ST. PAUL, Minn. (WCCO) — Minnesota’s unemployment rate is the lowest it’s been in decades, but state officials are predicting a weaker-than-expected economy in 2020.

Minnesota’s new governor says it’s not a recession, it’s a slowdown.

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“This is not a downturn of people losing their jobs,” Gov. Tim Walz said. “There aren’t enough people to fill all of the jobs that are available.”

State economists say there’s uncertainty about trade tariffs, fewer workers and geopolitical events.

It’s causing Minnesota’s healthy $1.5 billion budget surplus to drop sharply to a still healthy $1 billion — but it could go lower.

Walz’s plan is to pump billions of dollars into public construction projects, including roads and bridges.

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“One of the best firewalls against a downtown? It’s investments in infrastructure. It has played out time and time and time again,” Walz said.

Republican leaders say Democrats need to hold spending — or cut it — not raise taxes.

“The problem isn’t that we don’t have jobs and don’t have people in the workforce,” said Republican Minority Leader Rep. Kurt Daudt. “The problem is that high-income earners are leaving the state of Minnesota, and that’s really clear in this forecast.”

But Walz is unapologetic. He says decades of Republican “trickle down” policies have never worked.

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“There is one tool in the Republican tool box: Cut taxes, cut taxes, cut taxes,” Walz said.