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Board of Directors William H. Dunlap, Chair David Alukonis Eric Herr Dianne Mercier NH Economic Indicators – Where to Next? James Putnam Todd I. Selig Michael Whitney Daniel Wolf Martin L. Gross, Chair Emeritus Directors Emeritus Sheila T. Francoeur Concord Chamber of Commerce Concord, NH April 17, 2014 Stuart V. Smith, Jr. Donna Sytek Brian F. Walsh Kimon S. Zachos “…to raise new ideas and improve policy debates through quality information and analysis on issues shaping New Hampshire’s future.” 1 Economic Opportunity 2 Past economic growth was driven by high rates of migration Percent Change in NH Population 30.0% 24.8% 25.0% 21.5% 20.5% 20.0% 13.8% 15.0% 10.0% 11.4% 8.5% 6.9% 5.0% 0.0% 1950 1960 1970 1980 1990 2000 2010 Source: New Hampshire Center for Public Policy Studies, analysis of U.S. Census data Growth in NH’s population, capital and productive have declined, suggesting that New Hampshire’s economic experience of Tailwinds may have turned into headwinds? 3 The Urgency? • Strong demographic tailwinds have ended. • NH’s economy has fundamentally changed – 1990: high tech (2%) and manufacturing (25%) accounted for 27% of NH’s economy – 2010: high tech ( 4%) and manufacturing (15%) accounted for 19% of NH’s economy • Zero job creation between 2000 and 2010. 4 In this context, where should we invest? • • • • • • • • • Health Care Education/Workforce Natural and Cultural Resources Energy Fiscal Infrastructure Workforce Housing Regulatory Business Growth and Retention 5 Dashboard Development • NH Business and Industry Association stakeholder groups identified goals • Center developed a series of indicators that track with goals. – Example of a goal: “All New Hampshire residents are among the healthiest in the nation and have lifelong access to a high quality, affordable integrated and preventive health and community support system.” • • • • • Health Care Expenditures Per Dollar of Gross State Product, 2010 Age Adjusted Mortality Rates, 2011 State-specific Standardized Infection Ratios (SIRs), 2011 Percent Uninsured, 2011 Average Family Premium per Enrolled Employee For EmployerBased Health Insurance, 2011 6 Health Care (Example) State and U.S. Rank New Hampshire Total Health Care Expenditures as a Percent of Gross State Product (GSP), 2010 32 2011 Age State-specific Percent Adjusted Standardized Mortality Infection Uninsured Rates Ratios (SIRs): 2011 15 36 9 Average Family Premium per Enrolled Employee For Employer-Based Health Insurance Overall 49 37 Maine Massachusetts Vermont 49 30 47 28 6 16 50 24 1 4 1 3 40 50 47 48 13 17 North Carolina South Carolina Texas Virginia 21 41 8 6 37 42 29 24 26 42 23 41 34 45 50 21 17 33 30 27 29 47 34 19 7 Indicators Compared to neighbors and major advanced high tech manufacturing competitor states State and Rank New Hampshire Fiscal 17 Education & Workforce Regulatory 14 22 Cultural & Business Natural Growth & Workforce Housing Resources Energy Infrastructure Health Retention Overall 31 4 28 27 37 7 11 Maine Massachusetts Vermont 30 39 35 36 1 32 42 41 31 29 41 32 7 3 6 35 20 24 33 35 43 48 13 17 31 2 11 38 8 24 North Carolina South Carolina Texas Virginia 32 29 8 11 11 29 16 4 14 17 28 20 25 15 21 35 20 38 47 11 13 33 41 27 18 12 10 15 29 47 34 19 27 30 23 29 16 33 27 9 With whom are we competing? 8 Cultural and Natural Resources • State spending on natural resources per person • Percent of tree cover in urban areas • Domestic tourism spending per capita • Creative Economy Jobs Concentration • Voter turnout rate • Volunteering rate 9 Education, Labor and Workforce • Change in 35-44 population share, 2000 to 2010 • Percent of adult population with an associate degree or higher • Percent of population in Science and Engineering workforce • High school graduation rate • Student debt per person • Rate at which high school graduates go on to postsecondary institutions • Percent of children aged 3 to 4 years old enrolled in preschool 10 Fiscal Policy • State Business Climate Tax Index • Top Marginal Corporate Tax Rate • Public Health, Welfare, Hospital Spending per Person in Poverty • State Debt per Dollar of Personal Income • Public Government and Administration per Dollar of Personal Income 11 Energy • Industrial Electric Prices • Natural Gas Prices in Dollars per Million BTUs • Energy Consumption • Expenditures Per Capita • Energy Efficiency Rank 12 How Does NH Rank? 13 NH excels on “current climate” indicators Area WFHousing Regulatory EdWorkFrc Cultural EdWorkFrc EdWorkFrc EdWorkFrc Fiscal Fiscal GrowthReten Indicator Homeownership rates Pollution Abatement / $ Value Added High School grad rate Voter turnout rate Pct of pop in Science & Engineering workforce Pct w/Associates+ Percent of children aged 3-4 in preschool State Business Tax Climate Index Public health/welfare spending per person in poverty Manufacturing Supercluster Concentration (LQ) NH Rank 2 3 4 4 5 6 6 7 7 7 14 But NH lags on “future climate” indicators Area Fiscal Infrastructure WFHousing Health Fiscal Energy GrowthReten Regulatory EdWorkFrc EdWorkFrc Indicator NH Rank Top marginal corporate tax rate 38 Percent of bridges deficient or obsolete 39 Owner costs more than 30% of Income 43 Health Care Expenditures per Capita by State of Residence, 2009 43 State debt per $ Personal Income 45 Industrial Electric Prices 46 Capital Investment Projects per 100,000 pop 46 Land Use Restriction 47 Change in 35-44 y.o share of population, 2000 to 2010 48 Average student debt 50 15 ou tm ar D re at er rd hu a te r ch es N as rM an rC on co 31.1% G re at e at e n 35.1% G re eg io R eg io n n eg io R R n eg io n s 36.5% G oa st Se ac k ad no c ee oo d eg io R R W 26.9% M on na p s ns ta i La ke ou n Su M e La k th / te W hi or th re at N G State averages hide large regional variation Percent of adult population with a B.A. or higher 37.6% 35.0% 31.4% 28.4% 14.7% 16 For its size, the Nashua-Manchester Corridor is in the top 10 with fastest growing companies 17 At the median …. Area • Merrimack Mirrors the state. Source: Daniel Lee, Plymouth State University US NH Strafford Hillsborough Cheshire Grafton Merrimack Rockingham Sullivan Belknap Coos Carroll Median Age, 2010 37.2 41.1 36.9 39.3 40.7 41.2 41.4 42.2 43.9 44.7 46.4 48.3 18 Size of Labor Force Working-Age Population (Age 20-64) US NH Strafford Hillsborough Cheshire Merrimack Grafton Rockingham Sullivan Belknap Coos Carroll % Change 2010-2030 1.0% -9.7% -2.4% -5.5% -8.9% -10.2% -11.2% -12.3% -14.7% -16.3% -20.0% -24.4% • Assuming no migration the workingage population in New Hampshire will decline nearly 10% in the state. • The northern rural counties will see larger declines. • Carroll County sees the biggest declines. Source: Daniel Lee, Plymouth State University 19 Skill of the Workforce % of persons 25 years old or over with BA or higher, 2000 United States 24% New Hampshire 29% Grafton 33% Rockingham 32% Hillsborough 30% Merrimack 29% Cheshire 27% Carroll 26% Strafford 26% Belknap 23% Sullivan 20% Coos 12% Source: Daniel Lee, Plymouth State University Gain in % of persons 25 years old or over with BA or higher, 19902000 United States 4.1% New Hampshire 4.3% Grafton 6.3% Rockingham 5.7% Strafford 4.8% Hillsborough 3.7% Merrimack 3.7% Sullivan 3.2% Carroll 3.1% Belknap 2.8% Cheshire 2.7% Coos 0.9% 20 Capital Stock Growth Areas United States New Hampshire Grafton Merrimack Cheshire Strafford Carroll Rockingham Sullivan Belknap Hillsborough Coos % change, 2000-2010 29.6% 30.0% 54.8% 38.9% 37.4% 36.0% 30.5% 28.2% 27.3% 25.9% 22.8% 13.6% Source: Daniel Lee, Plymouth State University • Grafton ranked the first in the state in the growth of private business investments during 2000-2010. • Only Grafton exceeded Merrimack. 21 Affordable Housing? 22 Job Growth Driven by Health Care Long-Term Occupational Projections 2010 - 2020 Merrimack County Occupational Group Total Employment 29-0000 Healthcare Practitioners and Technical Occupations 31-0000 Healthcare Support Occupations 43-0000 Office and Administrative Support Occupations 41-0000 Sales and Related Occupations 39-0000 Personal Care and Service Occupations 47-0000 Construction and Extraction Occupations 35-0000 Food Preparation and Serving Related Occupations 53-0000 Transportation and Material Moving Occupations 25-0000 Education, Training, and Library Occupations 13-0000 Business and Financial Operations Occupations 11-0000 Management Occupations 49-0000 Installation, Maintenance, and Repair Occupations 21-0000 Community and Social Services Occupations 37-0000 Building and Grounds Cleaning and Maintenance 15-0000 Computer and Mathematical Occupations 27-0000 Arts, Design, Entertainment, Sports, and Media 33-0000 Protective Service Occupations 51-0000 Production Occupations 23-0000 Legal Occupations 19-0000 Life, Physical, and Social Science Occupations 17-0000 Architecture and Engineering Occupations 45-0000 Farming, Fishing, and Forestry Occupations Prepared by: Economic and Labor Market Information Bureau 2010 Employment 80,051 4,873 3,440 12,745 8,005 2,979 2,981 5,331 4,378 5,290 4,150 6,815 2,864 1,542 2,604 1,232 1,141 1,964 4,121 990 802 1,282 522 2020 Projected 88,026 5,891 4,384 13,477 8,643 3,580 3,530 5,767 4,851 5,735 4,541 7,177 3,152 1,803 2,851 1,381 1,260 2,092 4,093 1,067 868 1,340 543 Average Annual Openings Percent Numeric Change Growth Replacement Total Change 2,692 1,842 850 10.0% 7,975 197 95 102 20.9% 1,018 143 48 95 27.4% 944 362 272 90 5.7% 732 317 252 65 8.0% 638 135 73 62 20.2% 601 122 66 56 18.4% 549 221 174 47 8.2% 436 150 103 47 10.8% 473 160 116 44 8.4% 445 123 84 39 9.4% 391 184 146 38 5.3% 362 97 66 31 10.1% 288 59 33 26 16.9% 261 72 46 26 9.5% 247 39 24 15 12.1% 149 46 31 15 10.4% 119 68 54 14 6.5% 128 90 76 14 -0.7% -28 25 17 8 7.8% 77 31 24 7 8.2% 66 34 28 6 4.5% 58 17 14 3 4.0% 21 23 Looking forward: The ecology of a successful economy There’s this … • • • • • • • Human Capital Financial Capital Economic Creativity Business Base Costs of Business Infrastructure Quality of Life And then … Brad Feld • • • • • • • • • • • • A Strong Pool of Tech Founders Local Capital Killer Events Access to Great Universities Motivated ‘Champions’ Local Press, Organizational Tools Alumni Outreach Wins Recycled Capital Second-Time Entrepreneurs Attractive to Engineers Tent-pole local tech companies 24 How does this relate to existing initiatives • Many initiatives designed to deal with perceived long term issues. – Governor Hassan: Innovate NH Jobs – Former Governor Lynch: The green launching pad – New use of unemployment funds – train individuals to build new small businesses. – Community College System • Hypertherm and Community College collaboration • The Advanced Manufacturing Partnership (Albany) – UNH Innovation – UNH, STEM initiatives (NHCF, Business NH coalition) – Granite State Futures – planning generally – housing and transportation. – Stay, Work, Play. • Question: Are they working? Is there a problem? – Are conditions getting better/worse? – What about regional approaches 25 What is the goal of economic development? • • • • • Targeting Industries? State efforts to amplify ‘economic ecology’ development? Retention of existing businesses? Targeted Industry development? What/which tactics are necessary to meet strategic goals? – Enhance human capital? Workforce Development (make your own vs. import) – Workforce housing? • How does one align and amplify existing efforts given scarce human and financial resources? 26 New Hampshire Center for Public Policy Studies Board of Directors William H. Dunlap, Chair David Alukonis Eric Herr Dianne Mercier James Putnam Todd I. Selig Michael Whitney Daniel Wolf Martin L. Gross, Chair Emeritus Directors Emeritus Sheila T. Francoeur Stuart V. Smith, Jr. Want to learn more? • Online: nhpolicy.org • Facebook: facebook.com/nhpolicy • Twitter: @nhpublicpolicy • Our blog: policyblognh.org • (603) 226-2500 Donna Sytek Brian F. Walsh Kimon S. Zachos “…to raise new ideas and improve policy debates through quality information and analysis on issues shaping New Hampshire’s future.” 27