Already reeling from recent bad news in rankings on national scales when it comes to educational performance and overall tax burden per citizen, Maine received more discouraging news this week when the Maine Jobs Council unveiled the results of a recent study: Maine now ranks among the least productive states in America.
According the study conducted by the Washington, DC-based Porter Development Initiative, Maine ranks 46th in the nation for Gross Domestic Product per worker (and 41st for GDP per capita). While the average national annual salary in 2023 was $67,692, Maine trailed this by over $13,000 at $53,876, the report found.
The problem is not necessarily labor force participation, the report suggests, which in December last year was nearly 60 percent — up slightly from the previous year. Instead, these issues seem more connected to the state’s economic environment.
Among the reasons cited by the report for Maine’s lagging productivity are higher cost burdens, a mismatch between employer needs and skills available in the labor market, rising cost of living relative to incomes, lower access to capital, low innovation and scant research and development capacity.
None of this should be startling to those who have been tracking Maine’s beleaguered business environment. Last summer, as news broke that Maine then ranked the ninth worst state in America for doing business, Maine Jobs Council Executive Director Joe Edwards said:
“Workforce also remained an important category, and our ranking plunged from 22 to 46. Workforce, productivity, investment, taxes and infrastructure are all categories that impact prosperity, growth, employment and quality of life. Maine is in a very select group of states that score poorly in all of these categories.”
That statement preceded the implementation of yet another new tax on employers, the state’s Family Leave and Medical Program, which went into effect this January. So while Porter Development Initiative appears to have been based on 2023 data sets, more recent ones could drag Maine even further towards the absolute back of the pack.
What Maine needs, the external consultants suggest, is an economic policy that better positions Maine to compete in both domestic and global markets.
“A critical first step is for us to set aside our differences and work together to do whatever it takes for Maine to compete successfully for talent, jobs and investment,” Edwards said of the report.
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