Walz picks ex-SBA executive as new DEED commissioner

Almost three months after the head of Minnesota’s job creation agency left for a new role, his replacement has been announced.

Thursday, Gov. Tim Walz announced that Matt Varilek will serve as the next commissioner of Minnesota’s Department of Employment and Economic Development.

Varilek will replace Steve Grove, who left the department on March 2 to become the publisher and CEO of the Star Tribune. Since he left, longtime DEED deputy commissioner Kevin McKinnon has been leading the agency in a temporary capacity.

Varilek is currently the president of the Initiative Foundation, which works to help businesses and organizations in Greater Minnesota through grants and financing investments. Before that, he was the chief operating officer for the U.S. Small Business Administration (SBA) and a regional administrator for the SBA. He also ran for Congress in 2012 in a race against current South Dakota Gov. Kristi Noem to represent South Dakota’s at-large district, which he lost.

“From strengthening the economy and communities of Greater Minnesota to advocating for small businesses on the federal level, Matt Varilek brings a wealth of knowledge and experience to his new role driving our state’s economy forward,” Walz said. “I look forward to working with him to grow Minnesota’s strong, vibrant, and diverse economy and support our workers and businesses.”

“Having grown up in a lower-income household, I’m passionate about helping more people enjoy greater economic prosperity,” Varilek said in a statement. “I’m deeply grateful to Governor Walz and Lieutenant Governor Flanagan for the opportunity to join the talented team at DEED at this pivotal moment. The department has just been entrusted with an unprecedented set of tools and resources, and I’m eager to help put them to work for the benefit of businesses, workers, and families across Minnesota.”

His first day leading DEED will be June 20, the governor’s office says.

He’ll take over at a time the state is dealing with labor shortages, something many other states are also dealing with. The state’s unemployment rate has remained steady and below the national rate but job creation and labor force growth have proved difficult amid the tight labor market.

Recent research from the agency showed that increasing international immigration levels could help ease the labor shortage, which was exacerbated by the COVID-19 pandemic.