Saturday, April 28, 2007

The Mass Economy Growing Massively?

Apparently, that's the case. We're growing leaps and bounds above the rest of the country, despite everything. Let this be a lesson to all the doubters in this state: businesses can be successful here even if it's more expensive.

The state's economy grew at a 4.7 percent annual rate in the first quarter, the fastest pace in nearly 7 years, according to a report yesterday from the University of Massachusetts. The US economy grew at a 1.3 percent rate, its worst performance since early 2003, the Commerce Department said.
The question is "how many people are enjoying this surge?" Is it just going to the businesses, who won't even accept having a normal, average tax rate? They're doing well, while regular people are breaking their backs trying to pay ever-increasing property taxes. In fact, they're making profits 4x greater than the rest of this country - yet expect Massachusetts to keep its infrastructure top notch on the back's of its citizens, without paying their fair share. Nice.

Here's what's driving the economy:

Technology, however, is again driving growth here, UMass analysts said. Global demand for the state's technology and medical products has increased, and that has fueled strong job growth, said Alan Clayton-Matthews, a professor of public policy at UMass-Boston and the UMass report's lead analyst.
No surprises there. Massachusetts is one of the most natural places to lead this country in terms of advancing technology, with the dozens of great Universities we have. It's something we need to truly incubate in other areas as well, such as developing renewable energy. There are entire brink cities that could be resurrected through growth of the tech sector, such as Lynn. Perhaps even the South Coast, with UMASS Dartmouth, or Greater Lowell, with UMASS Lowell, could benefit from the advancement of technology - by melding together the private and public sectors. An entire 20-30 story building is being constructed to test that theory in Boston, right next to where my best friend works in a Harvard medical research lab.

There was an interesting paragraph tossed in toward the end of the article, highlighting the differences between the Massachusetts economy and the rest of the country.
Massachusetts growth in the face of the national slowdown illustrates the different make-up of the state's economy. The nation depends primarily on consumer spending. Massachusetts, however, relies on business spending since it has a high concentration of firms that sell goods and services to other companies.
Bottom line? Our's is a much healthier economy. The figment of consumer spending, with trade imbalances every year and millions of low-wage jobs, hasn't been an awe-inspiring recipe for success. Yet, research and development has been successful for us. The only thing Massachusetts is missing as an economy is a little diversification - which means that when industries like tech falter, we're screwed. So, it's important that the Beacon Hill not just rest on its laurels with what we have now, merely happy to see job growth, and try to develop entirely new sectors or rebuild weak ones.

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