Thursday, April 24, 2014
Those interested in economic development are plagued by lists and rankings – highest taxes, best quality of life, worst business climate, foodie heaven, best place to retire, on and on.
Based ultimately on the strength of envy, these lists reinforce the tendency to chase the latest policy fad – what can we do to be more like New Hampshire or Texas or Utah or Aspen or the Research Triangle or Silicon Valley? Such lurching around from new approach to new approach diverts attention from a more searching effort to identify who we are now and who we would like to become. It also raises the general level of cynicism about the economic development programs.
It is interesting, therefore, to look at the nature of our jobs – not in terms of the products and services we make, but in terms of the occupations we pursue. What do we do now? And what might we like to do more of in the future?
As an example, how many of us make and move stuff? Farming, fishing, forestry, construction, installation, maintenance and repair, production and transportation occupations constitute 21 percent of the workforce in Maine. This is virtually identical to the share for the U.S. as a whole. Narrowing the focus to the Greater Portland area, the share is just more than 18 percent of the workforce. In the Greater Boston area, the share is just less than 15 percent of the workforce.
How many of us, in comparison, manage operations and sell stuff? In Maine as a whole, management, business and financial operations and sales occupations account for just more than 19 percent of the workforce. This compares to just more than 20 percent for the U.S., just more than 22 percent for metro Portland and nearly 24 percent for metro Boston.
The biggest differential occurs in the category of business and financial operations occupations, where Maine lags the national average and metro Portland barely exceeds the national average and trails metro Boston by a significant margin.
This supports the hypothesis that Maine lacks the number of large enterprises capable of providing a large number of skilled financial and managerial jobs. This implies that growing businesses to a larger scale may be the development direction called for by looking at the most appropriate model.
Consider finally computer, math, science and engineering occupations. They account for 3.8 percent of the workforce in Maine as a whole – just more than 22,000 jobs. For the U.S. as a whole, these occupations account for 5.4 percent of the workforce. In metro Portland – allegedly Maine’s science and tech hub – such occupations account for only 4.7 percent of the workforce, barely more than 9,000 jobs. In metro Boston, in contrast, these occupations account for 9.4 percent of the workforce, more than 230,000 jobs.
To me the conclusion is clear. Rather than worrying about what tax or regulatory policy change will “unleash” some latent motivation to build or bring big new businesses, we must find ways to encourage those already here to grow by finding ways to train and attract people with the technical and managerial skills needed to bring Maine businesses to national scale.
Our target should be not the tax structure or climate of other states, but the business development goal of national scale. We need to embrace big.
Small, quaint and quirky is fine for those who can make a living on those goals, but transformation of Maine’s economy requires fuller engagement with a far larger world.
Charles Lawton is chief economist for Planning Decisions, Inc. He can be reached at: