The head of a leading Massachusetts business association says he’s increasingly concerned about the economic impact of a growing labor shortage across the state.
During an annual address Tuesday, John Regan, president and CEO of Associated Industries of Massachusetts, noted the commonwealth has lost tens of thousands of workers to other states in recent years. Massachusetts’ birth rate also has fallen in recent decades, and Baby Boomers are retiring more quickly than previous estimates suggested.
All of that combined is making it increasingly difficult for employers to fill jobs and meet production goals.
“The workforce challenges looming over the Massachusetts economy are dire,” Regan said. “The long held belief that Massachusetts’ talent base would always anchor our economy is breaking down and the concentration of high-skilled jobs that tethered our highly educated workforce to Massachusetts has begun to fray.”
Regan said his conclusion draws from predictions about Massachusetts’ economy and workforce. The state currently has 115,000 more job openings than unemployed workers, he said. By 2030, the number of jobs across Massachusetts is expected to grow 21%, according to the state Department of Economic Research, but the workforce will expand just 1.5%.
To mitigate the labor shortage, Regan said state leaders must do more to make Massachusetts attractive for workers. From 2020 to 2021, U.S. Census data shows the commonwealth’s population declined by more than 40,000 residents, part of a pattern across the Northeast. Regan attributed that to residents moving to other states with warmer climates and lower costs of living.
He suggested commonwealth leaders make Massachusetts more competitive with other states by incentivizing the construction of more housing to help moderate rents. And noting that 10 other states reduced their income tax rates last year, he said Massachusetts should do the same. The state’s current rate is a flat 5% for all individual taxpayers and an additional 4% for earnings over $1 million.
Regan also advocated for longer parental leave, an expansion of federal work visas for immigrants as well as more vocational and training programs that will help workers develop the skills they need for certain careers.
“We support Gov. Healey's MassReconnect initiative, which would fund community college certificates and degrees for state residents who are 25 years old and older who have not earned a college degree,” Regan added. “We believe that Massachusetts will thrive only with a commitment to inclusive economic growth that brings as many people as possible into the workforce and leaves no one behind.”
Following the address, several business leaders in Massachusetts shared their experiences with the growing labor shortage.
Erin Birmingham, head of talent acquisition for the pharmaceutical firm Takeda, said the company currently has 500 open positions in the Massachusetts area. One way Birmingham is trying to fill openings is by hiring students at Middlesex Community College to work as contractors. Once they graduate school, they can make an easier transition to working for Takeda full-time.
Annemarie Abdo, vice president of human resources at Catania Oils based in Ayer, added the edible oil company is offering increased bonuses to employees that refer people to open job positions. The manufacturer also has begun providing employees with more benefits, like complimentary transportation to work and back home, and is launching advertising campaigns to attract new workers.
“So it's really not one method [to attract more workers]. We just explore all the different methods that we possibly could use and really have been creative,” Abdo said.