May 24, 2019
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Maine earns high marks for safety and environment but economy still lags, study says

Micky Bedell | BDN
Micky Bedell | BDN
The Maine state flag waves in a breeze outside Troy Howard Middle School in Belfast.

Maine’s gross domestic product lagged the nation, but beat New England, according to an annual assessment of the state’s economic health that was released Wednesday.

The report, “Measures of Growth,” found that Maine’s GDP grew by 1.9 percent from 2016 to 2017 from $54.6 billion to $55.6 billion. That trails the national average of 2.2 percent but is more than the New England rate of 1.4 percent.

It also found that while Maine continues to lead the nation in environmental and public safety measures, it also continues to struggle with business, community and workforce economic indicators.

The Maine Economic Growth Council released the report, which tracks 27 indicators that represent Maine’s assets and areas of persistent challenge.

[3 major things that need to change to grow Maine’s economy]

The 2019 report found that Maine made measurable progress on seven indicators, but lost ground on seven others, compared with benchmark numbers.

Among the positive indicators is safety. Maine’s crime rate is 40 percent below the national average, the report found. Also, the number of unhealthy or moderate air quality days continues to decline and were the lowest on record in 2018.

Courtesy of Maine Development Foundation
Courtesy of Maine Development Foundation

The water quality of Maine rivers and streams also is far above the U.S. average, and the growth-to-harvest ration of sustainable forest lands grew between 2016 and 2017.

Despite those successes, the growth council assigned five red flags to economic areas that need special attention.

Research and development spending declined $25 million between 2015 and 2016, ranking Maine 45th among the 50 states in expenditures.

[Analysis: After decades of plans for Maine’s economy, where’s the progress?]

Two key indicators of education, fourth-grade reading and eighth-grade math scores, also were troubling. In 2017, only 36 percent of fourth-graders were proficient in reading, equal to the national average but below the New England average by 7 percentage points.

In 2017, the proportion of eighth-grade students proficient in math fell to 36 percent after rising from 34 percent in 2007 to 40 percent in 2013. That’s 2 percentage points above the national average, but 3 percentage points behind the New England average.

Courtesy of Maine Development Foundation
Courtesy of Maine Development Foundation

Workforce continues to be an economic strain. Maine’s working age population continues to decline, and it is below the national average.

Health care spending remains at 17.8 percent of all personal expenditures since 2015. That’s higher than the national average, but 1 percentage point above New England’s average.

The report issued an urgent call to action for the state to develop a long-term economic plan to grow the economy and improve the quality of life for all Mainers.

“To truly make meaningful, sustainable progress, Maine must develop, commit to and implement a long-term strategy for growing the economy and establishing our state as a vibrant, desirable place to do business and raise a family,” said Steve Von Vogt, chair of the Maine Economic Growth Council.

[What to expect from Maine’s economy in 2019]

Among other report highlights, Maine’s total employment exceeded the pre-recession level for the first time in 2017. Another 4,500 jobs were added in 2018 for a total of 628,500 jobs.

The state’s poverty rate dropped from 12.3 percent to 11.3 percent in 2017, below the pre-recession level of 12.2 percent in 2007. The national and New England poverty rates are still slightly above their pre-recession rates.

After declining from 2016 to 2017, Maine exports increased by 4.2 percent from 2017 to 2018, but U.S. exports increased by 7.6 percent.

Maine’s cost of doing business index value has been stable at 110 since 2012. In 2017, Maine’s cost of doing business index ranked eighth highest in the United States, up from 10th in 2015.

 



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