 |
» View Data
» Resources
The Northeast Region borders New Hampshire to the north and the Atlantic Ocean to the east and extends along the I-495 corridor from Westford to Salisbury. It includes 23 cities and towns, ranging from the old mill cities of Lowell, Lawrence, and Haverhill to towns that have recently witnessed explosive growth, such as Andover, Chelmsford, and Westford.
Mills along the Merrimack River once fueled the nation's Industrial Revolution, as they drove the economy of the Northeast Region into the post–World War II era. Since 1950, however, three trends have dominated the regional economy: the sharp decline of the textile industry; the Cold War buildup and post–Cold War reduction of defense spending; and the meteoric emergence and eventual flameout of the minicomputer industry.
As the state's high-tech manufacturing growth engine, the Northeast Region provided a powerful stimulus for the Commonwealth's spectacular economic growth in the 1990s.
The legacy of its roller-coaster economic history is a rich concentration of innovative national and international high-tech firms, many of them supported by an array of locally owned companies. A host of agencies and organizations concerned with issues such as job training, immigrant business assistance, and affordable housing are key to the region's sustained development. As the state's high-tech manufacturing growth engine, the Northeast Region provided a powerful stimulus for the Commonwealth's spectacular economic growth in the 1990s.
In addition to the region's overall strengths in high-tech manufacturing, several of its cities and towns promote tourism linked to agriculture, the sea, or the nation's industrial heritage. Whale watches, cultural festivals, golf, beaches, coastal and mountain hiking, and professional baseball and hockey contribute to the region's lifeblood.
Passenger rail connections run from Lowell to Boston, linking several cities along the North Shore, and service has recently expanded to include stops in New Hampshire and Maine. The region is proximate to several airports, including Logan International, Hanscom Field, Worcester Regional Airport, and Manchester Airport in New Hampshire. Rapid industrial, commercial, and residential growth along its interstate and state highways, fueled by the late 1990s' surge in high-tech manufacturing and software services, has generated significant automobile congestion and placed great stress on the local infrastructure.
Employment Trends
The Northeast Region responded well to the opportunities of the 1990s and performed significantly better than the Commonwealth as a whole. Spurred by vigorous growth in software, telecommunications, and related business services, covered employment grew 24.6 percent from 1993 to 2000 (versus 20.2 percent in the state). The workforce expanded 7.5 percent (versus 0.3 percent statewide) and the population 8.6 percent (versus 5.5 percent) between 1990 and 2000. Job creation exceeded workforce gains, especially from 1993 to 1996. Until the downturn at the end of 2000, firms struggled to find engineers and other highly skilled workers to support this growth.
After reaching a peak of close to 10 percent in 1991, the unemployment rate in the Northeast Region dropped to near 2 percent in 2000. It has since risen steadily, to 3.9 percent in 2001 and again to 6.5 percent in 2002. Employment reached its high mark in 2001, at over 310,000 jobs, and has since declined to approximately 303,000 jobs. These figures probably understate both employment and its recent decline, due to their household (rather than establishment) base.
Sectoral Analysis
There was a shift from manufacturing to services during the 1993–2000 expansion. Though manufacturing employment grew slightly, the sector's share of employment slipped from 25.0 percent to 20.8 percent. Services gained a bit more than manufacturing lost, rising from 33.2 to 37.9 percent of employment in the region.
There was no change in the industries that were the region's top five employers from 1993 to 2000, though rankings shifted. When using annual payroll to identify the region's top industries, educational services and eating and drinking were replaced by wholesale trade/durable goods and by industrial and commercial machinery and computer equipment.
The Commonwealth lays legitimate claim to being the birthplace of American industry, with the Northeast Region at its core. While the importance of manufacturing has declined in the Commonwealth as in the nation, it remains critical to the region's economic well-being. Manufacturing establishments provided 20.8 percent of employment in the region in 2000, well above the state figure of 13.4 percent.
Pay in high-tech manufacturing establishments often far exceeds the state's average. Computer and related hardware manufacturing pays in excess of 185 percent of the state's average wage, industrial machinery manufacturing pays 174 percent, instruments 164 percent, and electronic equipment 151 percent. Because of these relatively high wages, manufacturing in the Northeast Region generates 29.5 percent of total payroll, compared to 16.7 percent statewide. Largely on the strength of its high-tech manufacturing sector, real average wages in the region have tracked higher than the state average since 1995, widening the gap dramatically since 1998.
Twenty-first-century goods producers place great emphasis on capital-intensive activities, and their investments often result in purchases from other firms in the region and the state. Goods producers also rely more and more on research into such things as new materials, the life sciences, opto-electronics, and wireless communications. Much of this research is conducted at colleges and universities and in private laboratories in the Northeast and Greater Boston Regions. Manufacturers apply state-of-the-art technologies to boost employee output. They contract for many business services, such as payroll preparation, benefits calculation, market research, and specialized production, boosting the regional economy. Manufacturing's significance thus spreads well beyond the employment figures.
Population
A strong economy contributed to an 8.6 percent increase in the region's population. This compares favorably to 5.5 percent growth across the Commonwealth and resulted in a slight gain in the region's share of the state population.
The region's population is aging. In the 1990s, its median age increased from 32.3 to 35.3 years, compared to the Commonwealth's increase from 33.8 to 36.6. Residents aged 19 to 44 made up 45 percent of the regional population in 1990 but only 40 percent in 2000. This worrisome trend implies the loss of a portion of the college-educated skill base. The region cannot expect much relief in the future: the 19- to 24-year-old cohort fell more than 20 percent in the 1990s, from 58,733 to 46,845. Just as this skill-base loss poses a significant challenge, so does the growth of the under-18 population. Cities and towns are expected to educate this burgeoning group, a task made difficult by any protracted economic downturn or decline in tax revenues.
The largest population gain occurred in the 45-to-64 age group. As these older workers retire, they will join the under-18 cohort in requiring an array of public ser-vices, such as day care and elderly housing. The falloff of residents 19 to 24 along with low growth among 25- to 44-year-olds portends labor shortages and a shrinking taxpayer base.
Outlook
The Northeast Region has an impressive concentration of innovative high-tech firms. They are supported by a diverse subset of locally owned companies and a host of agencies and organizations concerned with issues such as job training, immigrant business assistance, and affordable housing. The region also has public and private higher education institutions, including the University of Massachusetts Lowell, Northern Essex Community College, Middlesex Community College, and Merrimack College, all of which are deeply committed to the social and economic development of northeastern Massachusetts. A number of issues will need to be addressed in the region—workforce training, the redevelopment of brownfields, diversifying the economic base—in order to ensure continuing prosperity.
» Top
|
