Before focusing on the positive, however, we should review the past as a basis for future directions. The Bureau of Economics Analysis of the U.S. Dept. of Commerce recently released new estimates of Gross State Product (GSP). For the period of 1987 to 1994, total GSP for the United States rose at an annual rate of 2.3%. For New England that figure was 1.0%, and for Maine it was 0.9%. Of the 50 states, Maine ranked 48th in change of GSP. Only Rhode Island and Alaska ranked lower. In the 1987-1994 period, output in construction and manufacturing actually declined.
Moreover, per capita personal income (PCPI) changes have not been favorable. In 1996, Maine's PCPI was $20,826, below the national average of $24,231 and lower than any other New England state. Maine's PCPI ranked 37th in the nation, a considerable decline from its position of 26th in the latter part of the 1980s. Furthermore, Maine lags even New England with respect to PCPI changes. In 1996, Maine's PCPI annual growth rate was 3.4% compared to 4.5% at the national level and the lowest in New England. In this category, Maine ranked a dismal 44th among the states.
So, what is the positive news? One thing is that, practically speaking, the only change in direction is upward. Another is that our forecast of the Maine Business Index shows continued improvement. We project that the manufacturing sector, which has rebounded in the past year, will remain relatively strong, and that the service sector will gain strength during the rest of the year. Other good news is that the number of jobs has increased and the number of unemployed has decreased. Maine's unemployment rate has improved from above the national average to something near the national average. Nevertheless, the geographical gap in the state persists. Maine's southern tier is enjoying a good measure of economic prosperity, while the northern part continues to wrestle with relatively low incomes, high unemployment rates, and, in some cases, declines in jobs and population.
In the final analysis, our prospects are for continued slow growth. It is unlikely that any of the relative rankings mentioned above will markedly improve, but there is a strong likelihood that they will not get worse.
R.C.M.
Business Forecast Systems
68 Leonard Street
Belmont, MA 02178
Tel.: 617-484-5050
http://ourworld.compuserve.com/homepages/forecastpro
1995 |
1996 | |||||||
1987 = 100 |
Raw DataUnits |
Assigned Weights |
JAN |
FEB |
MAR |
JAN |
FEB |
MAR |
MAINE BUSINESS INDEX(Composite) |
106.5 |
110.5 |
107.9 |
111.8 |
111.0 |
111.9 | ||
Truck freight on Turnpike <1> |
(tons) |
2.1% |
153.6 |
155.3 |
142.6 |
158.0 |
154.9 |
154.8 |
Automobiles on Turnpike <1> |
(number) |
26.4% |
124.4 |
134.8 |
128.4 |
142.5 |
134.5 |
136.5 |
Construction employment <2> |
(workers) |
6.5% |
72.3 |
72.7 |
73.6 |
80.8 |
80.3 |
81.4 |
Manufacturing production <2> |
(hours) |
21.3% |
100.8 |
100.9 |
102.2 |
102.7 |
103.1 |
104.3 |
Fish landings <3> |
(pounds) |
0.7% |
129.3 |
198.9 |
124.2 |
141.0 |
135.2 |
131.8 |
Electricity sales <4> |
(kwh) |
3.1% |
99.3 |
113.8 |
103.8 |
109.3 |
107.7 |
105.5 |
Agricultural sales <5> |
(1982 $) |
1.4% |
108.6 |
98.4 |
101.1 |
92.2 |
92.1 |
94.0 |
Hotel and motel receipts <6> |
(1982-84 $) |
1.0% |
101.8 |
116.0 |
111.5 |
119.2 |
106.4 |
113.1 |
State government expenditures <6> |
(1987 $) |
13.1% |
110.9 |
104.4 |
114.0 |
100.8 |
116.1 |
118.4 |
Retail sales, less motel receipts <6> |
(1982-84 $) |
18.2% |
94.9 |
101.1 |
93.4 |
97.3 |
95.3 |
93.6 |
Total deposits <7> |
(1987 $) |
6.3% |
95.9 |
95.8 |
95.6 |
95.8 |
95.8 |
95.7 |
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. | ||||||||
