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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

AIM President: Technology Key to Solving Worker Shortage

Posted by Christopher Geehern on Jan 26, 2018 1:14:00 PM

Robotics, artificial intelligence and automation hold the unique promise of resolving the shortage of skilled workers that threatens the economic future of Massachusetts, AIM President and Chief Executive Officer Richard C. Lord said this morning.

Lord.Speaking.jpgDelivering the fourth annual State of Massachusetts Business address before 300 senior business executives, Lord acknowledged that automation suffers from a grim image problem in the larger society where people fear that robots will take their jobs. But he said Massachusetts employers starved for qualified employees are using robots in collaboration with people to extend the reach of their work forces.

“In a state where employers created 70,000 jobs last year and unemployment stands at 3.6 percent, the structural shortage of skilled workers stands as the primary impediment to sustained economic growth,” Lord told the 2018 AIM Economic Outlook Forum.

“Massachusetts companies across industries ranging from software to manufacturing to hospitality have postponed expansions, declined to bid for contracts or outsourced work because they simply can’t find people with the training needed to compete in a complex world. The only way out of this economic dead end for Massachusetts is to rely upon productivity improvements fueled by intelligent technology to extend the reach of the talented people we employ.”

Lord highlighted the example of Barrett Distribution of Franklin, which is using robots to improve productivity and reduce the amount of time its 500 employees spend moving throughout large warehouses to provide orders for retailers and e-commerce customers. Established as a single warehouse in 1941, Barrett now operates more than 2.1 million square feet of state-of-the-art warehouse space across the country.

“The industry is changing very fast, the robots will get smaller, more adaptive, (and) a little bit cheaper, so I think you’ll see the adoption rate go up very high across the industry. And certainly for us, we’re going to be on the leading edge of this technology,” Scott Hothem, Senior Vice President of Customer Solutions at Barrett, said in a video shown the audience.

Lord said the good news is that Massachusetts is a global center of robotics, AI and automation. Driven by academic research institutions like MIT, Harvard, UMass and BU, Massachusetts occupies a unique position as the crucible of intelligent industries ranging from driverless vehicles to Patriot missiles to Roomba vacuum cleaners.

It’s also worth noting, according to Lord, that there is plenty of room for improvement on the productivity front. The United States posted an historically low annual labor productivity growth rate of 1.1 percent between the great Recession and 2016. The McKinsey Global Institute estimates that automation could raise productivity growth globally by 0.8 to 1.4 percent each year.

A panel of experts largely agreed with the idea that automation will enhance, rather than replace, most human labor.

David Askey, founder of Ascend Robotics in Cambridge, said the manufacturing companies that use his technology have realized productivity increases approaching 40 percent that have also raised the compensation and value of workers.

“Most of our calls come from customers who are not able to find enough skilled workers or want to expand,” Askey said.

Martha Sullivan, President and CEO of Sensata Technologies of Attleboro, said that while the technology for mass use of autonomous vehicles remains several years away, it is a technology that could change the entire business model of the auto industry from one that sells vehicles to consumers to one that helps companies manage fleets.

“Will you have private ownership anymore? Will you need private automobile insurance? … It becomes an asset- management question,” she said.

Lord said employers acknowledge the need to engage in debate about the hard issues raised by the technological revolution: Does automation ultimately create or cost jobs? Do Amazon and similarly disruptive companies ultimately help or harm the economy? And are technology driven productivity increases to blame for the slow rate of wage growth eight years into an economic recovery?

“But the ultimate truth is this – technology and innovation are here to stay; they do not regress, they do not go away and they do not waiver from the relentless pursuit of removing inefficiencies from the business economy.,” Lord said.

“If large numbers of workers are not going to walk through the doors of our companies to write code or make jet engine parts, employers will have to find ways to do more with less.”

Topics: Massachusetts economy, AIM Executive Forum

DraftKings CEO Sees Bright Future

Posted by Christopher Geehern on Nov 17, 2017 11:33:48 AM

The worlds of sports, media and gaming are likely to coalesce during the next several years and the co-founder and chief executive of Boston-based DraftKings believes his company and its 8 million customers will be a major player in that new world.

Robins.jpgJason Robins, who built DraftKings into a $1.5 billion fantasy sports colossus in just five years, told 250 business executives at the AIM Executive Forum this morning that companies like his have raised interest in professional sports and given fans an entirely new experience of watching everything from NFL Football to major league soccer

“A lot of exciting things on the horizon,” he said during a 45-minute conversation with AIM President Richard Lord.

"What technology and mobile have done for gaming and media, it's incredible, and we've only sort of reached the tip of the iceberg. I think you're going to see a convergence of media and gaming.

"I also think this sort of media landscape where all the content is scattered around different places and you have to have a bunch of different services or you have to sort through 800 cable channels to find what you're looking for, it's not necessary anymore."

Daily Fantasy Sports (DFS) allows fans to enter daily and weekly fantasy sports contests and win prizes based on individual players’ performances. Industry researchers estimate that players spent an estimated $3.26 billion on daily fantasy sports in 2016.

Robins said DraftKings surpassed more established competitors to became the pre-eminent DFS company “because we had a better mousetrap.” The keys to that mousetrap, he said, were products, technology and analytics that created a “game within a game” for sports fans.

What Robins and his partners did not anticipate in 2012 was the intense level of regulatory scrutiny that DraftKings and other DFS companies would engender both in Massachusetts and across the country.

DraftKings has supported consumer-protection regulations for the fantasy industry implemented by Massachusetts Attorney General Maura Healey in 2016 covering issues such as excluding minors, ensuring “fair” gameplay, prohibiting contests on college sports, and spelling out standard marketing practices. Robins said those regulations, though not perfect, have become the basis for DFS legislation in more than a dozen other states.

The company is less enthusiastic about a commission report several months ago that recommended that the Massachusetts Legislature enact a law that would label DFS as gambling and give the Massachusetts Gaming Commission oversight over the industry.

“I will continue to work with them on the way they have gone about their analysis,” Robins said.

He believes the future is a bright one for DraftKings in large measure because of its customer demographics. DraftKings, he said, have the customers everyone wants – millennials in higher income brackets who do not hesitate to spend money on entertainment.

"What we've tried to do is position ourselves as a platform, partner with companies that own these types of rights, and say, look, we can help you in the world where you're trying to grow your subscriptions, your direct-to-consumer business," Robins said.

"We have the customers you want, we know exactly what they're interested in and we have the data to target them."

Topics: Technology, AIM Executive Forum

Speaker Calls for Employer Policy Engagement

Posted by Christopher Geehern on Sep 15, 2017 11:33:00 AM

The first time Robert DeLeo spoke to the Associated Industries of Massachusetts after being elected Speaker of the Massachusetts House of Representatives in 2009, unemployment was 8.8 percent.

The new speaker drove to the AIM speech past empty buildings along Route 128. Traffic was minimal. Consumer and business confidence was at a nadir in the wake of the financial crisis and Great Recession.

Speaker DeLeo reminisced about that first speech this morning as he returned to address more than 300 business leaders at the AIM Executive Forum. He noted that unemployment now stands at 4.2 percent and that Massachusetts employers added 11,000 jobs in August alone. And Boston is on the short list of cities being considered for major development by Amazon just as General Electric settles into its new corporate headquarters.

The speaker attributed the economic resurgence in part to a unique collaboration forged by legislators and the business community to develop pro-business policies and that also benefit the society at large.

“They are not mutually exclusive. One does not detract from the other,” Speaker DeLeo said in a wide-ranging speech during which he thanked AIM and employers for helping to build consensus on issues such as education, wage equity and the Pregnant Workers Fairness Act.

“We are very mindful of the impact that changes might make on our employers, which we always remember are our economic engine,” he said.

The speaker outlined several key priorities as the Legislature heads in the fall, including moderating the cost of health insurance and monitoring what has become a persistent sluggishness in state tax revenues.  That sluggishness is affecting states throughout the country, despite the overall healthy economy.

“We obviously haven’t seen the revenue growth we have seen in past economic recoveries,” Mr. DeLeo said.

The speaker expressed optimism in the wake of a recent report that health-care costs in Massachusetts increased at a moderate 2.8 percent in 2016, well below the growth benchmark established by the 2012 health-cost control law. Such stability is essential at a time when federal health-care policy remains in flux.

“We have been successful in driving down health-care spending growth, even in a difficult and unpredictable environment,” he told the crowd.

“We appreciate willingness of business community to work with us and nd their patience on how to move forward.”

Topics: Massachusetts Legislature, House Speaker Robert DeLeo, AIM Executive Forum

Uber Envisions New Transportation Model

Posted by Christopher Geehern on Mar 30, 2017 4:16:43 PM

The ride-sharing app Uber has logged the fastest ascent in Silicon Valley history, growing from a startup eight years ago to a company operating across 450 cities in 73 countries and serving 40 million customers each month.

But the company’s Boston-based regional manager, Meghan Verena Joyce, said the company’s ultimate objective is much larger - to merge traditional transportation infrastructure with new technology to create a new model of moving from one place to another.

“I often wonder whether my daughter will ever have a driver’s license,” Joyce mused as she spoke to 300 people at the AIM Executive Forum in Waltham this morning.

The new transportation model, Joyce said, will make efficient use of private automobiles and public transit to reduce traffic congestion, greenhouse gas emissions and land-intensive parking. It will create a system in which everyone – including people in low-income urban areas often left out of the transit grid – will have access to reliable and affordable transportation.

“We believe there is a better way,” said Joyce, a Harvard MBA who served as an associate at Bain Capital and as a senior policy advisor at the US Treasury before joining Uber in 2013.

The challenge is not the one billion automobiles that exist worldwide, according to Joyce, but the solitary manner in which we use them. A show of hands from the audience indicated that the vast majority of people had driven to the Executive Forum with only one person in the vehicle.

Joyce said that Uber has already taken steps to integrate technology with existing transportation infrastructure to streamline the system. Many Uber customers in Boston combine ride-sharing with the MBTA, while others use a modified car-pooling initiative called UberPOOL to share rides with neighbors who travel to the same locations at similar times.

Almost one-third of Uber trips in Great Boston come from UberPOOL, according to Joyce. In San Francisco, where UberPOOL has existed for a longer time, the program has reduced car traffic in that city and saved an estimated 6.2 million gallons of gasoline while cutting carbon dioxide emissions by an estimated 55,000 metric tons.

Joyce said Uber’s vision also includes providing transportation options for people in low-income urban areas. People in Dorchester and Mattappan, who she said formerly waited an average of 25 minutes for taxi pickups, now enjoy 96 percent reliability and pickups within 3-5 minutes with ride sharing.

“Our vision is to create a transportation ecosystem that is better for everyone,” she said.

Topics: Associated Industries of Massachusetts, AIM Executive Forum, Transportation

Business Leaders Share Outlook for 2017

Posted by Christopher Geehern on Jan 23, 2017 10:10:11 AM

What lies ahead for Massachusetts employers as a new administration comes to Washington in 2017? Listen as three distinguished business leaders - Robert Reynolds, President and Chief Executive Officer of Putnam Investments in Boston; Donna Cupelo, region president of Verizon in New England; and Lisa Chamberlain, managing partner of The Chamberlain Group in Great Barrington – share their opinions as part of the AIM Economic Outlook Forum. Moderator is Jeff Brown, Business Editor of WBZ Radio in Boston.

Topics: Massachusetts economy, Massachusetts employers, AIM Executive Forum

Politico Editor: 2016 Election Highlights Blue-Collar Concerns

Posted by Christopher Geehern on Sep 16, 2016 2:18:05 PM

Donald Trump has more social-media followers than the number of votes normally needed to be elected president of the United States.


It’s a statistic that Peter Canellos, Managing Editor of Politico, says helps to explain why the media coverage of the 2016 presidential election, and the election itself, is different from any other in history.

“These changes are themselves a major factor in the 2016 presidential campaign,” Canellos told more than 250 business leaders at the AIM Executive Forum this morning.

“We can’t establish the political dialog, as we did in the past, but we cannot ignore it.”

Recalling his work covering the 2002 presidential race when he was often the only reporter present when Bill Clinton and other candidates spoke, Canellos said that every word a candidate says today is recorded on a dozen iPhones, often held by representatives of the opposing campaigns, and posted online before any formal media outlet can post the story.

“Even if a news organization tries to exercise restraint, or tries to make decision about the news, the conversation is already galloping ahead without them,” said Canellos, who spent 26 years at the The Boston Globe before moving to Politico.

He acknowledged that many people were uncomfortable with the degree of control that “media mandarins” from The New York Times and other establishment publications once exerted over the narrative of presidential campaigns. The new reality of social media, he said, has recast the role of reporters to one of monitoring the veracity of campaign statements, tracking the connection between money and politics and looking at some of the issues “that candidates seek to avoid.”

Canellos believes the two major political parties will survive an election with two relatively unpopular nominees, but that each will change significantly.

“If you look at the history of the country the two parties’ positions have shifted dramatically. Who would have thought that the Democrats would be the party of Wall Street now? And the migration of working- class blue-collar voters to the Republican party seems to have accelerated strongly with the Trump nomination.”

The Democrats, according to Canellos, will have to sort out whether their future lies with the insurgent wing represented by Senators Bernie Sanders and Elizabeth Warren, or the establishment block led by Hillary Clinton.

“On the Republican side there will be quite an identity crisis. Even if Trump is elected, there will be questions within the Republican party about who they should be and what they should be,” he said.

Canellos said that early predictions that Democrats would regain control of the U.S. Senate appear to have been premature. Control of the Senate is now “a 50-50 proposition” as senators such as John McCain who trailed badly in the polls during the summer appear to be making up ground.

He believes the long-term legacy of the 2016 presidential election will be a sustained debate over the plight of middle-class workers, especially in traditional manufacturing areas now struggling to find new ways to grow.

“Trump has played   a role in putting that constituency front and center...Even some of the Democratic proposals like free college tuition and retraining through community colleges are responding to that constituency."

Topics: Economy, AIM Executive Forum, Policy

Video Blog | Economic Growth, Health Costs, Talent Development

Posted by Christopher Geehern on Jan 22, 2016 3:02:53 AM

The 2016 Associated Industries of Massachusetts Economic Outlook Forum featured a panel of experts looking at prospects for the Massachusetts economy. The panel, moderated by WBZ radio Business Editor Jeff Brown, included Jay Ash, Secretary of Housing and Economic Development; Martha Sullivan, President and CEO of Sensata Technologies in Attleboro; and Dr. Howard Grant, President and CEO of Lahey Health in Burlington.

 

Topics: Skills Gap, Health Care Costs, Massachusetts economy, AIM Executive Forum

The State of Massachusetts Business

Posted by Christopher Geehern on Jan 20, 2016 1:58:45 PM

Associated industries of Massachusetts President and Chief Executive Officer Richard C. Lord delivered his annual State of Massachusetts Business address on January 15, 2016 to more than 250 business leaders from throughout the commonwealth.

Lord said the decision by General Electric Company to base its headquarters in Boston underscores a coalescing of economic activity in major global cities, a development that simultaneously benefits Massachusetts and challenges leaders to spread the benefits beyond Route 495.

Topics: Massachusetts economy, AIM Executive Forum, Jobs

GE Move Uplifts Economic Outlook Forum

Posted by Christopher Geehern on Jan 15, 2016 11:41:53 AM

The decision by General Electric Company to base its headquarters in Boston underscores a coalescing of economic activity in major global cities, a development that simultaneously benefits Massachusetts and challenges leaders to spread the benefits beyond Route 495.

Panel-1.jpgGE’s blockbuster announcement was topic number one this morning as business and government leaders gathered for the annual Associated Industries of Massachusetts Economic Outlook Forum in Waltham.

AIM President and Chief Executive Officer Richard C. Lord said metropolitan areas like Boston, with its rich array of universities, hospitals and financial resources, enjoys its own economic gravitational pull in a rapidly changing economy. That pull, he said, raises two important questions for Massachusetts.

“First, as anyone who sits in Expressway traffic or waits for the T in January will tell you, rapid growth strains the physical and financial resources of the state and its citizens. And then talk to young people trying to afford housing close to their jobs in a city where the Alston-Brighton triple decker in which Ted Williams once lived now sells for more than $1 million with units that rent at more than $2,000 per month,” Lord told more than 250 people who attended the forum.

“Second, and most important, what happens to the economy outside Boston? How do we as a “common wealth” address the widening imbalance between the economically thriving ‘eds and meds’ economy of Greater Boston and the more traditional economy that dominates the commonwealth from Route 495 to Berkshire County?”

Secretary of Housing and Economic Development Jay Ash compared the importance of GE’s move to the Celtics’ acquisition of all-star forward Kevin Garnett in 2007.

“The Celtics were already a good team, a playoff team, but when Kevin Garnett came, he was a Hall of Famer who put the Celtics over the top,” said Ash, who led the commonwealth’s efforts to land GE and its 800 headquarters and research jobs.

The key to the deal, Ash said, was cohesive approach adopted by Governor Charlie Baker, a Republican, and Boston Mayor Matry Walsh, a Democrat.

“I’ve been in politics all my life and I’ve never seen two leaders working so closely together, let alone leaders from different parties working so closely together,” he said.

Ash made his comments during a panel discussion on prospects for the Massachusetts economy in 2016.

Martha Sullivan, Chief Executive Officer of Sensata Technologies in Attleboro, said developing engineering and other technical talent remains a priority for her century-old company, which makes many of the sensors that are the basis of what GE and others call the “industrial Internet.”

Sullivan said that companies must have a vision that attracts talent.

“You have to have a culture that is welcoming, with a diversity of talent, thought and background,” she said.

Dr. Howard Grant, President and Chief Executive Officer of Lahey Health in Burlington, said the Massachusetts economy is being held back by health-care costs that run 36 percent more than the national average. It doesn’t have to be that way, Grant said, if employers and consumers seek treatment in moderately priced community hospitals where medical outcomes match those of expensive academic medical centers.

“We need to do something about that,” Grant said.

Lord said in his annual State of Massachusetts business address that it’s good to be Massachusetts at the dawn of 2016:

  • The commonwealth is likely to approach full employment this year.
  • Massachusetts employers added almost 68,000 jobs during the first 11 months of 2015.
  • Economic output grew 25 percent faster than the nation as a whole, and per-capita personal income remains the second highest in the United States, 128 percent of the national average.
  • AIM’s widely followed Business Confidence Index remains solidly optimistic, despite a marked slowdown in foreign export markets.
  • Massachusetts posted a record-breaking year for venture capital funding in 2015, with $7.4 billion invested across 531 deals.
  • And Bloomberg just named Massachusetts the most innovative state in the nation.

Topics: Health Care Costs, Massachusetts economy, AIM Executive Forum

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