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Maine
Business and Economic Indicators: What's Right With
Maine!
Despite a constant stream of criticism about what's wrong with
Maine, the fact is that Maine is performing strongly, and is leading
New England in areas like job creation and the low cost of doing
business. Rather than feed the self-fulfilling dark prophecy, we
choose to to talk about What's Right with Maine, while working
always to make improvements.
Cost of Doing Business
- Maine has been ranked by the Milken Institute Study as the
state with the lowest cost of doing business in New England.
[August 2005]
- Maine recorded the second largest decrease in the cost of
doing business between 2004 and 2005, and was surpassed
only by West Virginia.
- Maine dropped from 16th in the nation in 2004 to 19th in
the nation in 2005 with respect to the cost of doing business
[The smaller the ranking number - the higher the cost of
doing business].
- In 2004, Lewiston-Auburn ranked 38th in the nation with
respect the best small cities for doing business. [Inc.
Magazine]
- "American City Business Journal" ranked Portland
as the "hottest" small business market in the nation. "Inc.
Magazine," 2004, ranked Portland 15th among medium-sized
cities in the nation with respect to the best cities for
doing business. [Inc Magazine]
- New Company Growth. In 2003 Maine ranked 22nd in the nation
with respect to the number of new companies [6.1] per 1,000
of employees. In that year, 4,033 new companies were created
in Maine.
- Economic Momentum. In 2004, Maine ranked 25th in the nation
with respect to economic momentum.
- Workplace Fairness. Maine was recently ranked by a University
of Massachusetts - Amherst study as 4th best in the nation
with respect to workplace fairness. This includes job opportunities,
job quality, and workplace fairness.
- Top 10 in the Nation. The 2005 "Assets and Opportunities" ranking
published by the Corporation for Enterprise Development, gives
Maine an overall "A" ranking that only 10 states
received. The criteria include financial security, business
development, tax policy, education, healthcare, and home
ownership.
- Information Technology and Telecommunications. "Foreign
Direct Investment Magazine," a sister publication of the "Financial
Times" of London, ranks Maine 3rd best in the nation,
in a tie with Texas and Maryland, with respect to information
technology and telecommunications infrastructure.
Factors Impacting the Cost of Doing Business
- Supply of Capital. In 2003, with $30,837 per capita of financial
institution assets, Maine ranked 12th in the nation with respect
to the most financial institution assets per person.
- Low Industrial Electricity rates. In 2003, Maine ranked
49th lowest in the nation with respect to the average cost
of electricity per kilowatt hour for industrial customers.
In Maine the average cost was3.5 cents per kwh and the
national average cost was 4.9 cents per kwh.
- Low Unemployment Insurance Tax. In 2004, Maine ranked 39th
lowest in the nation with respect to the unemployment insurance
tax index,
- Low Corporate Income Tax. In 2004, Maine ranked 40th lowest
in the nation with respect to the corporate income tax
index,
- Low Workers' Compensation Disability Payments. According
to "Congressional Quarterly State Fact Finder, 2005," Maine
ranks 38th lowest in the nation with respect to workers'
compensation disability payments. The maximum weekly benefit
in Maine for
disability payments is $506, compared to the average of $624.51
for all 50 states. Workers Compensation rates in general,
have dropped from the most expensive in the nation to squarely
in
the middle.
- Healthy Workforce. Dirigo Health has saved the health care
system $44 million, and prospective savings in the future
are expected to be much greater. Dirigo Health is the fastest
growing
insurance product in the state.
- Healthy Workforce. Maine has been ranked by the United
Health Foundation and the American Public Health Association
and Partnership
for Prevention as the nation's 8th healthiest state in
the nation.
- Maine moved up from 10th place in 2004 to 8th in 2005.
Included in the ranking are Maine's high marks for health
insurance
coverage, prenatal care, infant mortality, low rate of
cardiovascular deaths and low rate of infectious diseases..
- Since 1990, Maine's infant mortality rate has fallen 39%
and the percentage of children living in poverty has declined
by 35 percent.
Performance of Maine Based Companies and the Economy
- According to the Maine Securities Corporation, the stocks
of Maine-based companies outperformed the major stock indexes
on Wall Street in 2004 for the fifth consecutive year.
The Russell 2000 index which tracks smaller company stocks,
reported
a 17% return for Maine businesses.
- By comparison, the Standard and Poor's index rose 9 percent,
the Nasdaq composite index rose 8.6 percent, and the Dow
Jones Industrial Average increased 3.2 percent.
- From 1998 to 2002, Maine experienced a 7.2 percent increase
in per capita gross state product, which ranked 9th highest
in the nation - compared to a 4.4% growth rate nationwide.
Economic Outlook
- State economic officials indicate that 2005 will outperform
2004 with respect to commercial activity and economic performance.
- Commercial construction is expected to reach more than
$800 million compared to $551 million in FY 2004. Associated
Builders
and Contractors, a trade association, indicate an 11% increase
in commercial and industrial sector activity over 2004.
- The increase in state revenue projections of $164 million
over the 2006-2007 Biennium along with booming construction
activity indicate that the Maine economy is strong.
Jobs and employment
- Maine added 5,200 jobs between May 2003 and May 2004,
- Maine's unemployment rate of 4.7 percent in 2004 was the
33rd lowest rate in the nation,
- In 2004, Maine ranked 18th in the nation with respect to
the percentage [95.3%] of the labor force that is employed,
- Maine has added 15,000 new jobs over the last three years.
Personal Income
- While Maine ranked 41st in median household income in 2003
[$37,619], personal income growth in Maine outperformed
most states.
- Between 2002 and 2003, Maine experienced a 4.1 percent
increase in personal income, which ranked 14th highest in
the nation
- compared to a 3.2% growth nationwide.
Fiscal Management - Governmental Efficiency
- Bond rating companies and Wall Street give Maine high marks
for fiscal management.
Maine has imposed on itself a bond repayment limit of 10
years, while most states pay off their bonds over a 20 year
period.
Maine has a statutory spending cap for all levels of government.
- Structural Debt Reduction. Maine has reduced its structural
debt from $1.2 billion in FY 2004 - 05 to $350 million
in FY 2008-09 - a 75 percent decrease.
- Controlled Spending. Overall State spending from FY 2002
through FY 2007 has increased at a pace of 3.1%, the lowest
growth rate in 30 years. Since FY 2000, the average annual
increase in the General Fund Budget has been 1.5 percent.
- State Workforce Cuts. Since 2002, the State workforce has
been reduced by nearly 500 positions
- Consolidated State Government Functions. The accounting
and payroll processes have been overhauled and reorganized
to become more efficient and much more of a problem solving
organization with more accountability.
State and Local Government Data
- According to two publications, Congressional Quarterly's "State
Fact Finder - 2005" and a the Morgan Quitno publication "State
Rankings - 2005" that rank each state based on data
from 2003 and 2004, Maine ranks:
State and Local Government Spending
- 25th in the nation with respect to per capita state and
local government total expenditures
- 41st in the nation with respect to total State Government
spending
- 20th in the nation with respect to per capita state
government expenditures
State and Local Government tax revenues
- 40th in the nation with respect to total State government
tax revenues $2.697 billion]
- 15th in the nation with respect to per capita state government
tax revenues
- 8th highest in the nation with respect to per capita local
government tax revenues
- 31st in the nation with respect to corporate
income tax collections per capita
- 35th in the nation with respect to state and local sales
and gross receipts tax collections per capita,
Total Revenues
- Maine ranked 40th in the nation with respect to total State
Government revenue [$5.45 billion] and 40th with respect
total local government revenues [$3.62 billion]
- Maine ranked 17th in the nation with respect to per capita
total state government revenues [$4,201] and 37th with
respect to per capita total local government revenues [$2,792]
State and Local Government Employees
Highways
- 7th in the nation with respect to the percentage of total
mileage under State control
Education
- 4th in the nation with respect to the number of education
employees per 10,000 population;
- 0th in the nation with respect to spending per pupil in
2003 [Maine =$9,289; National average = $7,833];
- 46th in the nation with respect to
the number of pupils-per-teacher. In other words, Maine has fewer pupils [12.8] per teacher than 45 other
states;
Health Care
- 36th with respect to the number of Medicaid enrollees in
2002 [221,230];
- 17th with respect to Medicaid spending per enrollee in
2002 [$6,464]
- 45th with respect to the rate of increase in Medicaid
expenditures from 1998 to 2002 [Maine = 26.9%]
- 47th with respect to Medicare payments per enrollee [Maine
= $3,993]
Quality of Life
- The National Social Health of the States ranks Maine 4th
in the nation for a range of indicators, including:
- low infant mortality – lowest in the nation
- high school
completion rate – 1st in the nation
- low homicide rate – 5th lowest in the nation,
and
- low elderly poverty – 8th lowest in the nation
among others.
- From 1997 to 2003, Maine’s teen smoking rate dropped
50 percent, from 39 percent of teens to 20 percent. This
was attributed in large part to holding firm on our commitment
to use tobacco settlement monies for outreach programs
such
as the Fund for Healthy Maine and a toll free hotline that
helped 4,700 people quit in 2002 alone.
- Teen pregnancy dropped 45 percent in Maine from 1990 to
2001.
- Crime rates in Maine are consistently low, ranking 5th
lowest in the nation for homicides in 2003.
- Our state is on the leading edge of mercury reduction efforts.
(These efforts also proved that responsible businesses
embrace rules that ask them to do the right thing. Hewlett
Packard
and other corporations supported, and actively participated
in the e-waste bill, which requires manufacturers of TV’s
and computer monitors to recycle those items to keep mercury
and other toxics out of the air and water.)
- Maine also has one of the first laws in the country to
set responsible global warming goals for our own state, so
that
Maine can do its part.
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