Maine Business Index

Maine Business Indicators

Based on the Maine Business Index, our past modest growth has become even more sluggish. Among the eleven components in the Index, there does not seem to be any single factor that would account for this change. Most likely, events outside of Maine but within New England are the basis for the lackluster performance. The decline both in manufacturing jobs and in inflation-adjusted family income -- not entirely unrelated trends -- are important factors. This is especially true in New England, where manufacturing jobs were disproportionately important ten years ago.

Maine's unemployment rate is below that of last year though higher than the national rate. Within the state there are considerable differences among the Labor Market Areas. In April of this year, a number of LMAs had double-digit unemployment rates. Fort Kent had the highest unemployment rate of 16.8%. The Kittery-York area enjoyed the lowest rate of 1.7%. This north-south distinction is representative of the statewide situation, with Aroostook and Washington counties experiencing double-digit unemployment rates.

Over the past year, the Maine economy has added about 25,000 jobs, and the number of unemployed has declined slightly. While this is good news, it does not offset the structural changes taking place, which apparently are working against us.

At this point, it appears that we are in a holding pattern with nothing on the horizon to give us a boost. The national and New England economies are the master of our fates until such time as Maine can radically distinguish itself as a state with especially wonderful natural and/or human resources. While we cannot do much about our natural resource endowment, we can affect the quality of our human resources -- if we choose to do so.

The careful reader will note that we have changed one of the components of the Maine Business Index. In the past, we have used demand deposits as a gauge of economic activity in the finance, insurance, and real estate (F.I.R.E.) sector. We are now using total deposits, which include not only demand deposits but NOW accounts, certificates of deposit, and long-term savings accounts as well. The previous lack of these additional items did not materially affect the index measuring F.I.R.E., but now the measurement is all the more accurate.

R.C.M.

MAINE BUSINESS INDEX

1994-1995
1995-1996
1987 = 100
DEC
JAN
FEB
MAR
DEC
JAN
FEB
MAR
Composite
103.96
106.99
106.08
106.22
102.10
107.55
111.07
105.78
Truck freight on Turnpike 1
148.05
146.19
141.06
147.48
142.68
153.62
155.32
142.62
Automobiles on Turnpike 1
127.12
125.94
124.90
126.63
120.50
124.38
134.79
128.41
Construction employment 2
75.95
66.13
70.21
71.66
76.67
87.49
86.59
78.80
Manufacturing production 2
101.78
101.05
101.67
101.14
100.72
101.85
101.97
103.38
Fish landings 3
109.67
134.54
134.78
151.71
112.82
130.04
121.54
121.54
Electricity sales 4
100.94
103.27
97.95
105.82
104.73
99.33
113.80
105.16
Agricultural sales 5
92.51
95.02
98.18
90.92
85.68
98.18
96.47
98.01
Hotel and motel receipts 6
110.35
115.45
109.07
112.97
114.66
101.75
116.02
111.48
State government expenditures 6
84.64
120.33
112.34
103.52
94.04
110.31
103.71
92.31
Retail sales, less motel receipts 6
94.15
90.85
92.48
95.37
89.58
94.80
101.01
93.30
Total deposits 7
96.23
95.83
95.53
95.23
95.69
98.81
98.65
98.48
SOURCES: 1 Maine Turnpike Authority; 2 Maine Department of Labor; 3 National Marine Fisheries Service; 4 Central Maine Power Company; 5 U.S. Department of Agriculture; 6 Maine Department of Finance and Administration; 7 Federal Reserve Bank of Boston.

FORECAST GRAPH OF THE MAINE BUSINESS INDEX

RETROSPECTIVE GRAPH OF THE MAINE BUSINESS INDEX

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