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Maine Development Foundation

Media

What’s up and what’s down in Maine

Bangor Daily News - Darren Fishell

Date:

April 16th, 2015

PORTLAND, Maine — It’s a grab bag of data.

The Maine Economic Growth Council and Maine Development Foundation’s 30-page Measures of Growth report, for that reason, is hard to put under just one headline.

There are many interesting metrics and measures in the report, not just about the economy but the environment and overall health as well. The growth council was formed by state law in 1993 to set long-term goals for Maine’s economic growth.

With that aim in mind, each metric in the group’s report is measured against different standards: in some cases it’s a national or regional measure and in others it’s how the state did on the same measure in previous years. And 2015 report doesn’t review only indicators for 2014.

The report — the 21st — draws most attention to where Maine improved and where it fell behind, but there are interesting trends throughout.

Let’s start with the good.

Where Maine improved

Cost of doing business in Maine (white, dotted line) was down in 2012 (pg 20)
 
It costs more in New England to run a business than the average for the rest of the country, but Moody’s Analytics’ index for comparing business costs by state showed northern New England states with dropping costs, with Maine the second-closest in New England to the national average in 2012.

In Maine, it was the lowest index rank since 1991, though the state still came in at the 11th highest nationally for the cost of doing business in 2012.

The metric is a combination of labor costs (Maine’s middle of the pack nationally), taxes (fifth highest) and energy costs (11th highest), which contributed to much of the drop.

Energy costs were down but remained higher than national averages (pg 22)
 
Industrial energy costs in Maine were down more sharply than retail electricity prices, but both fell closer in line with national averages, which remained largely unchanged from 2006 to 2012. The study notes Maine manufacturers also compete with companies in the neighboring Canadian provinces “ that benefit from dramatically lower electricity costs.”

Less specific to businesses, the report found Maine’s median income levels have continued to come more closely in line with median home prices and rents. The index used is a combination of two separate measures — median home prices and median rents — tracked by MaineHousing.

Housing has become more affordable, according to the MaineHousing indices that compare median wages to median home prices and rents (pg 28)
 
The state also fared well on environmental measures, with the number of bad air quality days continuing to decline and water quality in Maine’s major waterways earning high marks.

Bad air quality days have fallen consistently since 1985 (pg 37)
 
The study notes “ the environment indicators speak to one of Maine’s key assets and the benefits and opportunities it presents.” Water quality remained about even with past years but was highlighted for continuing to be far above the U.S. average for water quality in lakes and ponds and rivers and streams.

Where Maine lost ground

Maine exports are up, but behind the pace of U.S. exports (pg 13)
 
Exports (minus semiconductors because of some non-economic changes in the data) were up. But not as much as the Maine Council for Economic Growth wanted. That is, they sought for the rate of export growth to outpace national growth.

The report highlighted particular strength in lobster exports, which it noted was for the first time the state’s largest single exported commodity.

Maine's workforce declined in 2014 from the previous year (pg 19)
 
The report shows Maine lost ground toward a goal of boosting its workforce by about 70,000 people by 2020. The report does not include a breakdown of reasons for that decline, whether retirement or discouraged job seekers stopping their search.

At the individual level, the report found the earnings difference between men and women delivered a discouraging word.

The average income gap widened between Maine men and women in 2013 (pg 29)
 
Women made about 81 cents on every dollar earned by a man in Maine, which is higher than the national average but also a wider earning gap than in the previous year. And the report attributed some of the narrowing earnings gap to men’s wages stagnating.

Index of business starts by people 24-60 was down, but comparable to other regions (pg 15)
 
The report also viewed negatively a decline in an index tracking business starts by people between the ages of 24 and 60. The rate declined in line with similar states, New England and the United States at large, while Maine’s national rank for the number of business starts in 2013 rose from 29th in 2010 to 19th in 2013.

Road quality fell short of goals (pg 24)
 
Road quality ratings improved slightly in 2013, but were far below a goal that 76 percent of the state’s major roadways would receive high quality marks. The report set a goal that 95 percent of Maine’s priority one and two roads would meet a rating of fair or better by 2020.

The report also showed Maine fell behind on one health metric: obesity.

Percentage of overweight adults has trended up in line with national figures (pg 30)
 
It cites the percentage of overweight and obese adults as a health problem but also a possible economic challenge, resulting in higher health care costs and potentially lower productivity.

The space between

Within the ups and downs, however, there are hints of both good and bad, even in metrics that did not change much in relation to state goals.

Poverty rates increased, but remained below the national average (pg 7)
 
A three-year average of Maine’s poverty rate rose by nearly 2 percentage points in 2013, compared with the same measure in 2008. In 2013, it remained below the national rate, which was set as the goal for that measure through 2020.

Food insecurity remained higher than national and regional averages (pg 32)
 
Food insecurity was a similar metric in the report, which didn’t move in relation to previously set goals, but also got worse in 2013, in line with the rest of the country and New England, since 2008. That means about 200,000 Mainers — 15 percent of the population — did not have consistent access to affordable nutritious food in 2013, by a U.S. Department of Agriculture estimate.

Within those metrics that got either no grade or didn’t show significant movement one way or another, the report flagged a few particular statistics as concerns.

R&D funding was behind all comparison regions in 2011 (pg 12)
 
While suffering from a lack of more recent data, the latest figures from 2011 showed off the pace of similar states and national and regional averages for research and development funding. More recent statistics from the National Science Foundation tracking the second-largest segment of R&D funding in Maine — universities — showed spending was down in fiscal year 2013 from the previous year.

Maine drops behind comparison regions for high speed Internet adoption (pg 14)
 
The percentage of high speed Internet subscribers per 1,000 residents continued to climb in 2013, but didn’t gain any ground toward the goal of closing the gap with the New England average. In 2013, Maine dropped behind similar mostly large and rural states (the Experimental Program to Stimulate Competitive Research, or EPSCOR) average for high speed Internet adoption.

The report suggests policy changes or public investment will be needed to improve the rate of high speed Internet adoption in Maine, an issue that’s emerged with bipartisan interest in the Legislature this session.


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