File photo / Tim Greenway
Steve Von Vogt, CEO of Maine Marine Composites
Updated: December 1, 2023
Nonpartisan group offers mixed grades on Maine's economic performance
Maine's economy has benefited from higher wages, an educated workforce and gains in internet connectivity — but is hampered by ongoing shortages of labor, affordable housing and other things, a report released this week shows.
The Maine Economic Growth Council, a nonpartisan group administered by the Maine Development Foundation, also said in its annual "Measures of Growth" report that the state continues to perform well on environmental stewardship and entrepreneurship.
But the report cited the pandemic's lingering effect on children’s mental health and learning, the high costs of housing and energy and other "systemic challenges continue to burden communities, businesses, and households," the group said in a news release.
“This report provides critical insight into Maine’s economy and workforce,” said Steve Von Vogt, CEO of Maine Marine Composites and co-chair of the Maine Economic Growth Council.
“We must continue to harness Yankee ingenuity, innovation, and public-private partnerships to capitalize on Maine’s unique strengths, respond our economic challenges, and eradicate systemic inequities.”
The "Measures of Growth" report tracks 31 indicators that represent Maine’s assets and areas of challenge.
The assets
The council assigned Gold Stars for significant progress in:
- Wages: In 2022, wages remained above the EPSCoR average but fell 1.5% after adjusting for inflation.
- Post-secondary degrees and credentials: In 2021, 55% of Maine adults had a credential of value, up from 53% in 2019 on the way to the overall goal of 60%.
- Internet connectivity: In 2023, 86% of Maine locations have either average or broadband internet, up 8%.
- Air quality: In 2022, there were 24 moderately unhealthy days, four fewer than last year.
- Water quality: In 2022, Maine maintained its excellent water quality rating.
- Sustainable forestlands: In 2021, the growth-to-removal ratio rose 8% to 1.43 and remained above the sustainability goal.
The challenges
The council assigned red flags for needed attention to:
- Labor force: Maine’s labor force shrank 1.5% to 675,000 in 2022.
- R&D: In 2020, Maine’s R&D spending rose from1% to 1.1% of GDP — but still significantly lags peer states and the target of 3%.
- Fourth-grade reading: In 2022, 29% of Maine 4th-graders were proficient in reading, a sharp drop from pre-COVID levels.
- Eighth-grade math: In 2022, 24% of Maine 8th-graders were proficient in mathematics, down from 34% pre-COVID.
- Cost of energy: The price of industrial electricity rose 17% in 2022, mirroring nationwide increases.
- State and local tax burden: In 2021, Maine’s tax burden remained unchanged at 11.7%.
- Housing affordability appears to have dropped in 2022, but complete data are not currently available.
- Mental and behavioral health: In 2020-21, the percentage of children with a mental and/or behavioral condition rose by 0.4%.
“Overcoming these challenges and building the workforce Maine needs will require attracting more working-age people from other states and countries, retaining more of the young people born here, and helping people of all ages, genders, abilities, races, and ethnicities to improve their skills and participate fully in our economy," said James Dill, co-chair of the Maine Economic Growth Council.
Creative initiatives
The report cited examples of creative initiatives to address some of Maine’s persistent challenges, including the story of the Nonantum Resort in Kennebunkport, which tackled the labor shortage by hiring people who were formerly incarcerated.
“We hope other employers are motivated by the story of our hiring program for formerly incarcerated Mainers,” says Colby Marvin Bracy, director of HR and philanthropy at the Nonantum.
“These employees are very loyal, in part because we gave them a chance and they feel valued, but more because they prove to themselves and society that they are capable and reliable. They show up for work on time, they are resourceful and they have great attitudes. It enriches the entire organization.”
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