Editorial Staff

Pioneer Report Underscores Wide Disparities in Economic Performance between Industry Sectors in Massachusetts

/in , , /by Editorial Staff
Share on Facebook
Share on Twitter
Share on
LinkedIn
+

BOSTON – Service-based industries have significantly outperformed manufacturing and other traditional blue-collar economic sectors in Massachusetts since 2008, according to a new report from Pioneer Institute that draws on data from the MassEconomix web tool.

In “Broad Industry Sector Trends in Massachusetts, 1998-2018,” two decades of data show fluctuating employment changes across the state, as well as changes in firm size and the types of firms disproportionately headquartered in the Commonwealth.

Health Care tops the list of those industries that have added the most jobs in Massachusetts from 2008-2018, with “Other Services” (everything from funeral home directors to valet parking attendants) and Accommodation & Food also comfortably outpacing population growth. It’s unclear how COVID-19 will affect these trends in the long-term.

The report is the second in a series that presents employment and business establishment trends in the Commonwealth on both the state and municipal levels.

“While Health Care easily leads in job gains, Educational Services remains the most heavily concentrated industry in Massachusetts relative to the national average,” said Andrew Mikula, who co-authored the report with Rebekah Paxton. “The Education sector also has plenty of very large individual employers, notably Boston University.”

Despite nearly a decade of economic growth through 2018, several industries were still shedding jobs in Massachusetts. Manufacturing, Wholesale Trade, and Public Administration top the list of most jobs lost by sector.

Agriculture and Mining & Extraction have enjoyed some of the strongest rates of employment growth in the state since the Great Recession. Still, industry sectors that work to extract raw materials in Massachusetts constitute a minuscule fraction of the state’s overall workforce.

All of the reports in Pioneer’s MassEconomix series use the same Your-economy Time Series data to develop aggregated numbers for statewide growth. This data is recorded by Infogroup and compiled by the Business Dynamics Research Consortium (BDRC) at the University of Wisconsin System Institute for Business and Entrepreneurship in Madison, Wisconsin.

Following this report, Pioneer will use these data to release regular publications that document trends in individual cities and towns, and create “snapshots” of particular industries.

About the Authors

Andrew Mikula is a Research Assistant. Mr. Mikula was pre­viously a Lovett & Ruth Peters Economic Opportunity Fellow at Pioneer Institute and studied economics at Bates College.

Rebekah Paxton is a Research Analyst at Pioneer Institute. She earned an M.A. in Political Science and a B.A. in Political Science and Eco­nomics, from Boston University, where she graduated summa cum laude.

About Pioneer

Mission

Pioneer Institute develops and communicates dynamic ideas that advance prosperity and a vibrant civic life in Massa­chusetts and beyond.

Vision

Success for Pioneer is when the citizens of our state and nation prosper and our society thrives because we enjoy world-class options in education, healthcare, transportation, and economic opportunity, and when our government is limited, accountable and transparent.

Values

Pioneer believes that America is at its best when our citi­zenry is well-educated, committed to liberty, personal respon­sibility, and free enterprise, and both willing and able to test their beliefs based on facts and the free exchange of ideas.

Get Updates on Our Economic Opportunity Research

Related Posts

Pioneer Statement on Continuing Slide in Massachusetts’ Revenue

The Commonwealth’s tax collections continue to slide, totaling $3.594 billion in January, $268 million below what the state collected in January 2023, and short of the revised benchmark by $263 million. Massachusetts state government must live within its means by reducing FY2025 spending. The days of fiscal surpluses, unprecedented increases in year-over-year spending, and flowing federal aid have come to an end.

Pioneer Statement on Decline in State Revenues

The Commonwealth’s finances have stumbled hard in recent months, and based on a report the Department of Revenue (DOR) sent to the Legislature in January, the trend shows no signs of easing. Massachusetts needs a renewed emphasis on fiscal discipline and pro-growth policies to make the state economically competitive again.

Skill-based immigration could ease labor shortage

A recent Biden administration executive order that amends the Schedule A list, which identifies occupations experiencing labor shortages and allows immigrants in those occupations to expedite their employment in the U.S., could positively impact the hiring of skilled international workers for years to come — a welcome development as the country and Massachusetts struggle to attract talent amidst a worsening labor shortage.

My Musings on Massachusetts’ Fiscal Picture

Since the start of FY2024 on July 1, 2023, the state has experienced six straight months of revenues falling short of expectations. The single biggest factor is the unprecedented growth of the state budget since FY2021. The $15 billion increase in state spending contextualizes the seemingly modest projected revenue growth of 1.6 percent for FY2024 by highlighting that the base is very inflated.

The Massachusetts Workforce: Abundant Resources, Steep Challenges

Massachusetts features a strong workforce training system with abundant resources yet faces challenges in matching jobs and applicants, training youth, and attracting sufficient numbers of skilled immigrants, according to a pair of studies from Pioneer Institute.

Pioneer Institute Statement on the State Legislature’s FY2024 Tax Relief Package

The recent advancement of a tax bill H. 4104, that is expected to be enacted by the Legislature this week after languishing for more than 20 months, puts Massachusetts taxpayers one step closer to realizing some tax relief. However, it may be too little to tackle the Commonwealth’s affordability and competitiveness challenges.

Poll: MA Voters Oppose Legislative Proposals to Change Tax Rebate Law

A strong majority of registered Massachusetts voters oppose a plan recently announced by state legislative leaders that would change the way tax rebates are distributed in Massachusetts under a state law approved by voters in 1986, according to a new poll sponsored by Pioneer Institute and the Massachusetts High Technology Council.

A Tale of Two Massachusetts: Wealth and Labor Differences Between East and West

This blog compares the income, wealth, and property values of western Massachusetts to those of eastern Massachusetts, highlighting the west's potential for growth.

Senate Tax Package Misses the Mark on Competitiveness

The Senate tax package, S.2397, is heavy on provisions that reduce the tax burden for certain taxpayers, thereby helping those that qualify for the expanded credits and deductions. The bill, however, is light on provisions that will improve the Commonwealth’s competitiveness.

Study: Immigrant Entrepreneurs Benefit N.E. Economy, Despite Facing Obstacles to Growth

BOSTON – Immigrants in Massachusetts and New England are more likely to be self-employed, but the businesses they own tend to be in different industries than those owned by the U.S. born, according to a new study published by Pioneer Institute.
Image by Freepik

A Model for Occupational Licensing Reform in the Bay State

Licensing for many professions squeezes the supply of services, artificially inflating prices and creating wage premiums. One study from the Institute for Justice put the wage premium relative to an environment without any occupational licensing at a whopping 22 percent in Massachusetts.

Study Finds Massachusetts Workforce Has Become More Female, Older, More Diverse

The Massachusetts labor force has transformed in recent decades, with some of the biggest changes being the advancement of women, workers getting older and more diverse, and a divergence in labor force participation rates based on levels of educational achievement, according to “At a Glance: The Massachusetts Labor Force,” a white paper written by Pioneer's Economic Research Associate Aidan Enright.

New IRS Data Shows Out-Migration Worsening, Underscoring the Need for Massachusetts Leaders to Focus on State’s Competitiveness

Massachusetts’ net loss of adjusted gross income (AGI) to other states grew from $2.5 billion in 2020 to $4.3 billion in 2021, according to recently released IRS data. Over 67 percent of the loss was to Florida and New Hampshire, both states with no income tax.

Public Statement on the House’s Proposed Tax Reform and Budget

Pioneer Institute applauds key tax reform provisions advanced by the Speaker and House leadership, including a reduced short-term capital gains tax rate and implementation of a single sales factor apportionment. But leadership must do more to bolster the state’s economic competitiveness and slow out-migration of wealth and business owners that endangers the commonwealth’s economic future.

Debunking Tax Migration Myths

Provisions of Gov. Healey’s $876 million tax package targeted to higher-income earners — including revisions to the estate tax and a reduction in the tax rate for short-term capital gains — are important for encouraging taxpayers subject to them to remain in Massachusetts, according to a new analysis from Pioneer Institute.
Image by Freepik.comImage by Freepik.com

A History of Rent Control Policy in Massachusetts

While many may only remember the 1994 referendum and the laws…