Business leaders tackle economic inequality, pandemic in Mainebiz forum

Courtesy / Jeff Fuhrer Economist Jeff Fuhrer was the keynote speaker at Thursday's Mainebiz "Five on the Future" event, held virtually for the first time. More than 480 people registered.

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By Renee Cordes

While race- and ethnicity-based economic inequality long predates the pandemic, disparities have widened over the past year, economist Jeff Fuhrer told a Mainebiz virtual forum on Thursday.

Fuhrer, a former top official at the Federal Reserve Bank of Boston, is now executive vice president and chief strategy officer at MassDevelopment, that state's finance and development agency.

In his opening keynote of the "Five on the Future" discussion, Fuhrer questioned whether the United States is the land of opportunity it purports to be, saying, "I'd like to believe that's true, but we're pretty far from that."

Backing up that point, he cited 2018 data showing discrepancies in income distribution for Black and Latino families versus white families.

Fuhrer also presented data from Brunswick, Maine, and from Mobile, Ala., illustrating how income and wealth gaps can relate to a person's place of birth.

"The accident of birth, where you were born and in which location, has a serious impact on what your lifetime earnings are going to look like," he concluded. "That's startling."

More than 480 people registered for the annual, one-hour forum, which kicks off a season of events for Mainebiz. Held remotely for the first time, Thursday’s edition started with 30 minutes of networking on the Remo platform.

Panelists included Dava Davin, Portside Realty Group founder and principal and a 2018 Mainebiz Woman to Watch; Jessica Estes, Boulos Co. partner and designated broker; Jennifer Hutchins, executive director of the Maine Association of Nonprofits; Curtis Picard, president and CEO of the Augusta-based Retail Association of Maine; and Volk Packaging President Derek Volk.

'Not a political issue'

Turning his attention to the causes of income and wealth inequality, Fuhrer said that institutions and policies going back generations directly and indirectly discriminated against people of color, giving several examples of measures that excluded non-whites.

He also emphasized that "this is not a political issue," noting that President Ronald Reagan's war on drugs and President Bill Clinton's welfare reform both "did serious damage to many communities of color."

Fuhrer said there are many pieces to the solution, from changing the narrative about the reason for the disparities to rewriting tax laws that disproportionately favor more affluent and wealthier white homeowners.

He also said that all solutions entail considerable cost, and that the focus should be less on redistributing wealth and more on bringing people into the workforce so that all of society benefits.

"The real goal," he said, "is to increase the size of the pie for everyone."

Panel discussion

During the discussion that followed, panelists shared their thoughts on how they see their company or sector helping address institutional inequities in the economy.

On a practical note, Estes of Boulos Co. said she'd love to see programs developed to provide startup capital for small business owned by people of color, women and others, noting that "having access to capital for small businesses is so key."

Hutchins said the nonprofit sector had already shown early leadership in this year in working with disadvantaged populations and coming up with the creative solutions.

She suggested that business people get to learn more about tribal and immigrant communities by showing up to their events and establishing personal connections "so we can start to grow those communities together."

Screen shot of Jennifer Hutchins of MANP speaking at virtual event

Screen shot/Mainebiz

Jennifer Hutchins, executive director of the Maine Association of Nonprofits, speaking at Thursday's event.

Picard said there's an economic imperative for that as well. Maine needs to bring 140,000 people into its aging workforce in the next 10 years, and he said, "Working with diverse populations is how we're going to achieve it."

As for the obstacles, Volk talked about the difficulty of diversifying a workforce in a state as white as Maine. He also underscored that while the United States is not perfect, there are opportunities in this country, citing Bill Clinton's path from poverty to the White House.

Davin called on all companies to do more to tackle racism in areas from employment manuals to marketing strategies.

"We have to look at everything we're doing to create a more inclusive environment," she said. "If we all do something, it is going to change."

The rest of the discussion centered on changes in business and work practices brought about by the pandemic, from virtual real estate tours to greater use of technology by retailers and restaurants. Picard also said the pandemic showed how interconnected the economy is, while Volk predicted continued growth of people buying things on line.

Reminding viewers that the pandemic isn't over yet, Hutchins noted that a lot of sectors of the economy are still suffering and will need support through 2021. She also cautioned that the effects of the pandemic "will be with us for a long time."