This Week at Pioneer › Current Strategies Fail to Support Job Growth

The Commonwealth has failed to expand its job base since 1990, lagging the nation as a whole since 2002. This weakness in job creation is driven by the closing and contraction of existing firms, not relocation. Failure to Thrive: Job Creation and Loss in Massachusetts: 1990 – 2007, published this week, finds that job creation is driven by start-up firms and the expansion of existing firms, while attracting businesses from other locations plays only a minor role. The report presents three key findings:

• › Job creation in Massachusetts is stagnant in the long-term and worse since 2002. From 1990 to 2007 overall, Massachusetts lost several thousand jobs. Following the 2002 recession, the U.S. economy has created jobs while Massachusetts has lost jobs.
• › There is great volatility in the Massachusetts’ job market. Underlying the lack of net job growth in Massachusetts is a dynamic “churn” of job creation and destruction. An average of 670,000 jobs per year are created or destroyed.
• › Firm relocation into and out of the state, though a focus of the state’s economic development agencies, has minimal impact on employment, relative to other drivers like start-ups, expansions, closures, and contractions.

Read the full report here.