Mainebiz

V O L . X X V N O. I JA N UA R Y 7 , 2 0 1 9 16 2 0 1 9 E C O N O M I C O U T L O O K F O C U S E C O N O M I C D E V E L O P M E N T Maine needs business and job growth to reach national levels B y P e t e r V a n a l l e n J im Damicis is a senior vice president at Camion Associates, an economic development firm with five offices, including one in Scarborough. He has more than 25 years' experience in public policy research and analysis and has been a frequent contributor to Mainebiz. We asked him for his analysis of the coming year. Mainebiz: What are some growth areas in Maine's economy? Jim Damicis: With an estimated 700,000 jobs in 2018, Maine has experienced job growth over the past year at a rate of 0.22% and past five years at 2.7%. While positive, this is half the growth rate experienced in the U.S. One-year trends by indus- try sectors do show positive signs in Maine with increases experienced in manufacturing, finance and professional/technical sectors, all which have higher than average wages. MB: Is there still pent-up demand for real estate — both residential and commercial/industrial? JD: e Maine real estate market has been experiencing positive trends. Demand for industrial properties has increased leading to both new develop- ment and redevelopment opportunities. Driving this is demand for smaller, flex spaces and spaces that integrate manufacturing, assembly and distribu- tion. On the residential side, new construction has been strong, particularly in southern and coastal Maine. is has driven post-recession economic growth nationally and in Maine. Changing market dynamics call for multi-family and workforce housing, and housing to meet the needs of an aging population — from active senior living, to independent and assisted living. ese types of housing were sorely lacking pre-recession. MB: What are some areas of concern as you look at the economy in 2019? JD: While the improved real estate market is positive, a major concern for Maine heading into 2019 and beyond is increasing business and employment growth to national levels — otherwise the real estate and construction trends will be temporary. We need to increase labor force participation. In Maine, as the number of jobs increased, the labor force participation rate decreased slightly from 64.8% to 64.4% from 2013-18. Maine must increase its labor force participation rate to be able to provide the needed workforce for expansion. is will require increased and sustained commitment to workforce training and supporting programs for populations that have been traditionally difficult to integrate into the workforce including displaced workers, recent immi- grants, veterans and persons that are disabled, in recovery from addiction, or with criminal records. G OV E R N M E N T P E R S P E C T I V E Pace of tourism may slow, but growth will continue B y l a u r i e s C H r e i B e r S teve Lyons, director of the Maine Office of Tourism, predicts continued growth in visitor numbers, but perhaps at a slower rate. Since 2012, Maine has seen about 5% annual average increase in visitation overall, and a first-time visitation growth rate of about 17% annually. First-time visitors have been a focus of the state's tourism campaign. "We've gone gangbusters with the campaign," he says. "So we're hopeful that will continue." The Maine office of Tourism is drafting its new five-year strategic plan, to be introduced in 2019. "We're still looking for growth," he says. But at some point, he says, the future rate of increase could be in the 2% to 3% range. "You can't sustain 5% percent growth," he continues. "Average growth around the U.S. is 2% to 3%. So we've been ahead of that, but as some point those numbers, I think, will come down a bit." Congestion at tourism hotspots will continue, he says, but so will efforts to address the issue. "We continue to try to promote alternative transportation, try to get people, for example, to consider tak- ing a train to Maine from Boston," he says. "The challenge we're probably going to see in the future is, how do you spread the people out into the more rural and remote areas in the state, because public transportation doesn't exist to do that." The state agency will also continue to promote destinations throughout the state, working with attractions off the beaten path to expand hours and update amenities such as wifi. He says providers and venues are making the shift and he expects that will continue. "Greenville is going through a trans- formation now," Lyons says by way of example. They did a rebranding a few years ago with an independent third-party group, and now have a working group to raise their visibility as a tourist destination." You can't sustain 5% percent growth. Average growth around the U.S. is 2% to 3%. So we've been ahead of that, but as some point those numbers, I think, will come down a bit. — Steve Lyons Maine Office of Tourism Maine must increase its labor force participation rate to be able to provide the needed workforce for expansion. — Jim Damicis Camion Associates P H O T O / C O U R T E S Y O F T H E M A I N E O F F I C E O F T O U R I S M P H O T O / C O U R T E S Y O F C A M I O N A S S O C I AT E S Steve Lyons Jim Damicis

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