March 7, 2013

MAINE COMPASS: Demographics show Maine lacks in 'prime working' age group

Ken Young

Demography is destiny.

Demography is the study of population and its characteristics, and is often used to highlight changes in the workforce and economy.

The 2010 Census reaffirmed that Maine's population remains the oldest in the United States. We know also that innovation is key to a successful economy, and that the capacity for innovation is tied, although not exclusively, to the size of the "child bearing" and "prime working" (18 to 44) age group in the population. This group is shrinking in Maine.

Recent research suggests that there is a point regarding the relative size of the 18- to 44-year-old group below which a region/state encounters profound challenges to continued economic growth and sustainability.

It appears that when this group falls below 30 percent of the population, adverse effects associated with an older and aging population are reinforced.

In Kennebec and Somerset counties, for instance, the 2010 Census reports that the 18-to-44 group is 31.9 percent of the total. In 1990, it was 41.1 percent, and in 2000 it declined to 36.6 percent.

This ongoing decline is reflected in the counties' average wages, median household income and per capital income; all are lower than in the United States and in Maine as a whole.

The labor force participation rate here (63.4 percent) is the second lowest of any of region in the state. The share of the 45- to 64-year-old group is growing, from 19.3 percent in 1990 to 31.4 percent in 2010.

What can we do in the face of this decline? We must often conclude that if we can keep new high school and college graduates here, and entice less-recent graduates back, we will be all right. The demographics, however, tell a different story.

If everyone born here over the last 20-plus years never left and or if everyone who left came back, the 18-44 group still would come up short.

So what can we do to stay above the apparently critical 30 percent level for 18- to 44-year-olds?

One idea seldom discussed is coupling our quality of place with direct support for in-migration of people and families with children with a post-secondary degree or certification in the 18 to 44 group.

A breakthrough study in 2007, "Place and Prosperity," co-authored by Kate Reilly and Henry Rensky for the Maine Quality of Place Council, found that Maine's principal competitive advantage in the ongoing contest to attract the people we need is our quality of place, that distinctive mix of the natural and built environment and culture that underwrites so much of our economy.

To compete for the people we need, we should leverage our Quality of Place to keep Mainers in Maine and to attract newcomers -- from the rest of New England, elsewhere in the United States, even from way away.

How to compete effectively for people should be on every economic developer's agenda. Perhaps it should be the topic around which we build a 10-year economic development strategy, marshalling a critical mass of policy and resources focuses on growing the population.

Now and going forward, we need to focus in ways we have not in the past. There are models out there for us to emulate.

New Brunswick is in the midst of just such an effort, begun in 2010 for exactly the same reasons -- the dead end destiny forecast by their demographics. It is now clear to provincial officials that a "passive and piecemeal approach to population growth is simply no longer a possibility we can afford."

In order to respond properly to the current demographic and economic challenges facing New Brunswick, the province is committed to a transformational policy shift."

Their strategy details specific ways and means for New Brunswick to increase and target immigration, promote diversity and multiculturalism, retain youth, repatriate former residents and make New Brunswick the family-friendly Canadian province.

What should do Maine do next? While some elements are in place, we need to agree on a strategy, similar to New Brunswick's approach, one scaled to our resources, and to act on it.

There is no time to waste and, as our regional demographics demonstrate, even less time to act.

Ken Young is executive director of the Kennebec Valley Council of Governments. He can be reached at kyoung@kvcog.org

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