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Christopher Geehern

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Employer Confidence Up Slightly in April

Posted by Christopher Geehern on May 8, 2018 8:48:02 AM

Business confidence strengthened during April as growing optimism among employers about the prospects of their own companies outweighed a more cautious outlook about the state and national economies.

BCI.April.2018The Associated Industries of Massachusetts Business Confidence Index (BCI) rose 0.7 points to 64.2 last month after falling a full point in March. The BCI has gained four points during the past 12 months and remains well within the optimistic range.

The April increase was driven by 2.6-point surge in the index measuring employer confidence in their own companies, along with a 2.5 percent jump in the Employment Index.

Those increases offset slippage in employer views of both the Massachusetts and US economies. The trend appears to be tied to specific issues such as imposition of the employer health-care surcharge in Massachusetts and commodity price increases stemming from the Trump administration’s tariffs on steel and aluminum.

“While business is good, I am not confident in the general direction and tax policies of the federal government. My impression is that short term gains will come at the expense of future economic, social, and environmental stability,” wrote one employer.

Raymond G. Torto, Chair of AIM's Board of Economic Advisors (BEA) and Lecturer, Harvard Graduate School of Design, said the confidence numbers reflect a solid economy that is growing modestly – 1.6 percent annually on the state level and 2.3 percent annually for the United States.

“The Massachusetts economy is operating at virtually full capacity, but growth is slowing due to constraints on labor,” said Torto.

“Employers are certainly concerned about public policy issues, but those concerns for the moment are minimized by the underlying strength of their businesses.”

The AIM Index, based on a survey of Massachusetts employers, has appeared monthly since July 1991. It is calculated on a 100-point scale, with 50 as neutral; a reading above 50 is positive, while below 50 is negative. The Index reached its historic high of 68.5 on two occasions in 1997-98, and its all-time low of 33.3 in February 2009.

The Index has remained above 50 since October 2013.

Constituent Indicators

The constituent indicators that make up the overall Business Confidence Index provided a study in contrasts during April.

The Massachusetts Index assessing business conditions within the commonwealth declined 2.8 points to 64.1, leaving it 0.8 points higher than in April 2017.

The U.S. Index ended the month at 63.9, down 1.3 points after rising 6.7 points during the previous 12 months. April marked the 98th consecutive month in which employers have been more optimistic about the Massachusetts economy than the national economy, though the gap has recently narrowed.

The Current Index, which assesses overall business conditions at the time of the survey, gained 2.5 points to 65.1. The Future Index, measuring expectations for six months out, declined 1.1 points to 63.3. The Current Index has risen 5.2 points and the Future Index 2.8 points since April 2017.

Operational Views

Employer views of their own companies were far brighter.

The Company Index increased to 64.3, up 4.1 points for 12 months. The Employment Index ended the month at 59.8, a 3.6-point increase for the year.

Manufacturing companies (65.3) remained more optimistic than non-manufacturers (61.1). Large employers (66.1) were more bullish than medium-sized (63.4) or small businesses (63.4).

“Massachusetts employers have maintained a positive view of the economy since the fall of 2013. The numbers move up and down in a small range, and there are certainly long-term concerns about labor availability, but business confidence remains comfortably in positive range amid a full-employment economy,” said Sara L. Johnson, Executive Director, Global Economics, IHS Markit and a BEA member.

Competitive Playing Field

AIM President and CEO Richard C. Lord, also BEA member, pointed to the recent announcement by Philips Lighting that it will end manufacturing at its Fall River plant as evidence that Massachusetts must still pay attention to the cost of doing business.

“Many of the employers who responded to the April Business Confidence Index Survey expressed concern about the new $200 million health-care surcharge and its effect on small business,” Lord said.

“The surcharge was levied to close a budget deficit in the MassHealth program for low-income residents. AIM continues to work with the Legislature to institute structural reforms that will put that program on sound financial footing for the long term.” 

Topics: AIM Business Confidence Index, Massachusetts economy, Employer Health Assessment

2018 Gould Award Honors Springfield Empowerment Zone

Posted by Christopher Geehern on Apr 9, 2018 9:08:15 AM

A model collaboration among the City of Springfield, Springfield Public Schools, the Springfield Education Association, teachers, administrators, local philanthropy, and the commonwealth to turn around 11 middle and high schools in Springfield will receive the 2018 John Gould Education and Workforce Development Award, AIM announced today.

Gould2018Now in its third year and serving more than 5,000 middle and high school students, the Springfield Empowerment Zone Partnership represents a groundbreaking initiative in which individual schools operate with autonomy over hiring, budget, schedule, curriculum, and culture.

Schools in the Zone are overseen by an independent board made up of majority community leaders. It remains part of the district and is accountable to the district and the state under a performance contract.

AIM will present the Gould Award at its Annual Meeting on May 18 at the Westin Waterfront hotel in Boston. Lt. Governor Karyn Polito will keynote the event, which will also include presentation of AIM Vision Awards to philanthropists Bill and Joyce Cummings and the financial services company MassMutual.

“The Springfield Empowerment Zone Partnership is an example of what can happen when teachers and administrators are provided with the freedom and accountability to make schools better for students,” said Richard C. Lord, President and Chief Executive Officer of AIM.

“AIM is pleased to honor a project that brings together city and district leaders, the local teachers union, the school committee, the commonwealth, educators, parents and students in a key economic area of Massachusetts.”

The Springfield Empowerment Zone has generated bipartisan support on both the state and local levels. Governor Charlie Baker highlighted the initiative in his State of the State speech in January.

“These zones…allow educators to make the changes to provide a better learning environment for our kids,” Baker said.

Meanwhile, State Senator Eric Lesser, a Democrat whose district includes parts of Springfield, said “Springfield has been able to avoid a state takeover and create a model for getting everyone talking to each other and all the stakeholders working collaboratively.”

The Board of Directors that oversees the Empowerment Zone is chaired by Chris Gabrieli, chief executive of the education nonprofit Empower Schools. The board also includes Mayor Sarno, School Superintendent Dan Warwick, School Committee Vice Chair Chris Collins, and prominent community members John Davis, Senior Trustee at the Davis Foundation; Beverly Holmes, a former MassMutual executive and now active church pastor; and James Morton, President and CEO of the YMCA of Greater Boston.

The Springfield Education Association, the union representing teachers in the city, negotiated a separate agreement for educators at schools included in the Empowerment Zone.  Union and Zone leaders maintain an active partnership in their efforts to improve education and create collaborative environments within Zone schools. 

Local and state officials and educators caution that it is too early to declare success, but they are encouraged by improving test results and collaborative alignment among district leadership, unions, school committee members, educators, school leaders, and more.

Superintendent Warwick reflected on the progress of the Zone saying “what I see going on in the schools – the energy, the excitement, the buy-in from students – you can already see these schools have improved and they’re going to continue to improve because of the structures that are being put in place”.

The Gould Award was established in 1998 to recognize the contributions of individuals, employers, and institutions to the quality of public education and to the advancement, employability, and productivity of residents of the Commonwealth.

In 2000, the award was named after John Gould, upon his retirement as President and CEO of AIM, to recognize his work to improve the quality of public education and workforce training in Massachusetts.

Past recipients of the Gould Award include; the late Jack Rennie, Chairman and Founder of the Massachusetts Business Alliance for Education, Middlesex Community College, Gordon Lankton, President and CEO (retired), NYPRO Inc., William Edgerly, Chairman Emeritus, State Street Corporation, Northeastern University, The Davis Family Foundation, Intel Massachusetts, EMC Corporation, IBM, David Driscoll Commissioner (Retired) Massachusetts Department of Education, State Street Corporation and Year UP Boston, Beth Israel Deaconess Medical Center, Massachusetts Manufacturing Extension Partnership, Brockton High School, Manufacturing Advancement Center – MACWIC Program, Christo Rey Boston High School, CVS and Massachusetts Rehabilitation Commission and Morgan Memorial Goodwill Industries. 

Register for the AIM Annual Meeting 

 

Topics: AIM Annual Meeting, Education, Gould Education and Workforce Training

Tariff Announcements Drive Down Business Confidence

Posted by Christopher Geehern on Apr 3, 2018 8:28:21 AM

Confidence among Massachusetts employers weakened during March amid roiling international trade tensions and volatile financial markets.

BCI.March.2018The Associated Industries of Massachusetts Business Confidence Index (BCI) declined a point to 63.5, retreating from a 17-year high in February. The BCI has gained 1.1 points during the past 12 months and remains comfortably within the optimistic range.

But virtually every element of the March confidence survey lost ground, led by a 1.7-point drop in the US Index of national business conditions. Several employers blamed the Trump Administration’s decision to level tariffs on steel, aluminum and other products for their uncertain outlook.

“Tariffs on stainless steel and aluminum will negatively impact our bottom line in the short run and could prevent our customers from providing new projects due to increased costs,” wrote one employer.

Raymond G. Torto, Chair of AIM's Board of Economic Advisors (BEA) and Lecturer, Harvard Graduate School of Design, said the steel and aluminum tariffs raise the prospect of retaliation by other nations against products made by Massachusetts companies.

“Trade wars reduce the competitiveness of Massachusetts companies and increase costs for consumers. Announcement of the tariffs sent financial markets into a tailspin last month and some of that uncertainty rubbed off on employers,” said Torto.

Cranberries, for example, a key Massachusetts agricultural export, were among the products targeted for retaliation by the European Union before the administration exempted that region from the steel and aluminum tariffs. Massachusetts companies exported $27.5 billion worth of products to foreign markets during 2017, with the largest share (13.5 percent) going to Canada.

The AIM Index, based on a survey of Massachusetts employers, has appeared monthly since July 1991. It is calculated on a 100-point scale, with 50 as neutral; a reading above 50 is positive, while below 50 is negative. The Index reached its historic high of 68.5 on two occasions in 1997-98, and its all-time low of 33.3 in February 2009.

The Index has remained above 50 since October 2013.

Constituent Indicators

The constituent indicators that make up the overall Business Confidence Index were mostly lower during March.
The decline in the US Index was matched by a 1.6-point decline in the Massachusetts Index assessing business conditions within the commonwealth. The Massachusetts Index stood at 66.9, leaving it 3.2 points higher than in March 2017.

The U.S. Index ended the month at 65.2, 5.3 points better than a year ago. March marked the 97th consecutive month in which employers have been more optimistic about the Massachusetts economy than the national economy.

The Current Index, which assesses overall business conditions at the time of the survey, lost 1.5 points to 62.6. The Future Index, measuring expectations for six months out, declined 0.6 points to 64.4. The Current Index has risen 0.8 points and the Future Index 1.4 points during the past 12 months.

Operational Views

The only element to gain ground was the Employment Index, which rose 0.9 points for the month but remained 1.7 points behind its level of a year ago. The Company Index, meanwhile, reflecting employer views of their own operations and prospects, was off 0.7 points to 61.7.

Manufacturing companies (65.4) were more optimistic than non-manufacturers (61.3). Large employers (68.8) were more bullish than medium-sized (60.3) or small businesses (65.2).

“There is no question that the whirlwind of events taking place in Washington, from the tax bill to trade sanctions, are affecting the outlook of Massachusetts employers,” said Barry Bluestone, Professor of Political Economy at Northeastern University, and a BEA member.

“But it’s also worth noting that the only two elements of the BCI that have declined during the past year are the Company Index and the Employment Index, two measures tied to the performance of individual companies. Overall confident remains strong, but those elements will be worth watching.”

Trade Battles

AIM President and CEO Richard C. Lord, also BEA member, said the announcement of tariffs and subsequent modifications of those tariffs by the administration has generated uncertainty among employers.

“Trade barriers are cause for concern in a state that exported more than $27 billion worth of goods in 2017,” Lord said.

“AIM and its member employers continue to believe that free trade and open markets remain the best way to ensure growth in the global economy.”

Topics: International Trade, AIM Business Confidence Index, Massachusetts economy

AIM Honors Bill and Joyce Cummings, MassMutual with 2018 Vision Awards

Posted by Christopher Geehern on Apr 2, 2018 9:16:17 AM

A couple giving away its fortune to charity and a distinguished financial services company adding jobs from Springfield to Boston will be honored with 2018 Vision Awards from Associated Industries of Massachusetts (AIM).

AIM will honor Bill and Joyce Cummings and Cummings Foundation of Woburn and MassMutual of Springfield at the association’s Annual Meeting on May 18 in Boston.

Bill Cummings, the founder of Woburn-based Cummings Properties, and his wife Joyce are among the most prolific philanthropists in Massachusetts, donating more than $21 million each year to organizations working in human services, education, healthcare, and social justice. The Cummings are also signatories to the Giving Pledge, the organization founded in 2010 by billionaires Warren Buffett and Bill and Melinda Gates to encourage people to donate their wealth to philanthropic causes or charities.

MassMutual, a cornerstone of the western Massachusetts economy since its founding in 1851, recently announced plans to move 1,000 workers into a new $240 million office in the Seaport District of Boston and another 1,500 new workers to its headquarters in Springfield. The company said the move is part of a broader strategy to consolidate operations in its home state and give the company increased access to a growing pool of tech and financial industry workers.

The AIM Vision Award recognizes companies, organizations and individuals who have made unique contributions to the cause of economic opportunity in Massachusetts. The award reflects AIM’s mission to stand for jobs, economic prosperity, innovation and a government that acknowledges that the private sector has the unique responsibility to create the common wealth for the people of Massachusetts.

“The 4,000 member-employers of Associated Industries of Massachusetts are delighted to honor two people and one company who illustrate and define the value that free enterprise brings to the larger society,” said Richard C. Lord, President and Chief Executive Officer of AIM.

“Bill and Joyce Cummings set the standard for philanthropy in Massachusetts and have built the idea of giving back into the DNA of their business. MassMutual is a 167-year-old company that continues to grow and create significant economic opportunity for the citizens of Massachusetts.”

Bill and Joyce Cummings

CummingsThe Cummings donate millions to charity each year through several programs of Cummings Foundation:

  • $100k for 100 – A grant program that funds small and medium-sized Massachusetts nonprofits in Middlesex, Essex, and Suffolk counties. Each year, hundreds of organizations vie for invitations to apply for one of the 100 grants of $100,000 each to be awarded locally.
  • Sustaining Grants - Recognizing nonprofits' need for long-term financial support, $10 million in Sustaining Grants go annually to former $100K for 100 winners whose grants are now in their final year.
  • Institute for World Justice – Uses education to help prevent future genocides and other intercultural violence and injustices; and aids in the recovery and rebuilding of Rwanda. The Foundation pledged the first $15 million toward the planning and creation of the first phase of  University of Global Health Equity in Butaro, Rwanda
  • Tufts University Cummings School of Veterinary Medicine – The Foundation maintains a long-standing partnership with New England’s only veterinary school—providing support and financial resources to sustain the graduate school’s global reputation for excellence. The partnership includes a $70 million commitment from the Foundation, the majority of which has been fulfilled.

Bill Cummings says he learned both the value of hard work and the importance of generosity from his parents. His father painted houses, raising a family in a one-bedroom apartment atop a liquor store and a taxi stand on the outskirts of Boston. His mother was a neighborhood fixture, building friendships as she knocked on doors to collect coins for large charities that once operated that way.

He spent part of his young years washing windows for his neighborhood’s storekeepers, and for three summers as a young teen he sold ice cream from the back of his bike at a nearby Ford Motors assembly plant. Later he purchased and sold dozens of small boats using Boston Globe classified ads. Eventually, he grew Cummings Properties into a 500-person company with a debt-free portfolio of 11 million square feet of commercial real estate.

“My friend Bill writes that he rejects the phrase ‘give until it hurts’ because he and his wife, Joyce, think the better advice is to ‘give until it feels good.’ It’s a fitting observation from a man whose extraordinary business success is outmatched only by his commitment to lifting up those around him,” said Melinda Gates, Co-Chair of the Bill and Melinda Gates Foundation.

MassMutual

MassMutual.FINALMassMutual is a leading mutual life insurance company that offers a wide range of financial products and services, including life insurance, disability income insurance, long-term care insurance, annuities, retirement plans and other employee benefits.

The company is one of the largest businesses based in Massachusetts, with $771 billion in assets under management and $670 billion of life insurance protection in force (as of year-end 2017).

MassMutual employs some 3,000 people in Springfield and approximately 7,300 people globally.

The company reached number 77 on the FORTUNE® 500 list in 2017 and was named a FORTUNE Most Admired company for 2018 (a distinction held for the last 18 out of 20 years), topping the list for innovation and the top-ranked mutual company in the life and health insurance industry category. 

MassMutual was also recognized as one of the 2018 World’s Most Ethical Companies for the fifth consecutive year by the Ethisphere Institute. The company was featured on the Human Rights Campaign’s Corporate Equality Index for the eighth time in the last decade in 2018, earning a perfect score of 100.

Perhaps no company has done more for Springfield and western Massachusetts over a longer period of time while forging more far-reaching business success than MassMutual. From its recent $1 million commitment to expand a support program that addresses students’ out-of-school challenges to promoting inclusive entrepreneurship through a partnership with Valley Venture Mentors, MassMutual has provided a compelling model for companies seeking to balance the demands of a global marketplace with the needs of its hometown.

In addition to strengthening education in Springfield, through the MassMutual Foundation, the company invests in projects, programs and organizations focused on strengthening the city of Springfield through revitalization, development, and social capital.  Signature investments in the region include $15 million of support over 10 years to the University of Massachusetts Amherst to drive education and economic opportunity in western Massachusetts, $1 million to the Naismith Memorial Basketball Hall of Fame’s Capital Campaign to revitalize the Museum, and seasonally supporting the Springfield Museums.

The sustained commitment of MassMutual is even more extraordinary because it has come in an age when most of the other large companies that once also shouldered the responsibility for philanthropy and economic development in the city have long since disappeared or been absorbed into other entities.

In announcing its expansion in Springfield and Boston, MassMutual Chairman, President and CEO Roger Crandall said, "Following a thorough strategic assessment of our operations and footprint, we concluded that our home state of Massachusetts is the best place for us to grow and thrive over the long term. We have deep roots and a supportive community in our hometown of Springfield, and we will continue to invest and grow our workforce in the city."

MassMutual has been honored regularly among the best places to work for both working mothers and for lesbian, gay, bisexual and transgender employees.

Register for the AIM Annual Meeting

 

Topics: AIM Annual Meeting, AIM Vision Awards

Employers to Save $150 Million on Workers' Compensation

Posted by Christopher Geehern on Mar 23, 2018 4:42:08 PM

Massachusetts employers will see a $150 million decrease in workers’ compensation insurance rates beginning July 1 under an agreement between state regulators and the insurance industry.

ManufacturingWorkerSmall.jpgAttorney General Maura Healey, the State Rating Bureau and the Workers' Compensation Rating and Inspection Bureau, which represents insurers, agreed this week to a 12.9 percent rate decrease for policies written after July 1. Insurance companies had initially filed for an 11.1 percent rate reduction.

Massachusetts employers must purchase workers' compensation insurance, and rates are re-set at least every other year.

“This is certainly good news for employers. The 1991 workers compensation reform led by Associated Industries of Massachusetts is still paying dividends,” said Richard C. Lord, President and Chief Executive Officer of AIM.

Workers’ compensation rates have declined more than 60 percent since the 1991 reform.

Healey said in a statement, "When we lower the rates for workers' compensation insurance, we protect workers and allow businesses to invest in higher wages and growth."

AIM sponsors A.I.M. Mutual Insurance Company, one of the largest writers of workers compensation coverage in Massachusetts. Michael Standing, Chief Executive Officer of A.I.M. Mutual, thanked state regulators for an efficient rate-setting process.

Topics: Workers Compensation, A.I.M. Mutual Insurance Company, Workers Compensation Insurance

Economic Development Chief Staying Busy

Posted by Christopher Geehern on Mar 23, 2018 12:22:16 PM

Jay Ash acknowledges that it’s a great time to be Secretary of Housing and Economic Development in Massachusetts.

Ash.jpg“I am getting a call a week from a company talking to me, not about bringing 100 or 200 or 500 jobs, but 1,000, 5,000 or 10,000 jobs,” Ash told 300 business leaders during a presentation to the AIM Executive Forum this morning.

Ash has recently played a key role in the recruitment or expansion in Massachusetts of major employers ranging from Amazon, General Electric and MassMutual to IBM Watson Health, Kronos and Siemens. These expansions promise thousands of high-quality new jobs for Massachusetts residents while cementing the state’s reputation as a global center of innovation and growth.

“What an unbelievable time to be involved in economic development, and what an unbelievable time to be involved in a great state like Massachusetts,” he said.

Ash, an avuncular Democrat who has overseen economic development for the Baker Administration during its first three years, said Massachusetts benefits from a uniquely bipartisan approach to issues affecting the economy. He noted that the economic development bill announced by the Republican governor just two weeks ago has already been scheduled for a hearing Tuesday by the Democratically controlled Legislature.

The bill would commit $100 million to regionally significant economic development projects throughout the commonwealth, establish an apprenticeship tax credit, double grants to community colleges and vocations high schools to purchase equipment and establish a permanent sales-tax holiday.

Ash said the administration is pursuing its economic agenda in tandem with efforts to expand the availability of housing and to address persistent educational achievement and funding gaps. He thanked Associated Industries of Massachusetts for efforts to streamline the process used by communities to permit both low-income and market-rate housing.

 “There’s reason to be optimistic. Let’s roll up our sleeves because the best jobs done are the one we do ourselves.

Topics: Economic Development, Economy, AIM Executive Forum

Employer Confidence Strengthens, Despite Market Volatility

Posted by Christopher Geehern on Mar 6, 2018 7:40:45 AM

Massachusetts employer confidence strengthened during February as optimism about long-term economic growth outweighed a volatile month in the financial markets.

BCI.February.2018.jpgThe Associated Industries of Massachusetts Business Confidence Index (BCI) rose 0.4 points to 64.5, setting another 17-year high. The BCI has gained 2.4 points during the past 12 months as confidence levels have remained comfortably within the optimistic range.

Enthusiasm about the U.S. and Massachusetts economies, along with a bullish outlook on the part of manufacturers, fueled the February increase.

At the same time, hiring remained a red flag as the BCI Employment Index fell 4 points between February 2017 and February 2018. Almost 90 percent of employers who responded to the February confidence survey indicated that the inability to find skilled employees is either a modest, large or huge problem.

“Fourteen percent of respondents said finding employees represents a huge problem that is hampering their company’s growth. One-third of employers see employee recruitment as a big problem, while 29 percent see it as a modest issue,” said Raymond G. Torto, Chair of AIM's Board of Economic Advisors (BEA) and Lecturer, Harvard Graduate School of Design.

“For the short-term, however, the state and national economies remain strong and the recent announcement by Amazon of a major expansion in Boston indicates that the trend should continue.”

The survey was taken before President Donald Trump roiled the financial markets last week by pledging to impose stiff tariffs on steel and aluminum imports.

The AIM Index, based on a survey of Massachusetts employers, has appeared monthly since July 1991. It is calculated on a 100-point scale, with 50 as neutral; a reading above 50 is positive, while below 50 is negative. The Index reached its historic high of 68.5 on two occasions in 1997-98, and its all-time low of 33.3 in February 2009.

The Index has remained above 50 since October 2013.

Constituent Indicators

The constituent indicators that make up the overall Business Confidence Index were mixed during February.

The most significant gains came in the Manufacturing Index, which surged 3.9 points to 66.2, and the US Index, which rose 2.1 points for the month to 66.9 and 8.0 points for the year. The Massachusetts Index fell 0.4 points to 68.5, but was up 5.3 points for the year and still higher than the national outlook for the 96th consecutive month.

The Current Index, which assesses overall business conditions at the time of the survey, rose 2.4 points to 64.1.

The Future Index, measuring expectations for six months out, declined 1.6 points to 65. The Current Index has risen 4.2 points and the Future Index 0.6 points during the past 12 months.
Operational Views

The Company Index, reflecting employer views of their own operations and prospects, was essentially flat, gaining 0.1 points to 62.4. The Employment Index also rose 0.1 points, to 56.4, versus 60.4 in February 2017.

Manufacturing companies (66.2) were more optimistic than non-manufacturers (61.9). Large employers (69.8) were more bullish than medium-sized (62.0) or small businesses (62.7).

“The special February BCI question about the ability of employers to find and hire skilled employees confirms our concerns about the long-term changes now facing the Massachusetts labor market,” said Alan Clayton-Matthews, Ph.D., School of Public Policy & Urban Affairs, Northeastern University, and a BEA member.

“Since the end of the Great Recession, total employment has grown by 355,600, the working age population has increased by 326,700, and the labor force has grown by 208,100. In other words, employment in Massachusetts has grown considerably faster than the working age population, and almost twice as fast as the labor force.” 

AIM President and CEO Richard C. Lord, also BEA member, said member employers expressed broad optimism about the national economy in the wake of tax reform, but remain uncertain about Massachusetts given the prospect of ballot questions that would impose an income tax surcharge, mandate paid family leave and increase the minimum wage to $15 per hour.

“Massachusetts employers have been more bullish about the state economy than the national economy for 96 consecutive months, but the numbers are now very close – 68.5 for Massachusetts and 66.9 for the nation,” Lord said.

“Economic competitiveness is a constant struggle. AIM looks forward to working with the Legislature and Governor Baker during the next several months to ensure that Massachusetts companies are able to grow and prosper here.”

Topics: Skills Gap, AIM Business Confidence Index, Massachusetts economy

Lack of Natural-Gas Infrastructure Puts Massachusetts at Risk

Posted by Christopher Geehern on Mar 5, 2018 11:07:11 AM

Employers in Massachusetts pay some of the highest electricity rates in the country, in part because the commonwealth lacks adequate infrastructure to bring natural gas from other regions of the country. AIM Senior Vice President of Government Affairs Robert Rio last week debated the natural-gas issue on Commonwealth magazine's Codcast with Elizabeth Turnbull Henry, President of the Environmental League of Massachusetts.

Commonwealth.Codcast.jpg

Topics: Environment, Energy, Business Costs

Employers Begin 2018 on Confident Note

Posted by Christopher Geehern on Feb 6, 2018 8:06:35 AM

Massachusetts employers began 2018 much the way they ended 2017 – with growing confidence in the economy and optimism about their own business prospects.

BCI.January.2018.jpgThe Associated Industries of Massachusetts Business Confidence Index (BCI) rose half a point to 64.1 during January, setting another 17-year high. The BCI has gained 2.7 points during the past 12 months as employer confidence levels have remained comfortably within the optimistic range.

Growing enthusiasm about the Massachusetts economy and a brightening outlook on economic conditions six months from now fueled the January confidence increase. At the same time, the hiring outlook remained muted as low unemployment and demographic shifts continued to impede the ability of employers to find the workers they need.

The survey was taken prior to major declines in global financial markets during the past several days.

“Rising confidence is not surprising in a state with 3.5 percent unemployment and an economy that grew at a 3.3 percent annual rate during the fourth quarter,” said Raymond G. Torto, Chair of AIM's Board of Economic Advisors (BEA) and Lecturer, Harvard Graduate School of Design.

“Economic output, job growth and spending all rose at a healthy clip in Massachusetts during the final three months of the year and economists expect modest growth to continue during the first half of 2018.”

The AIM Index, based on a survey of Massachusetts employers, has appeared monthly since July 1991. It is calculated on a 100-point scale, with 50 as neutral; a reading above 50 is positive, while below 50 is negative. The Index reached its historic high of 68.5 on two occasions in 1997-98, and its all-time low of 33.3 in February 2009.

The Index has remained above 50 since October 2013.

Constituent Indicators  

The constituent indicators that make up the overall Business Confidence Index were mixed during January.

The most significant gain came in the Massachusetts Index assessing business conditions within the commonwealth, which rose 1.3 points to 68.9. The Massachusetts Index has gained 3.7 points in the past two months, 5.5 points year over year and now stands at its highest level since November 2000.

The U.S. Index of national business conditions also continued a yearlong rally by gaining 0.6 points to 64.8. January marked the 95th consecutive month in which employers have been more optimistic about the Massachusetts economy than the national economy.

The Current Index, which assesses overall business conditions at the time of the survey, decreased a point to 61.7 while the Future Index, measuring expectations for six months out, surged 2.1 points to 66.6. The Current Index has risen 2.1 points and the Future Index 3.3 points during the past 12 months.

Operational Views

The Company Index, reflecting employer views of their own operations and prospects, rose slightly, gaining 0.2 points to 62.3. The Employment Index was essentially flat, leaving it 2.1 points below its level of January 2017.

Non-manufacturing companies (66.6) were more optimistic than manufacturers (62.3). Large employers (67.2) were more bullish than medium-sized (62.7) or small businesses (63.5).

“The strong Future Index readings signal that employers anticipate steady growth during the first two quarters of 2018. The only fly in ointment remains the prospect that labor shortages may constrict the ability of companies to grow and expand,” said Paul Bolger, President, Massachusetts Capital Resource Company and a BEA member.

Political Risks

AIM President and CEO Richard C. Lord, also BEA member, said 2018 brings with it significant risk for employers as progressive groups push ballot questions that could create a $1 billion paid family and medical leave program, impose a punitive tax on many small businesses and raise the state minimum wage to $15 per hour.

“The Massachusetts Supreme Judicial Court will today hear arguments in a challenge that I and four other business leaders filed to the constitutionality of the income surtax question. Meanwhile, the business community is seeking common ground on a compromise paid-leave proposal that will not harm the economy,” Lord said.

Topics: AIM Business Confidence Index, Massachusetts economy, Massachusetts employers

Video Blog: How Will Automation and Robotics Affect the Economy?

Posted by Christopher Geehern on Feb 5, 2018 8:30:00 AM

How will artificial intelligence, automation and robotics affect the Massachusetts economy? The Associated Industries of Massachusetts Economic Outlook Forum tackled that question on January 26. Expert analysts included, left to right, moderator Jeff Brown, Business Editor of WBZ radio in Boston; Peter Russo Director of Growth and Innovation at the Massachusetts Manufacturing Extension Parntership; Martha Sullivan, President and CEO of Sensata Technologies in Attleboro; and David Askey, Co-Founder and CEO of Ascend Robotics in Cambridge.

Topics: Technology, AIM Executive Forum, robotics

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