Competitiveness

Is Maine Poised to Compete for Economic Success?

New Study Ranks Maine Poorly for Competitiveness: Job Growth, Business Starts, Workers Productivity, Investment and Innovation Among Lowest in Nation

Maine is behind other states in critical areas like job growth, business creation, worker productivity, and innovation. According to the Maine Competitiveness Assessment—commissioned by the Maine Jobs Council and conducted by Porter Development Initiative Consulting (PDI)—the state lacks a cohesive strategy to compete in the global economy.

Why It Matters

Economics, like sports, is about competition. States compete for talent, investment, and jobs, and new research from experts from Harvard Business School shows that Maine ranks near the bottom in all of those categories as well as business growth and worker productivity. We need to get past our differences and develop a comprehensive strategy to attract talent, young people, and investment so our children and grandchildren can thrive.

“This should be a wake-up call. Maine needs to compete for jobs, investment, and people—or risk being left behind.”

— Joe Edwards, Executive Director, Maine Jobs Council

Key Findings from the Study

The report, grounded in economic theory from Harvard Business School’s Institute for Strategy and Competitiveness, utilizes PDI’s proprietary “Diamond Model” to assess Maine’s business environment and cluster development potential.

Some of the most pressing findings include:

Low Productivity
Maine ranks #41 in economic output per capita and #46 in output per worker.
Aging Workforce and Low Labor Participation
Despite above-average participation among working-age residents, Maine ranks #39 overall in labor force participation due to having the highest proportion of residents over 65 in the U.S.
Poor Job and Business Growth
- #37 for private job creation
- #44 for job growth from foreign direct investment
- #50 for new business formation per capita
Lagging Wages
Although wage growth outpaced the national average since 2010, Maine ranks #34 in average wages. Even in typically high-paying “traded cluster” jobs, Maine pays over 20% below the U.S. benchmark.
Weak Innovation and R&D
- #44 in patent intensity
- #46 in university R&D spending
- High industrial electricity costs and tax burdens also hamper growth
Lack of Strong Industry Clusters
Only 5.5% of Maine’s workforce is employed in strong traded clusters, compared to 14.3% nationally.

What Maine Needs Now

According to Rich Bryden, primary analyst and author of the report for PDI:

“Key measures of competitiveness indicate that Maine is not attracting new employment at the same rates as other areas of the U.S. and that existing firms in Maine are not achieving the high levels of productivity that would support increasing wage levels for employees.”

The assessment makes one thing clear: Maine’s current economic plans are not enough. A successful future depends on a comprehensive, integrated strategy—targeting: