MANKATO — By Tim Krohn

tkrohn@mankatofreepress.com

MANKATO — Each year in Mankato, shoppers spend $1 billion on iPhones, plywood, dresses, futons, food and other goods.

The powerful retail sector touches all parts of the area economy: Local sales taxes fund civic centers, parks and libraries; thousands of college students and residents find part-time and full-time work; local colleges train students for retail careers; and the $30 million in state sales and use taxes generated annually in Mankato fund roads and schools.

“It’s a huge impact for the community,” says Paul Wilke, manager of River Hills Mall.

Not just minimum wage

While many retail jobs are lower paying, part-time gigs, it’s not the whole story.

Gama Adame, Target store manager in Mankato, said the part-time work for college students and others provides flexible schedules and fair pay. And for those who want to make a career in retail, opportunities with good paychecks abound.

“For Target, we’re a company that continues to grow and we have a lot of opportunity. We have buildings opening and need people to run those buildings. We need people to help run a multi-million business,” says Adame. 

Roberta Moorhouse, a marketing education instructor at South Central College in North Mankato, said her department has prepared a lot of entrepreneurs and store managers.

“There is quite a bit of opportunity. You’d be surprised at the salaries the store managers make in the area.”

According to salary.com, which surveys HR directors throughout the country, the median salary for a retail store manager in Mankato is nearly $48,000, while an assistant manager is at just more than $35,000.

The SCC program, which has been around for more than four decades, educates many students who return to area communities to help run a family business, Moorhouse says. 

Others become entrepreneurs or go to work for companies, while some go on to get a four-year college degree.

“The program is heavy into sales, principles of marketing, customer service, management courses,” Moorhouse says. “It’s a very well rounded program.”

While internships often bring full-time job offers after college, Adame took a different route at Minnesota-based Target.

After getting a communications major in Chicago, Adame started a business that filmed commercials that ran in movie theaters. During his travels he came in contact with a Target executive.

“I never thought at the time that retail would be an area of interest for me. But I fell in love with the whole culture of Target and the opportunities they have.,” Adame says.

After five years of management training at stores in Winona and La Crosse, Adame, 33, got to manage his own store. He said education background is less important than leadership qualities.

“We’re very careful on people that we peg. We want certain qualities. I can teach you how to work logistics or sales floors, but I can’t teach your how to motivate 100 plus team members. We’re looking for leadership,” Adame says.

Matthew Carlson, a career exploration coordinator at Minnesota State University, says state and national projections show that retail will be a strong sector as the economy grows out of recession.

“The general trend is upward, but that’s compared to 2009, which was the bottom,” Carlson says. While recent graduates don’t have the number of job offers of a few years ago, retail job growth has increased nearly 22 percent over last year. (nationally)

Wilke says the wide variety of retail jobs is an important part of the economy.

“The temp and part-time jobs and the full-time permanent jobs are a good mix for the community.

“The management jobs are very good jobs in many cases. There are a lot of  opportunities with the retailers and in the corporate offices.”

Wilke says many retail chains with stores in River Hills have regional managers posted in Mankato.

While retail took a hit in the recession, the center of Mankato’s retail trade — River Hills Mall — has held up pretty well, says Wilke.

The mall’s traffic — 8.5 million visitors a year — has held steady and occupancy in the mall remains strong at 94 percent. There are about 2,000 employees working in the mall, with the number rising during holidays.

Steady funding

The massive retail spending in greater Mankato has created an important and steady flow of revenue for Mankato and North Mankato.

Mankato collects a half-percent local sales tax, a $20 per vehicle sales tax, a half-percent food and beverage tax and a 3 percent lodging tax.

Total collections last year were nearly $4.2 million, according to Dan Scott, Mankato’s finance director.

He says the consistency of the local sales tax collections help the city and residents in several ways.

“One aspect that gets overlooked is when you have bond rating agencies such as Moody’s or Standard & Poor’s come in, they are very impressed with a diversified revenue base. The stronger your bond rating, the less interest you’re paying on debt. That bodes well for the community and keeps property taxes lower,” Scott says.

Local tax collections rose from 2007 to 2008, then fell $6,800 in 2009. Sales tax collections for the first four months of this year are down 2.8 percent from the same period in 2009. 

The local sales tax is scheduled to end in 2022 when the civic center debt is paid off.

North Mankato got state approval for a half-percent local sales tax that kicked in in late 2008.

“The sales tax has been a terrific boon for the city, particularly in trying economic times. It lets the city do some good things,” says North Mankato City Administrator Wendell Sande.

City Finance Director Steve Mork said the tax helps pay for debt on the Taylor Library expansion, for regional park development, for some street work (particularly the planned interchange on Highway 14 and County 41) and for downtown redevelopment.

The tax collection totaled $378,000 in 2009. Collections are up some so far this year, likely due to a new Walgreens, Kwik Trip and some other businesses opening.

The tax is scheduled to end in 15 years.