Hey, MA GOP, is this what you meant when you said that everyone is going to shop in New Hampshire?
Retailers are in fact coming to Massachusetts because the economy here is improving more quickly than the rest of the country. Via the Globe:
Merchants are coming back to the state in part because the economy here is improving more quickly than in other regions of the country.
So retailers want to go to a state that has a governor with “effective management during strained economic times”? Maybe a “willingness and ability to promptly identify and close gaps through use of both new revenues and spending reductions”?
In essence, what we are seeing is the impact of effective fiscal management.
Discuss
16 Comments . Comments are closed.Yesh!
More Targets, Best Buys, Bed Bath & Beyonds, Babies R Uses, Wal*Marts, Staples, and Home Depots. If we're lucky we'll get a few Bass Pro Shops, Old Navies, and Cabellases, too. Great!
Sorry, more like ...
Ultimate Electronics (Best Buy competition) and Savers introducing themselves in the area.
Looks like we are not getting away from retail focusing on big box stores and outdoor plazas. But retail goes where the money is and they are focusing here since the economy is picking up faster than anywhere else.
What has dumbfounded me is Sleepy's, 4 new stores in my area, every new mall/plaza has one. Why? Did we have a shortage of mattress stores and needed one every few miles? Odd.
What the article doesn't explore
is if the big box stores are coming in to occupy currently vacant big box space, or if they're building more big box space. After all, that big box space is already built, and while a few of 'em are being carved up (into a TJ Maxx and a Panera), even when that happens it's very likely that they'll be filled with national chains... and therefore the profits get siphoned out of the community.
Ultimately, it comes down to zoning, and communities fighting the appeal of get-rich-quick schemes even though all the evidence points to a race to the bottom in order to prevent the big box buildings from being built in the first place. Sounds strangely like casinos, although that wasn't my intention.
yes, there does seem to be a glut in development ...
the article does not that the newer chains are going to occupy some old Circuit City locations. My guess is that they would probably get a better deal if they are occupying empty space and not developing more. Established locations with known activity.
Manufacturing loss
Sadly, I can't tell you how many times I have read stories about former value-added businesses (manufacturing, etc.) being converted into retail. For example, the plan to convert the Polaroid plant into retail. We had one floated in Springfield -- a former Westinghouse factory which employed thousands with middle-class blue-collar jobs at its peak is to be converted into a shopping plaza.
This is not a good sign. Massachusetts can't survive only on consumerism of goods produced elsewhere. We need to produce things that other areas consume.
We produce tons of stuff that others consume
* education * research * finance * law
Those things don't typically involve the manufacturing of a tangible product, but they are value-added transactions which result in money flowing into Massachusetts from other states or nations.
They also don't have the impact on employment numbers
that manufacturing has. Service sector is a big step down unless you are in one of these high-education, high-skill services.
How to do manufacturing profitably in Massachusetts, of course, remains a substantial problem.
That is a solid point...
and I have no idea what percent of the folks who work in those sectors have "mid range" jobs -- admin, HR, B&G, technical staff, that sort of thing. This is, of course, in addition to the public sector "mid range" jobs -- cops and firemen, civil servants, teachers, DPW, MBTA, etc.
It occurs to me that the building trades are also those kinds of jobs. Low requirements on higher ed, physical work with capital equipment, some specialized training, typically male dominated.
If the "solution" is to slice wages so that the jobs offer the same salary and benefits package that "service sector" offers, maybe it's a problem that ought not be solved. I'm not claiming you suggested this; rather I credit you for pointing it out.
Yes, but
I was actually thinking more about the number of positions, as much as the difference in pay/status from machinist in a manufacturing plant to nighttime custodian of an office building. Admin, HR, etc. in big law/financial firms will never employ the same number of people as the Gillete plant once did.
The good thing about the service sector is that the jobs are where the demand is. People need legal services in Massachusetts, I provide them in Massachusetts.
Manufacturing need not be local. So your non-solution (slice wages so they match the service sector) doesn't even work, because you must make it cost effective to manufacture a thing in Massachusetts vs. manufacturing it elsewhere and that entails more than just the wage numbers, but all other costs of labor.
Manufacturing is expensive in Massachusetts because it requires a lot of employees. Having employees here, vs. elsewhere, is expensive. There's the health insurance issue, the financing of which largely falls to employers. We have very generous unemployment insurance in Massachusetts, also largely funded by employers. Worker's comp costs, at least, don't seem awful compared to other states, but still add to the bill. All of these make it harder to run a business that requires a lot of employees here, especially when competing against a manufacturer that does not bear these expenses. In other words, my law office can employ a half dozen people, but if we had to employ several thousand in a low-margin business (like manufacturing) the cost of all those employees piles up.
I don't think I was suggesting a solution-- the costs of labor in Massachusetts that are derived from the above, and other, government induced factors probably do little more than amplify a trend that would exist anyway.
I wasn't clear...
In the sense that a single large manufacturing plant had more of these "middle class" jobs (for lack of a better phrase) in one place, I absolutely agree, and tried to express that above. My thought about that kind of job (relative education level and wages) now shifting to admin/HR/etc is that the jobs are similar, not that the numbers are the same... though without looking at labor numbers, I have no idea which time period had more of these kinds of jobs overall. Was it during periods of more manufacturing, when relatively few manufacturers had many many middle class employees, or moreso now with middle class employees being dispersed widely in many many office buildings around the area. Dunno.
I didn't think you were either. You pointed out that the industries I listed don't have nearly as high a percentage of middle class-type jobs as manufacturing, and I agree. You also pointed out that getting them back is a tough nut to crack. My observation is that if we've got to slice the wages and bennies of a manufacturing job to the point where it's no better than a service job, it may not be worth getting those jobs back.
What remains unclear to me is the percentage of jobs which are "middle class" over time. Has it shrunk? I mean, we in middle class society seem to be far wealthy then each of the prior generations. Houses have gotten much bigger. The number of autos per household has gone up dramatically. The vacations we take, the amount of clothing and electronics we own, the amount of dinners eaten in restaurants have all gone up amongst middle class households. So, if "middle class" in 2010 results in having far more tangible wealth than it did in 1960. Is that because women are working? Is that because we're financing everything? Is that because jobs in the service sector or other lower paying jobs are actually closer in purchase-power-wages to middle class jobs 40 years ago? I have no idea, but methinks it's likely pretty complex.
I do worry about a camel hump'd income society -- a huge chunk making service sector few-benefits wages, and a huge chunk making really strong wages and benefits, with little in between. The jobs which seem to be in between (and again, this is far from my areas of expertise) are union jobs, be they public sector or the trades.
It's not just union jobs
Technicians, machinists metal workers all make good wages at manufacturing firms. The state needs to stop trying to chase them away.
One major issue is unemployment insurance, it stinks for the employer (you can quit your job for about any reason and still collect) or if you are fired for any reason except a felony (at the workplace) you will collect. The employers put the money into a trust fund - that the state has already raided for other uses. The state isn't going to reimburse the fund - they raised the rates on employers. It needs to be fixed.
The state has a surtax based on gross revenue not profit, that's a great way to encourage business to be here.
Why are some people down on retail?
More retail must mean more people are spending thus infusing cash into the economy. I for one am thrilled that retailers find they can do business in MA. You can't outsourse sales associates, after all, and I don't think that in this climate when jobs are being increased we should then complain they aren't "good" jobs by some standard.
Who is down on retail?
I haven't seen any posts here which are "down on retail" per se.
Some of your comments...
...were among those that sounded at least skeptical. If I misinterpreted I apologize.
I like retail
I just much prefer Main St retail to Wall St retail. I'm partial to retail under 5000 square feet, to retail which is part of a community fabric instead of a massive car park, to retail which is wholly owned by people who live within 25 miles, to retail which focuses on customer service and not economies of scale. Retail which sells at least some products created locally. Retail which reinforces local culture and customs.
I like retail. This particular article was about a particular kind of retail of which I'm not as big a fan.
Local retail
Here in downtown, we've had a few retail biz's open, a clothing store I like (and a few catering to the younger set I am no longer a part of, that I don't frequent), a local market, etc. I think as big retail ramps up, the less sexy and harder to see littler retail outfits also open. But they're under the radar.
Of course, not everyone has a keen downtown like Lowell has. ^_^
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