homes worth $42 billion and immigrant renters pay property owners more than $137 million in rent every month (American Community Survey, 2024)
Immigrant workers support $164 billion in economic output—and 750 thousand jobs and 18 billion in federal, state and local taxes. Immigrant workers support around a third of Minnesota’s GDP. (IMPLAN Economic model of the ALANA Brain Trust)
Strategy
Immediate 90-Day Economic Stabilization Package
- Working Capital Stabilization Fund
- Workforce Stabilization Fund
- Neighborhood Rebuilding Tax Credit Fund
- Temporary Sales Tax Freeze in Immigrant Corridors
- Immigration Reform
- Fiscal Safeguards and Accountability
1. Working Capital Stabilization Fund
Proposed Allocation:
- $50-90 million will reach 30 to 50 percent of immigrant owned employer firms with up to $25,000 in assistance grants.
- $60-$100 million will reach 30 to 50 percent of all immigrant nonemployer firms with up to $2500 in assistance grants.
Supporting Data
- According to the Annual Business Survey 2023, in Minnesota, there are 78,500 immigrant non employer businesses or 16 percent of all non-employer businesses
- 49 percent of all nonemployer businesses in Transportation
- 18 percent of nonemployer businesses in Accommodation and food services
- 10 percent or higher in another 10 sectors from Finance to health care.
- According to the Annual Survey of Business, 2023, there are 7212 employer immigrant businesses or 8 percent of all employer businesses in Minnesota.
- 19 percent of all employer businesses in health care and social services and accommodation and food services are immigrant owned.
- More than 8 percent of employer firms in retail, transportation, information and professional services are immigrant owned.
Purpose: Prevent permanent small business closures.
- Administered through certified CDFIs with staged disbursement tied to payroll and rent verification.
- Public transparency dashboard and clawback provisions.
Impact: Protect jobs, stabilize corridors, preserve sales and income tax revenue.
2. Workforce Stabilization Fund
Proposed Allocation: $110 million
Purpose: Maintain household liquidity and workforce attachment.
- Would offer $1000 in emergency stipends for 30 percent of the immigrant workforce
- Housing stabilization component (rent/mortgage buffer).
- Delivered through trusted intermediaries with simple documentation standards.
- Median gross rent paid by immigrants – $1354 (American Community Survey, 2024)
Impact: Prevent wage shock cascading into housing and retail collapse.
Supporting Data: Critical role of 370,000 + immigrant workers on the Minnesotan economy and in key sectors as documented by DEED – : https://mn.gov/deed/newscenter/publications/trends/mar-2025/foreign-born.jsp
3. Neighborhood Rebuilding Fund (Tax Credit Model)
Structure: Refundable 50%–100% state tax credit (capped per donor of $500).
- Funds deployed locally via community boards hosted within CDFIs.
- Donors designate categories (restaurants, retail, workforce support).
Impact: Mobilizes private capital; multiplies state investment; strengthens cross-community solidarity.
Supporting Data: Widespread effort in Minnesota by neighbors supporting neighbors in various ways. This provides a tool for neighbors to build their community.
4. Temporary Demand Stimulus
15-Day Sales Tax Holiday for Restaurants
Purpose: Immediate foot traffic restoration.
Mechanism: Automatic POS-level exemption statewide or targeted corridors.
Impact: Boosts revenue, restores worker hours and tip income.
II. Fiscal Safeguards & Accountability
To address concerns regarding fraud and fiscal exposure:
- Third-party administration via CDFIs.
- Real-time public reporting dashboard.
- Inspector General audit triggers.
- Staged disbursement tied to verified payroll and lease obligations.
- Sunset clauses (90-day initial authorization with review).
Framing: This package preserves the tax base and prevents long-term fiscal erosion.
III. Immigration Competitiveness & Talent Strategy
Minnesota’s labor force growth increasingly depends on immigration. To ensure long-term resilience:
1. Guest Worker Coordination Compact
- State-federal task force to streamline H-2A/H-2B processes.
- Employer assistance hub to reduce administrative burden.
2. Global Talent Retention Initiative
- Retain international students graduating from Minnesota institutions. Internship-to-employment matching in healthcare, STEM, manufacturing, and construction.
- Design a skill-driven, dynamic visa marketplace rather than static caps: employers post skill needs and pay scales; foreign talent bids using verified credentials; visas are issued in real-time based on labor market scarcity and wage levels. This reduces arbitrary quotas, accelerates mobility, and aligns immigration with economic demand. Incentives could include tech-investment credits for skills in underserved regions and sectors.
IV. Economic Rationale
- From IMPLAN model – Protects ~$164 B in annual labor contribution.
- Preserves 750,000+ employer-supported jobs.
- Preserves estimated $18B in Federal State and Local Taxes
- Stabilize commercial real estate and housing payments.
- Prevent multiplier contraction across supply chains.
Speed of deployment is more critical than perfect targeting.
Conclusion
This strategy is not expansionary spending. It is targeted economic stabilization designed to protect Minnesota’s workforce, tax base, and competitive advantage in a tight labor market.
Failure to act risks permanent firm exits, housing instability, workforce detachment, and long-term fiscal decline.
IMPLAN model showing potential economic impact of immigrant workers in Minnesota.
Latino Economy Data (Hispanic/Latino or any race and citizenship status)
- 197,000 workers in critical sectors of the economy such as agriculture, accommodation and food service, construction, manufacturing..
- Latino support 52 billion in economic output for the Minnesotan economy or around 10 percent of the state GDP.
- 11 billion in income
- $17 billion in residential real estate
- $63 million monthly in rental payments
- 14000 nonemployer business with $619 million in sales
- 2950 employer businesses with $3.4 billion in sales employing 28, 289 people with $1.5 billion in payroll
African Immigrant Data (Born in Africa)
93,833 workers
$5.7 billion in income
$7.1 billion in residential real estate
$55 million monthly rental payment
2924 employer firsm with $3.3 B in sales, employing 54,423 with $1.56 B payroll
37000 nonemployer firms with $1.4 B in sales
Asian Data (alone or in combination and citizenship status)
197,795 workers
$16B in income
$26 B in residential real estate
$56 million monthly rental payments
5210 employer firms with $7.7B sales, 46265 employees, $1.8B payroll
17000 nonemployer firms with $643 million in sales
Native American Data (alone or in combination and citizenship status)
66480 workers
$4.3 B income
$6.3 B value of residential real estate
$26 million in monthly rental payments
3500 nonemployer firms with $94 million in sales
No data on employer firms
Data Sources
Firm data from https://mn.gov/deed/data/economic-analysis/race-ethnicity/
Other Data – American Community Survey
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