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Medical Instruments and Supplies Grew in Twin Cities Rapid growth of instruments and related products manufacturing in the state has softened the impact of sharp declines in computer manufacturing. This industry now employs over 37,000 workers, near • the peak of computer manufacturing jobs in the state during the late 1980s, and surpassing the current 25,000 jobs in computer and office equipment manufacturing. However, the instruments group had a slow component, the more mature measuring and controlling device manufacturing sector, that had some businesses linked to declining federal defense contracts. Employment in this group peaked at 16,500 jobs in early 1990 and went down to 14,000 jobs in the summer of 1995. Minnesota In contrast, medical instruments and supplies manufacturing is a fast growing sector in the instruments Statewide and related products group. Employment grew from 12,000 workers in 1990 to 16,800 in the summer of 1 An-alysi 995, mostly in the Twin Cities area. This industry benefits greatly from an outstanding health service sil industry in the state, including research facilities in hospitals and universities. Another component, 3rd Quarter, 1995 ophthalmic goods manufacturing has a large concentration of employment in the St. Cloud area. Survey of Manufacturers — Fourth Quarter 1994 through Third Quarter of 1995 During the third quarter of 1995, 59 failed manufacturers were surveyed. Although financial difficulty was the primary reason cited for business failure, four firms reported moving out of Minnesota, three of which relocated to neighboring states. During the one year period that began with fourth quarter 1994 and ended with third quarter 1995, 259 manufacturers closed their business operations. The most commonly cited cause was financial difficulty. Specifically, 77 responding firms cited financial difficulty as the primary reason for business dissolution, while 10 firms consolidated their businesses with operations in another state. Fourteen firms, employing more than 84 workers, reported moving out of Minnesota during the one year period that ended third quarter 1995. Major reasons cited by the firms for their move were state-induced • business costs, such as Minnesota's income, sales and property taxes, workers' compensation and unemployment insurance costs. The manufacturing fimts that moved out of Minnesota during the past four quarters went to the following states: California (1), Iowa (2), Kansas (1). Kentucky (1), North Dakota (1). South Dakota (1), North Carolina (1), South Carolina (1), Texas (1) and Wisconsin(4). Since the survey began in the third quarter 1991, a total of 1,038 dissolved manufacturers have been surveyed. A total of 76 manufacturers (7 percent) moved out of Minnesota and 36 of these movers (47 percent) relocated to the border states of Iowa, North Dakota, South Dakota and Wisconsin. Cause of Manufacturing Business Dissolution (Fourth Quarter 1994 through Third Quarter of 1995) Other 22 Total number of business dissolutions = 259 $* Moved out of state 14 Moved within state 9 Cause of dissolution Consolidated with operations in another state 10 unknown 104 Consolidated with another MN location 12 Death/retirement of owner 10 ` r Lack of technical assistance&support from stale 1 C }' r 11 ` Financial reasons 77 • * This survey did not include eliscontinued businesses in other industries, such as wholesaling and trucking. tit addition, the sun eN did not in' businesses that have chosen to expand outside of Minnesota or those that were not able to expand in Ahnneso:.; because of hilt state-unposed costs. 3