Ordinarily, we would celebrate Maine’s unprecedented 3 percent unemployment rate as a sign of a robust economy. In fact, Maine’s southern and midcoast economies are thriving by many measures.

But a crisis is looming as Maine’s workforce shrinks because of baby boomers’ retirements, combined with a steadily declining birth rate. Maine’s Department of Labor projects that 88 percent of annual job openings are the result of retiring workers. Job vacancies range from the highest-skilled professionals to entry-level and unskilled positions. Chronic labor shortages can cause employers to leave Maine, cutting economic growth off at the knees.

There is no simple remedy for Maine’s aging workforce or the mismatch between employers’ needs and many job seekers’ skills and geographic locations. From remedial education and job-specific training, to employment counseling, to improved public transit or relocation assistance, Maine needs more public investment to support our underemployed working people.

Maine’s influx of immigrants can also contribute to our state’s economic prosperity and community vitality. This essay sketches how mobilizing “New Mainers” talents will enable us to “do well by doing good.”

Maine’s immigrants are a welcome addition to our labor supply. Maine’s recent immigrants are highly educated, with 34 percent of those aged 25 or older having a bachelor’s degree or post-graduate education, compared to 29 percent of Mainers. They are also in their prime earning years, with those arriving since 2010 having a median age of 28, compared to Maine’s median age of 44.

Many immigrants become business owners and operators. About 10 percent of Maine’s immigrants have started their own businesses, far exceeding their 3.7 percent share of Maine’s population. Most hire from the local labor pool, and buy supplies from, pay taxes to and provide goods and services to their local communities.

New Mainers also contribute to local economies and job creation through consumer spending and neighborhood revitalization. The more fully New Mainers can utilize their skills and entrepreneurial talents, the larger these contributions.

All told, former Congressional Budget Office Director Douglas Holtz-Eakin – a Republican – estimates that immigrants will boost U.S. gross domestic product by 3 percent to 3.9 percent, looking out 10 years.

Nonetheless, critics warn of two supposedly negative effects of immigration: taking jobs from local workers and increasing tax burdens.

Empirical studies yield varying estimates of “job displacement.” A typical finding is that in “normal” labor market conditions, the earnings of low-skilled native-born workers are depressed by 1 to 2 percent. But the threat of job displacement in Maine’s current labor market, with over-full employment and labor shortages at every skill level, is minimal. Indeed, according to the American Enterprise Institute, expanding the supply of highly educated immigrants fills skill gaps, enabling businesses to grow faster and create still more quality jobs.

Research indicates that while in the very short run, state and local governments may spend more on immigrants than they receive in additional taxes, within a few years, the fiscal impact turns positive. Both the rapidity and the size of the budgetary turnaround hinge on the effectiveness of programs to speed immigrants’ transition into jobs making full use of their skills.

Underemployment affects roughly a quarter of college-educated immigrants nationally, with an estimated annual economic “opportunity cost” of $26,000 a person in lost productivity and earnings. The policy challenge is to shape programs that will minimize that waste.

The Maine Legislature is considering L.D. 1492, sponsored by state Sen. Roger Katz, R-Augusta. It will create a web of community-focused work-readiness initiatives, building on successful cost-effective experiences here and elsewhere, to prepare New Americans for skilled employment and entrepreneurship.

Strengthening English proficiency is a clear priority. L.D. 1492 would expand traditional adult English-language education, as well as job-specific English instruction integrated into vocational training, and coordinated with prospective employers. An inspiring example is the work of the New Mainers Resource Center, which would be expanded under L.D. 1492, with Southern Maine Community College, to help immigrants with prior medical backgrounds master English technical terminology in a hands-on setting, to fill critical EMT shortages.

New Mainers deserve our support from an American values and humanitarian perspective. But they are also underutilized community assets who, with smart public and business investments, can contribute much more to our shared prosperity.

Copy the Story Link