Commission: No Silver Bullet for Massachusetts Job Creation

Above: Senator Karen Spilka, co-chair of the Jobs Creation Commission, presents the final report

For the past two years, a 17-person commission has been looking at what it will take to create more jobs here in Massachusetts. Yesterday, the commission released its 90-page report, which, to no surprise, contained no silver bullet for job creation.

So how do we create jobs and build a stronger economy here in the Commonwealth?

A heavy emphasis was placed on investing in infrastructure like roads, water and sewers. ICIC research has found this is particularly important to inner cities. Inner cities have high concentrations of infrastructure assets, including water ports, intermodal facilities and the country’s largest airports. Per square mile, the average inner city has roughly 100 times as many of these assets as the rest of the U.S. This infrastructure is at the core of regional transportation and distribution systems. By investing in inner city infrastructure, Massachusetts has a great opportunity to strengthen the competitiveness of both local and regional economies.

The report noted the need to overcome employment barriers for disadvantaged populations and close the disparities—one way to do this is through better infrastructure. While Massachusetts has fared better than most states during the recession, unemployment in many of the state’s “Gateway Cities” is significantly higher; Lawrence’s unemployment rate hovers above 11% and New Bedford is nearly 10%. The report finds that areas with higher unemployment both lack quality infrastructure and have fewer higher educational institutions.

On its own, the bridge quality gap has cost inner city economies between 2% and 3% of their total job base—or upwards of a quarter million jobs nationwide—affecting key industries such as transportation, logistics and professional services. Infrastructure investment in America’s inner cities offers the best opportunity to restore these lost jobs. ICIC research found that a 10% decrease in the percentage of deficient inner city bridges is correlated with a 1.83 increase in inner city growth and a 1.69% increase in regional growth. So, as the commission aptly found, we have the opportunity to literally build bridges to jobs.  

The report also focused on aligning higher education and workforce training programs to the jobs that are available. By some estimates, there are 119,000 jobs going unfilled in Massachusetts because employers cannot find workers with the appropriate skills. “There’s nothing more friendly to business than a highly qualified, highly trained, highly skilled workforce,” said Tim Franklin, President of the Massachusetts AFL-CIO.

Governor Deval Patrick has made it a priority to align curriculum at community colleges to help retrain middle-skill workers, or those with high school diplomas but less than a four-year degree. Many once-skilled workers are having a difficult time transitioning to new careers, so the Commonwealth must fund training for next generation, high-growth industries; the Commission suggested doing so through one-stop career centers.

Lastly, the commission highlighted the need to support small business growth. According to the U.S. Small Business Administration, small firms represent 99.7% of all companies; employ half of all private sector employees; pay 44% of total U.S. private payroll; and generated 65% of all new net jobs over the past 17 years.

Massachusetts has struggled with high taxes and regulatory burden for small businesses over the years; the commission recognized the need to reduce and simplify regulation. There must be a concerted effort to push back on the growth in health care costs, unemployment insurance, and workers’ compensation. April Anderson Lamoureax, Assistant State Secretary of Economic Development, said that she thinks Massachusetts would benefit from a change in perception, “so that folks here as well as folks outside of Massachusetts know that we’re open for business, we welcome business and we want to help them grow.”

Certainly, we did not need a report to tell us there is no silver bullet for job growth. There never is—not here in Massachusetts or elsewhere. However, the Commission’s findings are on the right track to supporting job growth here in Massachusetts. Investment in workforce development, infrastructure, and small business growth could have a profound impact on job creation within our inner cities especially.

BY Amanda Maher on October 4th, 2012

TAGS: massachusetts | economic development | infrastructure | workforce development | gateway cities | jobs | business development