Mass Business Blog

News and Perspectives on Massachusetts Business and Economy

Was Massachusetts REALLY Rated Worst Drivers in the Country . . . Again?

Allstate just released their 2015 Best Drivers Report; once again, Massachusetts found itself near the very bottom. According to the 2015 report, Massachusetts is home to three of the five lowest-ranking cities in the US: Springfield was ranked 196th; Worcester was ranked 199th; and Boston, sitting in 200th place, was rated the very worst city for driving. Boston drivers averaged just 3.9 years between accidents and are 158% more likely to get into an accident than the national average. Worcester residents ranked only slightly higher, with an average of 4.5 years between accidents and a 120% greater likelihood of getting in an accident than the national average. In 2012, Massachusetts experienced 349 crash-related fatalities and nearly 4,400 serious injuries. Of those who were killed in these crashes, 161 were drivers, 48 were passengers, 51 were on a motorcycle, 72 were pedestrians, and 15 were riding a bicycle. However, when compared to the national average on fatal accidents, Massachusetts doesn’t look so bad. The Insurance Institute for Highway Safety (IIHS) found there were 4.9 deaths per 100,000 residents in the commonwealth, which was one of the lowest numbers in the country. Wyoming, with the worst population-to-fatality rate, was over five times higher, at nearly 26 deaths per 100,000 residents. These statistics should give Bay Staters plenty to think about. Simple acts, like obeying the speed limit, stopping for pedestrians, and avoiding distracted driving can help reduce our chances of getting into accidents . . . and will hopefully help our cities rank higher in years to come. — Author Bio: Peter Ventura has more than 25 years of experience as a trial lawyer and practices personal injury law in Worcester, Massachusetts—the same city in which he was born. From 1982–1985, he served as the assistant district attorney in Worcester County, where he tried hundreds of cases. He has also served...

Big Win for Injured Workers in MA: Courts Now Allowing Compensation for Pain and Suffering Damages

On February 12, 2016, the Massachusetts Supreme Judicial Court ruled that, in third-party settlements, workers’ compensation liens will not cover damages for injured employees’ pain and suffering. The compensation for these “noneconomic damages,” which had previously been awarded to workers’ compensation insurance providers, will now be passed on to the workers. The ruling in the case—DiCarlo vs. Suffolk Construction—came as a victory for injured workers, ensuring that workers’ compensation insurance providers may not claim the entirety of a worker’s settlement with a responsible third party. The Law in Massachusetts Massachusetts workers’ compensation law entitles injured workers to compensation for medical care and lost wages. However, it does not provide compensation for pain and suffering. In some cases, a worker’s injuries at a workplace occur as the result of negligence by a third party, such as a property owner or contractor. If the third party is responsible for the injury, the injured worker can sue for damages—including compensation for pain and suffering—from the individual or party at fault. In DiCarlo vs. Suffolk Construction, the court ruled that workers’ compensation will not cover the portion of a third-party settlement intended to cover pain and suffering. What Is the Business Impact of the Court’s Decision? Third-party settlement amounts are sometimes less than the full amount of a workers’ compensation lien. An injured worker may choose to accept a compromise settlement that guarantees some compensation rather than risking a loss at trial. Prior to the DiCarlo ruling, a workers’ compensation insurance company could reduce its lien and allow an injured worker to keep some portion of a third-party settlement; the law, however, did not mandate such a lien reduction. From now on, an injured worker will now receive the portion of a third-party claim set aside for pain and suffering, with the remainder of the settlement used to defray legal expenses and any...

Paying Boston’s Sky-High Rent Price: Housing at $2,000 a Month Across Massachusetts

If you’re a resident of Massachusetts, you’re certainly no stranger to rent prices that are, well, wicked high. You also aren’t going to be too surprised to hear that rent is continuing to rise . . . and rise, and rise some more. As of early 2016, the average per-person rent in Boston—a city of 655,884 residents—was over $2,000 a month. But why? How come it’s so darn expensive here? It’s cold, it’s snowy, the T is usually late or broken, and the only good thing about the ridiculous traffic is that it makes the potholes seem less severe (sorry folks, we’re just missing summer this week). Regardless, analysts say that the improving economy and the high per-capita income in the commonwealth are two main reasons for our sky-high rent prices. The real estate data firm Reis, Inc. and online estate sites like Trulia and Rent Jungle have compiled some data on rising rents in Boston and Massachusetts, but we have decided to do our own investigation. We’ve modeled it after Buzzfeed’s “This Is What $1,000 a Month in Rent Would Get You All around the US” article, but have modified it to be a Massachusetts-only version. Just as they did, we tried to find a variety of rent examples, from tiny (often listed as “cozy”) apartments in Boston, to luxurious North End apartments in Cambridge, to rent-to-own houses on the South Shore. Here’s what kind of housing you can get for about $2,000 a month in our wonderful, bustling, sometimes-jaw-droppingly-expensive state:   One-Bedroom Apartment: Boston Rent: $1,655  Size: 580 ft2 Neighborhood: Chelsea/Box District Source: Zillow Amenities: With a fitness center and a parking spot for the used car you bought from your parents, this is an apartment you could easily call home. Additional amenities include hardwood floors, granite countertops, and a roof deck. We recommend using the deck to look...

Biotechs and Robotics Pay Off for Massachusetts

A law passed in 2008 that provides subsidies to biotech and robotics companies in Massachusetts is helping to grow these industries in the commonwealth. Some say the biotech and robotics industries in MA are beginning to rival those of Tokyo and California, which have long been considered the global leaders in this type of business. Massachusetts Received One Third of Seed Stage Funding One of the reasons for this growth in the commonwealth is the Massachusetts Life Sciences Act of 2008. This legislation authorized $1 billion in investments, grants, loans, and tax breaks over the next decade to be given to local biotech companies. The government is following through with their promise; they have presented over $761 million in seed-stage funding for these businesses between 2009 and 2013. This has allowed nine of the ten largest drug manufacturing companies to set up research and development laboratories in Massachusetts. Homegrown vs. Tax Incentives—Paying Twofold One of pivotal stipulation of the MA incentive package is that it focuses on local businesses who have already been working in the industry. Legislation hoped to unlock the commercial potential of research already being conducted at state universities including Harvard, MIT, and the University of Massachusetts. By attracting smaller companies on the cutting edge of research, Massachusetts has found that large companies tend to migrate to states where those small companies are thriving. Massachusetts Grows Connections—And Keeps Them Attracting smaller companies that draw the interest of larger companies has helped Massachusetts become a leader in the biotech and robotics industry. The new financial incentives attract companies and talent to the commonwealth. As the biotech and robotics industries continue to grow, investors have become more motivated to provide additional seed money for growing companies. Larger companies have spent more time mentoring startup companies after seeing their industry swell; the success of large and small companies comes...

Is It Legal for Hospitals to Ban Nicotine-Positive Employees in MA?

In 2011, UMass Memorial Marlborough Hospital adopted a tobacco-free policy for its property. Recently, the same hospital announced that they would be establishing a nicotine-free hiring policy for all new employees as well. Nicotine will join amphetamines, benzodiazepines, cocaine, and others on the list of prohibited chemicals. Hospitals test for these drugs following the interviewing and application process; it is often the last step before an applicant becomes an employee. Marlborough Hospital Leads Nicotine-Free Hiring According to Steve Roach, president and CEO of Marlborough Hospital, the decision to hire exclusively nicotine-free applicants is meant to encourage employees’ healthy decisions. He expects his employees to abide by the same health advice they give to their patients—to lead by example, essentially. All hospitals in the UMass system have smoke-free and tobacco-free campuses, but Marlborough is the first in the commonwealth to establish a nicotine-free hiring policy. Is Banning Smokers Illegal? There is no federal law that protects smokers from these regulations, as the Equal Employment Opportunity Commission does not recognize tobacco smokers as a protected class. However, individual states have their own approaches. Some states say that companies cannot refuse to hire someone simply because he or she is a smoker. Massachusetts is obviously not one of those states. Even some of the states that protect smokers tend to be more strict with the healthcare industry and nonprofit organizations. Some experts say that this ban will unravel a mess of additional issues. They argue that discriminating against smokers is the same as discriminating against those with diabetes or high cholesterol. There is also the concern that a tremendously well-qualified applicant will be turned away for what some deem to be a trivial issue. Massachusetts Aims to Set Healthy Example A Swedish study found that smokers take an average of 7.67 more sick days every year than people who have never smoked....

As Housing Booms in MA, Residents Push for Even More Construction

August 2015 marked the third straight month of increased housing sales in Massachusetts. This continued spike has lawmakers worried about the availability of affordable housing in the commonwealth—housing units are being swooped up faster than they are being built. The goal is to make sure that, as MA continues to compete to bring in workers, it also competes to provide sufficient housing for those workers. A bill, sponsored by the Housing Committee co-chairs, Senator Linda Dorcena Forry (D) and Representative Kevin Honan (D), has been proposed that would increase the amount of housing stock in the commonwealth. Housing Partnership Directors Testify In early October, advocates for the bill testified before the commonwealth’s Housing Committee. Somerville Mayor Joe Curtatone, among others, have stood behind the bill. MA Housing Partnership Executive Director Clark Ziegler testified that the average single-family home in metropolitan Boston takes up over one acre of land, which is about equal to one NFL football field. The size of these properties has less to do with what people want and more with what local zoning restrictions demand. Even though most buyers prefer homes on smaller lots in neighborhoods that are more walkable, zoning laws make these homes more difficult to put together. Many communities ban the building of multi-family homes altogether. It isn’t news to say that the cost of renting housing (or the cost of taxes on owned property) in Massachusetts continues to spike. We’re still picking our jaws off the floor after reading this article about wages and rental costs. Even short-term rental properties face increased regulations and pricing. Residents statewide are feeling trapped—some areas are simply becoming too expensive for people to afford. Moderate and Low Income Residences One of the goals of the bill is to address the lack of low- and moderate-income housing stock in Massachusetts. If passed into law, the bill would...

Everything You Need to Know about a Styrofoam Ban in MA

Two legislators in Massachusetts have sponsored a bill that would eliminate the use of Styrofoam containers in the commonwealth. The bill has been endorsed by eighteen other lawmakers who agree that Styrofoam is harmful to the environment and should no longer be offered to consumers. Styrofoam Bans Across the United States Many national chains, including McDonald’s and Dunkin’ Donuts, have already eliminated the use of Styrofoam in their food containers and started using more recyclable materials. In 2014, Washington, DC, banned the use of Styrofoam, joining many cities who had already done so. Cities and counties in California, Florida, Maine, Maryland, Minnesota, New Jersey, Oregon, and Texas have all banned the use of Styrofoam. BPA and the Debated Sins of Styrofoam One of the biggest concerns with Styrofoam, or polystyrene foam, is that—while cheap to produce and easy to shape—it contains a compound called bisphenol A (BPA). Since the 1960s, BPA has been the go-to ingredient for strengthening plastics like Styrofoam; its durability and simple production made it seem like a no-brainer. At one point, the FDA even declared it to be entirely safe. However, a number of recent studies have challenged the infallibility of BPA and polystyrene. The two have been linked to hormonal balance, heart disease, diabetes, breast cancer, impotence, and developmental issues in fetuses and children. The arguments from both sides of the BPA debate are admittedly a little blurry. Some experts are adamant that BPA is safe while others vehemently declare it to be a life-threatening compound. Patricia Hunt, a graduate professor and geneticist at Case Western Reserve University, along with a team of 36 other researches, dove into the data. What they found was that, of the hundreds of government-funded studies analyzed, “90 percent had concluded BPA was a health risk. It was the dozen or so industry-funded studies [ . . . ]...

WE BOS Supports Women Entrepreneurs in MA

A new initiative in Boston seeks to close the gender gap in business ownership and success. In 2012, women owned about 36% of all small businesses in the US; however, men-owned firms average a 67.9% higher profit margin. Boston Mayor Marty Walsh recently announced WE BOS, a plan to help establish and grow women-owned businesses in Massachusetts with training, networking, and business counsel. Problem #1: Massachusetts Lags in Female-Owned Mid-Markets A recent report by American Express and Dun and Bradstreet examined women and minority ownership of “middle-market” businesses. These are defined as businesses with annual revenue above $10 million but below $1 billion. There are approximately 4,000 such businesses in Massachusetts. Only 5% of these businesses are owned mostly by women; a paltry 14% have female chief executives. Problem #2: Obstacles Include Lack of Access to Funding Women-owned businesses often face obstacles when trying to get the necessary funding and support to grow. About 2% of venture capital funding is dedicated to women-owned businesses. This may be a consequence of Problem #1—that there aren’t enough women in leadership positions to even receive funding. A recent study by Babson College found that only 6% of venture capital firms have even a single female partner. Over the past ten years, the number of women-owned businesses in MA (and their success rates) has steadily increased, but not nearly as fast we’d like it to. Solution: WE BOS Seeks to Boost Women in Business The news is not all bleak. The AMEX and Dun and Bradstreet survey indicates that women-owned businesses able to crack into the middle-market tend to have higher rates of both revenue and employment growth—they just need a little help getting through the door. Massachusetts leaders have taken the initiative to get women-owned businesses on their feet and put them in a position for growth. The initiative is called Women Entrepreneurs...

Average Salaries: How do Massachusetts College Grads compare?

Median Salary for Alumni A new tool released by the federal government, College Scorecard, details the average earnings (and more) for attendees of nearly every college and university in the United States. The site uses students’ federal financial aid records and federal tax returns to determine their salaries ten years after they first enrolled. Data from 70 Massachusetts schools—ranging from small, private universities to larger, state-funded institutions—shows an average salary of around $49,000. National Trends and Surprises Although the tool reveals some trends that are already well-known to many (e.g., the salary of someone who attended a medical school will likely be higher than that of someone who attended an art school), it also sheds light on some new information. Some of this information is darker than we’d like. For example, less than 50% of those who attended college ten years ago currently make more than $25,000 a year. This figure falls right around the average salary of those with only a high school diploma. We will add, however, that the site includes data for those who attended college; whether or not a person graduated (and what type of college they attended) are not considered. Median Income for MA Alumni Above National Average Massachusetts’ average of $49,000 is significantly higher than the national average of $34,343. MCPHS University, of Boston, is at the top of the list, with an average post-attendance salary of $116,400; MIT trails with an average of $91,600. Even those who attended Pine Manor College, which sits near the bottom of our list, make an average of $34,700 a year. Are the Costs Actually Outweighing Benefits? At first, the statistics in the previous section read like phenomenal news . . . and to some degree, that’s exactly what they are. Still, it may be best to take the data with a grain of salt. We should...

Millennials and Manufacturing: Can They Work Together?

An Incredible (and Daunting) Opportunity for Manufacturers US manufacturing is an absolute behemoth of an industry. CNBC recently reported that manufacturers contribute over $2 trillion to the US economy each year, and remarkably, it’s still growing. Experts predict that over the next ten years, there could be more than 3 million jobs opening up in the manufacturing industry. This is fantastic news for Massachusetts, whose manufacturing industry generates over $45 billion annually. The caveat, however, is that these 3 million new jobs need to be filled . . . fast. About 10,000 Baby Boomers retire every single day, and we’re now seeing the need for skilled workers to take their places. Who is going to step in? Millennials. No, we’re not kidding. This young generation, seemingly defined by selfie sticks and social media accounts, is rushing toward the workforce with skill sets and abilities we’ve never seen before. They’re no longer just kids, and like it or not, manufacturing companies need them—their futures depend on it. Companies in the manufacturing industry and elsewhere are realizing that the best (and possibly, the only) way to assure long-term success is to funnel Millennials their way. They’re now asking a few questions: Why would we want to hire Millennials? Why would they want to work for us? How do we make it happen? Addressing the Stereotypes: Do Manufacturers and Millennials Even Want Each Other? There is a huge elephant in the room, and it’s name is “The Age Gap.” Many manufacturing executives are Baby Boomers (born 1946–1964) and Generation X-ers (born 1965–1980); Millennials are those born between 1981 and the early 2000s. What this means is that the age gap between existing employees and new hires can stretch forty years or more. Bridging that gap in the workplace presents discernable challenges. As reported by ThomasNet, some employers are standing at one side...

MA Welcomes Fall Festivals and Foliage, Expects Rush of Tourism

Fall in New England has always attracted crowds of hikers, bikers, zipliners, wine-drinkers, leaf-peepers, shopaholics, and anyone simply hoping to enjoy the crisp autumn air. However, over the past few years, seasonal sales have been better than ever. Some believe the region’s success can be linked to a growing interest in fall-themed festivals and the development of destinations like Salem, MA, nationally known for its Halloween-oriented history of witchcraft. Massachusetts Businesses Benefit from Booming Tourist Industry Many families and individuals vacation in the fall—traveling during the school year usually means fewer crowds, lines, competition for lodging, etc. This helps keep businesses profitable after the summer rush—hotels, restaurants, retail outlets, and others reap the benefits. Even athletics teams and associated companies (e.g., those responsible for ticketing, facilities maintenance, entertainment, food, etc.) have reported an uptick in “post-season” sales due to the longer tourist season. History of Massachusetts Is Ideal for Autumn Holidays Stories of the Salem witchcraft trials have long fascinated tourists traveling to Massachusetts. The town commemorates the trials every year with a fall festival known as Haunted Happenings, which kicks off with a parade on October 1. The event began in 1981 with a “Witches Weekend” and is now a month-long series of trolley tours, ghost tours, films, nighttime ghost stories, and walkthroughs of the House of the Seven Gables. The city is full of other attractions like museums and haunted houses designed to promote the “spooky” history of Salem while demonstrating top-of-the-line Massachusetts hospitality. Fall Festivals Across the State While popular, Salem is certainly not the only place in Massachusetts to partake in the autumn festivities. New Bedford offers the Working Waterfront Festival at the end of September, spotlighting one of America’s largest fishing ports. Visitors to Cheshire, MA, can view glass-blown pumpkins and other artisan crafts at the Fall Arts Festival. Families love the Cranberry Harvest...

How Legislation Is Fighting Airbnb in Massachusetts

Airbnb is an online community that connects short-term renters to people with space to rent. The company began in 2008 as “Air Bed and Breakfast” and was imagined after its founders rented out airbeds in their home. Six years since its humble beginning, Airbnb has shortened its name and inflated its offerings to include small rooms for international travelers, villas for high-end business travelers, and just about everything in between. The company makes it easy to find both simple spaces and those with all the comforts of home. Hosts can post pictures and descriptions of the spaces they have available; travelers can then reserve those spaces on Airbnb’s secure website. Airbnb Offers an “Authentic Experience” for Travelers There are many benefits to using a service like Airbnb, including the opportunity to meet people from around the world without having to pay for an expensive hotel room. Airbnb hosts also tend to provide more personalized services (e.g., welcome baskets and access to cooking- and crafting supplies) that outclass those offered by most hotels. Airbnb is becoming a popular resource for small towns around the world that hope to attract tourists but have limited lodging options. Building a new hotel can cost between $300,000 and many millions of dollars, so smaller towns simply can’t afford lodging for the tourists they hope to attract. Airbnb and other short-term rental companies offer a less-expensive alternative to hotels. Short-Term Rentals Prompt Legislative Concerns for MA Despite the benefits of the service, some legislators are expressing concerns about Airbnb. In Massachusetts, state representatives Aaron Michlewitz and RoseLee Vincent have tried to introduce legislation that would be among the strictest in the country for short-term rentals. The measures would legalize the rental process but impose strict safety and registration requirements, as well as a 5% tax on rentals (to match the tax for hotel rooms). The...

Common Core Standards Are Questioned in Massachusetts Education

  A spirited group of MA citizens, End Common Core MA, hopes to eliminate Common Core standards from the commonwealth’s education system. The MA state attorney general has officially declared the potential vote to be constitutional—a significant leap toward End Common Core MA’s goal. The group’s next (grueling) step is to gather 65,000 signatures for their cause, which will guarantee their question a spot on the November 2016 ballot.   Common Core Standards for College- and Career-Readiness in Massachusetts The Common Core State Standards (CCSS) are a set of academic standards for kindergarten through 12th grade; they specify what students should be able to do by the time they reach each specific grade. The history of the CCSS can be traced back to 2008, when former Arizona Governor Janet Napolitano made it her goal to initiate a set of national educational standards. Napolitano and her team had two primary objectives in creating the CCSS. First, they hoped to make American students career- and college-ready; the theory is that students who meet the CCSS will be prepared for both paths. The second objective was to use the CCSS to compare US student achievement against that of the rest of the world. There is no explicit federal mandate to adopt CCSS, but the Department of Education has created incentives for states to adopt it by including Common Core as a criteria in applications for federal grants. Over forty states, including Massachusetts and the District of Columbia, have adopted some aspect of the CCSS since it was first offered.   Against the Common Core Standards Opponents of the CCSS say that the standards represent a “one-size-fits-all” approach to education and focus too much on assessment and testing preparation at the expense of genuine learning. Valerie Strauss, for example, said in a letter published in the Washington Post: When I read that math...

How the Massachusetts Economy Is Weathering China’s Recession

China’s economic slowdown has affected countries around the world; many economies rely heavily on exports to China. In the United States, Massachusetts companies have begun to feel the impacts of China’s declining manufacturing industry. China’s Manufacturing Decline Causing Losses for MA Businesses In early September, several Massachusetts-based companies trading on the NYSE and NASDAQ showed price-per-share (PPS) losses. Dunkin’ Brands (the umbrella of Dunkin’ Donuts) was off-target by 2.89% and Eaton Vance Management was down 2.88%. Some publicly traded stocks were off by significantly higher margins, including American DG Energy, Inc., which was off 15%, and Collegium Pharmaceutical, off by 10%. Collegium has been plummeting for about a month now and American DG Energy, Inc. is at its lowest PPS since 2009. Recession Concerns for Institutions of Higher Education The suffering economy in China is also impacting the well-being of higher education in Massachusetts. Many universities in the commonwealth, as well as many others throughout the United States, depend on the enrollment of international students, especially from China. If the economic situation in China does not improve, Chinese students may not be able to afford the expenses of studying in the United States. Hundreds of US universities have Chinese programs; if schools are unable to fill them, there may be a resultant shift in the economic stability of these institutions. Some Companies Benefit Luckily, not all MA industries are facing losses from this turn in China’s economy. Less competition from China—a behemoth in each of the above industries—gives some US companies a chance to flourish. Two companies in Massachusetts actually showed recent gains. Ocata Therapeutics (a biotech- and cell therapy company) and Echo Therapeutics (a health- and lifestyle technology company) were up 6.97% and 4.1%, respectively. Technical Communications showed gains of 5.11%. Monitoring Impact of China’s Recession on Businesses in MA Clearly, the economic fluctuation of a country as...

Worcester Named Most Business-Friendly City in Massachusetts

Massachusetts Small Businesses Make a Remarkable Turnaround in Just a Year Business confidence in Massachusetts cities continues to grow . . . and you may not believe which city is at the top of the list. A recent survey of small business owners in New England ranked Worcester, Massachusetts, as the most business-friendly city in the state. When pinned against all cities in New England, Worcester was second only to Manchester, New Hampshire. Worcester’s rise above regional hubs such as Boston and Providence caps a remarkable turnaround for the city. Business leaders agree that Worcester’s business climate is much-improved—the city received an overall grade of “B-” this year despite a lowly grade of “F” last year. Worcester, MA Is Positioned to Expand Across All Business Sectors Worcester and other mid-sized cities serve as a complement to Boston’s hub of finance, education, government, and professional services. They provide a hospitable climate for smaller businesses and manufacturers that may not be able to afford or be recognized in a larger city. Steve Rothschild, considered a small-business mogul in Worcester for his work with Applied Interactive, Bulbs.com, and Furniture.com, says that “Worcester is a great place to run a business because there is a well-educated workforce, an easy commute for employees, and low-cost commercial real estate.” Worcester is particularly well-positioned because it has the history and infrastructure of a manufacturing hub but also a large service economy. The city boasts nine institutions of higher education and five major hospitals. Unlike many mid-sized cities that have struggled with population decline, Worcester has had steady population growth for the past three decades. Per capita income and education levels are on par with the state average. The combination of a well-rounded economy and an educated and skilled workforce allows Worcester to expand in many different sectors. Improvement in Business Confidence “Grade” in Worcester, MA, Mirrors...

MA Craft Beer Industry Pours Money Into the Massachusetts Economy

According to a report compiled by John Dunham & Associates, more than 25,900 new jobs in the commonwealth could be directly attributed to the the growing MA craft beer industry. Not only has craft brewing brought a rush of jobs into Massachusetts, it has generated over $2.5 billion in sales and taxes for the commonwealth. MA Craft Breweries: Profit by the Barrel Craft beer is a growing industry throughout the country—it has grown by 32% over the past few years. Simultaneously, though, large companies like Anheuser-Busch have seen their market shares decrease by as much as 7%. American beer palates seem to be evolving—or have at least begun to align more closely with the flavors of smaller craft breweries. In 1980, the Brewers Association reported that there were just 50 craft breweries in the country. As of June 2015, that number has risen to 3,739. Craft Brewing’s Early Days in Massachusetts There is disagreement about the official “beginning” of the craft beer business, but it has early roots in Massachusetts. In the mid-1980s, Jim Koch went door-to-door in Boston selling his family’s home brew to local bars. He then founded the Boston Beer Company, following the huge success of his flagship beer, Samuel Adams. The company, which recorded a gross 2014 profit of over $465 million, is still dedicated to the growth of the MA craft beer industry. Early in 2015, the Boston Beer Company partnered with Accion to offer microloans of between $500 and $25,000 to small breweries. They also sponsor a hops-sharing program that helps smaller breweries obtain the hops necessary to brew India Pale Ales (IPA), one of the most popular styles of beer. MA Craft Beer Taps Into Other Industries Craft beer sales have significantly improved the Massachusetts economy in a number of ways. Twenty-nine cents of every dollar spent on craft beer in Massachusetts go...

Massachusetts Startup Creates Database to Connect Manufacturers

While experts have regularly acknowledged the decline of the manufacturing industry in America, they have done very little to reverse it. An innovative, new-business incubator in Somerville, MA is starting to take steps in a better direction. Greentown Labs—A Manufacturing and Technology Incubator Greentown Labs assists other startups in the technology and manufacturing fields. Like many business incubators, it incorporates a cooperative working space for startups. However, unlike the others, Greentown also offers prototype-manufacturing space, shared machinery and shop tools, and a large event space. In total, the lab offers 33,000 total square feet of creative space for their companies. Manufacturing startups at Greentown are provided with the necessary infrastructure to move their company from conceptual stages to actual production- and revenue-making stages. Greentown Labs currently hosts 40 companies and supporting organizations that employ over 300 people. Not surprisingly, many of Greentown’s companies specialize in clean technology and the energy industry. The lab also boasts an impressive list of energy-conscious alumni that have “graduated” into their own spaces. Not only do Greentown companies have a versatile physical space to use, they also utilize the services of “sponsor companies” to assist their operations. For example, members are granted access to sponsor-supplied software at little to no cost to their company. Additionally, members have access to marketing, human resources, graphic design, insurance, and other services. Companies working in the incubator also have the all-important opportunity to network and collaborate with other startups. Bringing Manufacturing Innovation Back to the Bay State Incubators such as Greentown Labs make it easier for startups to bring manufacturing job opportunities back to Massachusetts. Over the past several years, Boston has quickly emerged as one of the country’s leading technological hubs. While major research universities such as MIT and Harvard play a role, a business incubator devoted to manufacturing provides a unique, invaluable advantage to the Boston...

Massachusetts Confidence Index Offers Promising Data

Stemming the tide of declining confidence in the Massachusetts economy for the first time in three months, employers indicated that they had a more positive view of the state’s economic outlook during the month of July. The Associated Industries of Massachusetts Confidence Index, which serves as a barometer of local business activity, increased by nearly three points last month, rising to 59.2 points on a scale of 100. Seen as a benchmark of business function and opportunity in Massachusetts, the Confidence Index registered an all-time high of 68.5 points in 1997 and 1998; they saw a historical low of 33.3 points in 2009. A lobbying and management group, the Associated Industries of Massachusetts (AIM) collaborates with Massachusetts employers to enhance the business environment and generate greater business opportunity. They also engage various sectors to help reduce healthcare expenditures, unemployment insurance assessments, and other related business costs. AIM also collaborates with legislators in defining regulations on local, state, and federal levels and promotes the need for a knowledgeable and skilled labor force. Another priority for the group is keeping members informed about mandated changes in employment standards and other regulations that may have an adverse impact on their business and the economy of the Commonwealth. Chairman of the Associated Industries of Massachusetts Board of Economic Advisors Raymond G. Torto asserts: The AIM Index is up three points from last July, and apart from its recent crest in February and March is at its highest level since December 2006. Like the economy itself, the Index has followed a long-term trend of improvement. But the upward course has been longer and bumpier than most past recoveries. Data extracted from the released report indicates that the current Massachusetts confidence index data is as strong as from 2006, preceding the 2007 recession. Details from the Index: Employers’ opinion of current business conditions, the Current Index,...

Millennials and Money: Where Financial Literacy Failed

Looking back on your high school days, you probably remember lessons like long division or the day you finally mastered a cursive “Q.” But what about the class where you learned to balance a checkbook? Or apply for a car loan? While Baby Boomers were more likely to reap the benefits of a home economics class covering life skills and simple financial planning, Millennials are now facing a devastating education gap when it comes to basic financial literacy. Now, a pair of Worcester natives are on a mission to target this educational blind spot and help money management make sense to our future business leaders—before it’s too late. Recent Clark University graduate, Rebecca Liebman, and her brother Michael, are harnessing the power of the Internet to tackle the problem of financial illiteracy among Millennials. They are planning to launch a website called LearnLux.com, which would give Millennials the tools to control and understand their financial futures. Michael Liebman, LearnLux president, is currently majoring in finance at Bentley University, but his passion for figures extends back as far as age seven, when, according to their website, he “proclaimed [ . . . ] that his favorite thing to do was count money.” “The 19–35-year-old demographic has the worst national average for credit scores.” The lack of financial literacy among Millennials has resulted in some frightening statistics. Research by the credit information service, Experian, has revealed that the 19–35-year-old demographic has the worst national average for credit scores, and a significantly unfavorable debt-to-income ratio than any previous generation. According to a recent poll by the Brookings Institution, about 50% of college freshmen surveyed are incorrect or entirely ignorant of the amount of student loan debt they carry. While many hypotheses have been put forward as to the cause of the lapse in financial education for Millennials, the takeaway is clear: Millennials must...

Massachusetts Colleges Team Up to Create a Bright Future in the Photonics Industry

The Massachusetts Institute of Technology and Worcester’s Quinsigamond Community College will be teaming up with SUNY Polytechnic Institute and several other educational institutions on a Federal project to advance the applications the photonics industry in manufacturing. The partnership, known as Advanced Manufacturing Partnership 2.0, represents $600 million in Federal funds which will go toward establishing the nation’s first Integrated Photonics Institute of Manufacturing Innovation. Massachusetts will be teaming up with educational institutions across the nation, utilizing the Commonwealth’s higher educational strengths to explore the applications of the photonics industry in manufacturing. MIT will lead in the development of cutting-edge technology such as robotics and complex medical devices. Meanwhile, Quinsigamond will provide practical training for the development of a middle-skill workforce that will be ready to fulfill a growing number of job opportunities in the manufacturing industry as a whole. “Massachusetts is a key partner because of the technical expertise of the faculty and researchers here at MIT, and in part, because AIM photonics MIT is coordinating the education and workforce development program for the entire nation in this area,” said Krystyn Van Vliet, a professor of materials science and engineering and MIT’s faculty lead for the project. The American Institute for Manufacturing (AIM) began an integrated photonics program in July that was announced by Vice President Joe Biden. The AIM integrated photonics program is one of nine such institutions dedicated to different areas of the manufacturing field. Massachusetts has a long tradition of manufacturing and industrial production. Although textiles and mills may be a thing of the past, burgeoning industries have provided a new realm of opportunity for a state that is already familiar with manufacturing and its challenges. New tech sectors such as biotechnology, wearable devices, and robotics, combined with easy access to the educated work force needed to produce them, has put the Bay State in a favorable position to spearhead the...

Public Housing Pushes Residents Toward A Better Life

Ray Mariano, executive director of the Worcester Housing Authority (WHA) and former four-term mayor of Worcester is on a mission to point individuals and families currently residing in public housing toward “A Better Life.” A Better Life (ABL) ABL is a program designed to encourage upward mobility for public housing tenants; challenging them to reach goals, become educated, secure employment, and to make better healthcare and financial choices. Though the program was voluntary when instituted in 2011, it has since been made compulsory for some residents within the WHA system. The ABL program requires one adult in each household to work or attend school for a minimum of 1,200 hours per year, which is an average of 23 hours per week. Support services to reach for these goals are provided through grants as part of the program. If the residents do not make an effort to abide by the program rules within three years, they face eviction. The disabled and elderly are not a part of the mandatory participation program, so they will not be compelled to leave public housing. The Cititzen’s Housing and Planning Association recently submitted a bill to the Legislature this past July, which would bring ABL to five housing authorities around the state. Some officials question the morality of making self-sufficiency programs mandatory. Mariano points to the statistics from the last three years as evidence of the program’s effectiveness. Only 36% of ABL participants were employed when the program first began. Since then, the percentage of employed participants has more than doubled. Additionally, the percentage of tenants going to school has tripled. ABL Opposition While political opposition can no longer prevent the implementation of mandatory participation, some tenants and community members are still at odds with ABL. Mariano, who grew up in Great Brook Valley—the same area currently targeted for the mandatory ABL program—is faced with the difficult mission of encouraging...

The Push for a Graduated Income Tax in Massachusetts

Raise Up Massachusetts, a coalition representing religious leaders, liberal community organizers, and unions, is advocating a constitutional amendment to raise income taxes on the state’s wealthiest residents. The proposal, which would affect those earning more than $1 million annually, would reportedly bring in additional revenue of up to $1.4 billion per year. The Massachusetts Communities Action Network, one of the coalition’s co-chairs, has indicated that the additional revenue would be earmarked for education and transportation, two areas where a number of needs have gone unmet over the past decade. Raise Up Massachusetts has previously lobbied the state legislature to raise the minimum wage and was successful with a ballot initiative that required employers to provide earned sick time to their workers. The constitutional amendment process, however, will take three years and will most likely face fierce opposition for anti-tax groups. All Massachusetts residents currently pay a flat 5.15% income tax that will reportedly decrease to 5%. The “Fair Share Amendment,” as it’s called by its proponents, would raise taxes to 9% for those earning more than $1 million annually. The 9% rate would only apply on income over $1 million. Approximately 14,000 tax payers would be affected by the proposal, which comes at a time when legislators are renewing efforts to require those with higher income to take a greater responsibility in the taxation process. The “Fair Share” moniker comes from the fact that low and middle income taxpayers contribute more of their disposable income under a flat-rate system than the most affluent taxpayers. Proponents say the increased taxes could fund road and bridge reconstruction, investment in the MBTA and other regional transit bodies, and education funding— particularly for early intervention and post-high-school initiatives. Since 2002, state funding for education has failed to keep up with inflation, resulting in cutbacks in many school districts. Opponents say that the proposal, if...

Massachusetts Tanning Ban Has Teens Seeing Red

Massachusetts legislators have initiated a push to make it illegal for teens under the age of 18 to use or operate tanning beds. A bill requiring tanning salon employees and patrons to be 18 or older, An Act Further Regulating Tanning Facilities, was passed without contest in the Massachusetts House last week. Ten states in the US have similar laws already in place, but the current campaign in Massachusetts has been met with some heated debate. Tanning: A Well-Known Risk There is no argument against the fact that sunless tanning under high-intensity UV bulbs has been proven to increase the likelihood of certain skin cancers. The risk for melanoma, the deadliest form of skin cancer, increases by 74% when individuals use indoor tanning beds. Studies show that nearly 30% of white female high school students use tanning beds, and 17% use them regularly. According to Senator James Timilty, co-chairman of the public safety committee, much of the UV exposure that leads to skin cancer is incurred in the childhood and teenage years. Diagnoses of melanoma have gone up 200% since 1973. Requirements of the Tanning Ban If successful, the Massachusetts tanning ban would require teens between the ages of 16 and 17 to be accompanied by a parent or guardian. Young adults under the age of 16 will need a “written prescription from a physician” in order to tan—a script not many doctors are likely to ever hand out. The contention surrounding the tanning booth debate centers on what many consider to be an overreach by the “nanny state.” Under the current state law, teenagers between the ages of 14–17 must present a written copy of parental consent before they are allowed to tan. Adherence to this regulation is predictably inconsistent. Not only can teenagers forge a note from Mom or Dad, but many establishments may not even bother asking for...

Will Massachusetts Solar Net Metering Caps Continue?

Solar energy is thriving in the commonwealth of Massachusetts, but the clean energy trend has slowed considerably due to the current cap on solar net metering. Contributing to the decrease is the imminent expiration of Federal incentives for installation of solar energy. Solar net metering allows customers who generate their own electricity from solar power to feed their surplus into the grid, calculated as a percentage of peak electrical usage. Solar Net Metering Caps Create Backlog The current caps particularly affect the MetroWest service grid, which is already buying back the maximum amount of solar-produced electricity produced by commercial customers required by state law. This situation has created a waiting list of commercial customers who would like to install solar panel systems but are delaying installation until the caps are raised to make the projects economically viable. Local business leaders have expressed hope that the solar net metering caps will soon be raised. In late June, the Massachusetts Senate voted 37–0 to raise the caps to 1,600 megawatts, up from the current caps of 1,000 and accounting for approximately 4–5% of the total energy generated statewide. The decision was passed as a part of a larger climate change preparedness bill. Another positive indicator is Governor Charlie Baker’s recent announcement that he plans to file legislation regarding the caps. Solar Detractors Speak Up Not everyone is in favor of the solar initiative. Associated Industries of Massachusetts has spoken out against the Senate’s move, indicating it could add up to $600 million to the total electric bills of Massachusetts customers who do not have access to solar power. The group has indicated a lift in the solar net metering caps would only put money back into the pockets of the companies installing the solar arrays. Solar advocates say that AIM did not take into consideration the benefits associated with solar energy and...

Will Aging Infrastructure Prevent Massachusetts Business Growth?

Massachusetts is known for its convoluted roadways and aggressive drivers. Its residents are no stranger to the aging infrastructure that transforms their daily commutes into heroic efforts of driving prowess and cunning. The roads are both difficult to navigate and dangerous to traverse— full of potholes and spans of structurally deficient bridges. Repairs are underway throughout the state on bridges, highways and tunnels, which only seems to add hours in detours and traffic as unsound areas are brought up to meet standards. While progress is being made, the work that has occurred has only made a small dent in Massachusetts’ transportation system woes, and is further affecting timely delivery of goods, commuting times, and the overall appeal of the state as a location to do business. The New England Council, a business advocacy group, has expressed concern over the congestion caused by road construction, as these type of inconveniences are often a factor in whether companies stay and expand or leave a region. At the moment, 20 tunnel projects and over 250 road reconstruction and resurfacing projects have entered the design phase, according to the Massachusetts Department of Transportation. Whether these projects will occur, and when, is another story. If approved, these repairs would happen in addition to projects like the ongoing initiative to repair more than 450 bridges. Initially a $3 billion project, it is now predicted to cost a total of $14.4 billion by the time the statewide repairs are completed. Massachusetts has been experiencing a notable increase in economic growth over the last five years, however businesses are concerned about the timely delivery of goods and services. In a fast-paced economy, meeting deadlines with a tight turnaround time is a key factor of success. Delays and detours ultimately affect the bottom line. The difficulties commuters faced last winter, between impassable roads, service delays, and cancellations of the...

What’s Really at Stake in the Verizon Union Strike?

Verizon unions along the East Coast are at their wits’ end with the company due to lengthy negotiations over cost cutting measures that they believe will threaten their job security. The old contract had expired as of August 1st, but no work stoppage has been initiated yet. If talks continue in the same manner, the unions have stated that they may have no choice but to strike. What’s at Stake? Unions are claiming that the top Verizon executives have been awarded a quarter of a billion dollars in the last few years and, as a whole, the service provider has made $18 billion in profits over the last year and a half. When bargaining started on June 22nd of this summer, Verizon proposed to raise health care costs by thousands of dollars, and threatened union workers’ job security by eliminating constraints on hiring non-union workers. It has been stated that the company wants to reduce overtime pay, as well as remove any restrictions on their ability to offshore union jobs. The company’s administration has expressed frustration that both parties have still not come to a concise resolution following a recent legitimate rebuttal to the union demands. Preparation Movements During Talks The Communications Workers of America and International Brotherhood of Electrical Workers, who represent about 37,000 Verizon employees, are not ready to back down. They claim that Verizon has been planning for this by training managers and hiring contract workers throughout the negotiation process, demonstrating that they are anticipating a long strike. But, for now, union workers will continue to be on the job despite Verizon’s apparent preparations. The Next Step Unions will continue to put the pressure on Verizon to decide on a fair contract soon. The negotiations for the last contract went on for 16 months, and both parties want to avoid a repeat experience. This agreement only...

Massachusetts Cracks Down on Misclassified Independent Contractors

Economic growth and the power of the Internet have ignited rapid proliferation of startup companies across the US. Services like Uber have typically been filling their ranks with drivers who are employed as independent contractors rather than full employees. However, in Massachusetts the law regarding the classification of workers as independent contractors is relatively strict, and it seems many of these new age business moguls have been cutting corners in the hiring process, which raises some interesting questions about the legality of their employment models. What Separates an Employee from an Independent Contractor? Business of all sizes tend to prefer independent contractors for several reasons. Workers hired as IC are not entitled to benefits like health insurance, overtime, and paid sick time or vacation; which saves the employing company a significant amount of money year over year. On the other hand, workers are willing to forego the usual employee benefits and sign on as independent contractors because their paychecks will not have taxes withheld by employers. The lack of immediate taxation has motivated the US Department of Labor, the IRS, and the state of Massachusetts to begin investigating misclassified workers with more zeal. Massachusetts requires independent contractors to fulfill three conditions in order to be classified as such: (1) the individual is free from control and direction in connection with the performance of the service, both under his contract for the performance of service and in fact (2) the service is performed outside the usual course of the business of the employer (3) the individual is customarily engaged in an independently established trade, occupation, profession or business of the same nature as that involved in the service performed. To qualify as an independent contractor, all three conditions of the law must be met. The problem is that many companies are hiring “independent contractors” who do not meet one or...

TechSandBox Targets Unusual Demographic of Entrepreneurs with the Techubator

Hopkinton may soon be the home to a new start-up program for entrepreneurs, inviting not at the expected demographic of up-and-coming Millennials, but rather their parents, to join the startup revolution. This bucolic haven, snuggled in a collection of small communities and serene lakes, might not seem like a likely place for business innovation— but it is already home to one of the area’s biggest tech companies, EMC, and start-up accelerator program, TechSandbox. Barb Finer, founder of TechSandbox, is currently in talks with angel investors to gather together the $1 million necessary to get the newest program up and running. The new program, called Techubator, would target entrepreneurs in their 40s and 50s, rather than the usual crowd of recent college graduates. The structure is loosely based on a similar company, Techstars of Boulder, Colorado. In exchange for a 6% equity, eight startups would be given 3 to 4 months of training, a co-working space, and an investment of $18,000. Employees for each venture are provided with educational programs and mentorship opportunities. TechSandBox understands the difficulties facing new business creators. Their Piranha Pond concept has already made strides in helping entrepreneurs from the Metrowest area over the past three years. The new Techubator initiative would specifically target middle-aged entrepreneurs in the process developing prototypes for tech products. Techubator will be designated to help a demographic that may not have the same advantages as the Millennial crowd when it comes to growing up in an entrepreneurial environment. Younger entrepreneurs have the advantage of being more at home with a typically younger crowd of business investors.  Some of the older entrepreneurs Techubator will target are launching start-ups late in life because they lost a job in another industry. Some are “reluctant entrepreneurs,”; people who have ideas but delayed pursuing investors because they don’t feel that they “fit in” with the typical...

Massachusetts Wealth is No Accident

This year has been a period of positive growth for the bay state. Unemployment has declined to a low of 4.8% as of March and current economic reports show that we are no longer in a recession. With just under 7 million workers at its disposal and a growing economy in many industries, the highly productive and profitable state of Massachusetts is set to achieve a new level in its wealth creation prospects. The resulting positive economic fallout will create a great deal of opportunity for development properties. The Executive Office of Labor and Workforce Development and the Federal Bureau of Labor Statistics shows that the unemployment rate of Massachusetts is steadily going down. This is a great sign for future development prospects. The state saw a rise of about 12,000 jobs in some of its most important sectors, including healthcare, education, hospitality, science, leisure and professional business services. The positive growth has not happened by accident, and state initiatives have been a huge boon in helping the state move forward out of the recent recession. Among other efforts by the state of Massachusetts, the ReadyMass 100 initiative is a very efficient way to promote site expansion opportunities for companies that are in the area. It is an initiative for companies, located anywhere in the US, who may be considering a move to or within Massachusetts. The site provides images and information regarding available commercial locations and highlights their most profitable features. The ReadyMass 100 initiative is a public and private partnership. Massachusetts created the effort in conjunction with MassEcon along with the private real estate community as well as many other regional development groups that are focused on the economy that is within the state. There are many other efforts that private companies have started that are undergoing separate RFPs for the state as well. Overall, the economic...

MA Judge Upholds Sick Time Law

Massachusetts District Court Judge Rya Zobel recently dismissed a complaint filed by two construction contractors, and six construction employee associations, seeking to challenge the Commonwealth’s new sick time law. The Massachusetts Earned Sick Leave law went into effect on July 1, 2015 following overwhelming support from voters in the fall elections. The legislation requires employers with more than 11 employees to provide up to 40 hours of accrued paid sick time to workers at their “same hourly rate” of pay. Employers with fewer than 11 employees are obliged to provide the accrued time as unpaid leave. An hour of sick time is accrued for every 30 hours worked under the new sick time law, accumulating to up to 40 hours annually. After 90 days of employment, sick time may be used for an employee’s physical and mental health concerns or similar concerns for a direct family member. Employers providing existing leave benefits, if equal to or more comprehensive than the requirements of the new sick time law, will not be required to change their employee benefits. Employers and employer organizations, including the Labor Relations Division of Construction Industries of Massachusetts, filed petitions with the court to challenge the law under concerns that it would change their existing union contracts. Citing the potential for pre-existing union negotiations would be negated by the change, they argued that the new state sick time law was preempted by the federal Labor Management Relations Act (LMRA). The LMRA, a federal collective bargaining law, was a core component of their argument against having to abide by the new rules for union employees. They contended that employees with benefits currently negotiated through a collective bargaining agreement should be exempt from the new legislation. In addition, the plaintiffs brought concerns regarding the definition of “same hourly rate” and posed situations under which the term could cause confusion...

Solar Debate Heats Up As Massachusetts Raises Net Metering Cap

The Massachusetts Senate convened last week and responded to on-going pressure by solar supporters with a vote to raise the solar power net metering cap. Net metering, part of the incentives offered to consumers to encourage clean energy development, allows utility users to sell their excess energy back to the grid. The cap represents a percentage of the peak energy usage and limits the amount of energy that solar power users can amass and sell back. Utility companies have argued against attempts to raise the limit, on the basis that consumers without solar power end up paying the difference. The decision to raise the cap was made to help facilitate the state’s goal of developing 1,600 megawatts of solar power by 2020. The solar energy stipulation was a component of an expansive climate change preparedness bill, sponsored by Senator Benjamin Downing, who believes that the passage of the bill would approximately double the cap. The current cap limits net metering to 4% of a utility’s peak load for private consumers and 5% for public consumers with no limit on residential. “There’s been a lot of discussion in the theoretical, but not enough in the actual, and the hope is that this is something concrete for people to react to, and I would hope that if the House or if the administration has a different way of going about this that they would put it on paper and we can get to what is our broadly shared goal,” Downing commented to reporters. The bill, which advocates the development of a plan for reacting to the potentially damaging effects of climate change and cutting back on greenhouse gas emissions, is headed to the House of Representatives. Its prospects remain unclear. Regional utility companies have proposed that Massachusetts legislators support the imposition of a minimum fee on all electrical bills to include...

Massachusetts Manufacturers Continue to Reshore Operations

The reshoring trend continues as Massachusetts manufacturers bring their operations back home. Companies, such as Energid Technologies Corp., are making the leap back to US soil to avoid external costs from unpredictable tariffs, foreign bureaucracy, and additional shipping charges. It seems the emerging economies of countries such as China and India have finally made outsourcing the less profitable option. Energid is in good company among more than 350 US businesses that have chosen to reshore their operations. The influx has brought nearly 40,000 manufacturing jobs back to the United States over the course of the last five years. 3,000 of those jobs have returned to the Northeast, with 600 to Massachusetts, according to the Reshoring Initiative. While these new positions still represent a very small portion of the available manufacturing jobs in the US, expert economists say they are a very positive sign of the industry’s post-recession rebound. Competitive production, automation and the complexity of today’s products have created a need for increased collaboration between designers, engineers, and production lines. Massachusetts remains a prime location for most manufacturing industries due to access to highly trained engineers and innovators from places like MIT. Despite this, there is still an observable labor shortage in the manufacturing industry as skilled workers are retiring with fewer young people coming in to take their place. Manufacturing resources like MassMEP are exploring initiatives to increase the number of motivated and highly trained workers coming into the manufacturing industry. MassMEP is currently teaming up with UMass Lowell to deliver the Advanced Computer Numerical Control Training Program in Massachusetts, which would value and merit to the industry while encouraging young individuals to get their certification and consider a career in manufacturing. Other resources are helping businesses overcome the initial expenses of re-locating their operations back to the US. MassDevelopment, a quasi-public industrial development agency, has helped several...

Massachusetts Economic Growth Is an Encouraging Sign for Businesses

At the recent Economic Summit breakfast, hosted by Randolph Savings Bank, economic expert Dr. Elliott Eisenberg confidently declared that the state of Massachusetts is not in a recession. Corroborating data shows that since the beginning of 2015, Massachusetts economic growth is moving at a steady pace that exceeds the national average. According to Eisenberg, the chances of a recession in the next six to twelve months is less than 5%. Although the change has not been a drastically positive one, the economy is still moving steadily forward. The trend in growth is a positive sign for growing businesses in the area, despite some factors that remain a point of concern. The number of experienced baby-boomers retiring from the work force, deteriorating fiscal conditions, income inequality, and the negative after-effects of a brutal winter could be troublesome if not resolved carefully. However, the rising trend in financial growth sheds a positive light on the future. There has been a significant increase in job opportunities thanks to thriving industries such as technology and software development. Many experienced workers are re-entering the workforce and a population boom has provided additional able bodies to fill available positions. For business owners, this is the perfect time to lay the foundations for growth. The Federal Reserve Bank of Boston has been kept under pressure to maintain current interest rates in order to nurture financial growth in the state. Experts anticipate that any raise in rates would be gradually implemented as inflation requires, as opposed to previous hikes that were made in an attempt to quell a boiling economy. The current financial atmosphere smacks of opportunity. Businesses considering expansion, either by hiring more personnel, constructing new venues, or investing in new equipment are being encouraged to act now. For those who are not quite ready to push forward, experts advise securing capital for growth objectives before interest rates...

MA Legislature Reaches Compromise on Tax Policy

Massachusetts Governor Charlie Baker reached a compromise with Massachusetts legislature and state business leaders last week regarding the earned income tax expansion. Presently, the state earned income tax credit is 15 % of the federal tax credit. The compromise will raise that percentage to 23%, or $1,459 per family. The agreement represents the first steps toward addressing income inequality in the commonwealth of Massachusetts. Gov. Baker has stated that the current goal is to set state credit to 30% of the federal tax credit, however the present bump in percentage will already cost the state roughly $72.5 million a year. Negotiations regarding how to pay for the earned income tax credit expansion have been ongoing for the past several months. Initially, House-Senate negotiators proposed repealing the FAS 109 tax credit, a tax break implemented in 2008 that would lower corporate taxes for publicly traded companies with assets across multiple state lines. The FAS 109 tax credit, representing $76 million a year in tax breaks, was passed to balance changes to corporate tax reporting requirements that required companies to pay more taxes on out-of-state income. A report submitted in 2009 predicted that over the course of six years, more than $533 million would be saved by corporations thanks to FAS 109, with $472 million going to only 14 corporations. However, with the impact of the recession, the legislature never put the credit into practice. Business leaders in the state opposed the repeal of FAS 109 to pay for the earned income tax credit expansion, stating that the credit had been made in good faith. The repeal, they argued, would be a break in trust between business leaders and the state; and would likely hurt the credibility and predictability of the state’s business climate. In addition, it would wreck havoc for companies that stood to lose years of anticipated credit in...

Piranha Pond Investing Opportunity—Entrepreneurs Latch On

Hopeful entrepreneurs and established businesses are always looking for more money to develop and expand. Finding investors through pitching to “angels” has become a popular way to make the connections necessary to learn the ropes and get the money necessary to make it big with a great idea. When it comes to finding investors, television has brought the idea of sharks to the forefront of the entrepreneurial mind, but it can be very hard to find the people in everyday life that have that kind of influence and backing. That is where the Piranha Pond investing opportunity comes in. It is a program developed to encourage new entrepreneurs and help them meet with the movers and shakers who have the power to make their dreams come true. Bringing Entrepreneurs and Sharks Together with a “Pitch Party” For the third time, the annual “Pitch Party” gives hopeful entrepreneurs the ability to talk with investors. For a $50 application fee, worthy business owners can submit a resume for their business online for the chance to connect with venture capitalists with the money to finance start ups and business expansions. The TechSandBox CEO, Barb Finer, worked with her team to create the Piranha Pond. Every year the program gets up to 40 applications from a nationwide pool of entrepreneurs. They are filtered through an approval process that determines eight finalists who will then have the opportunity to face a panel of five angel investors who, if their interest is peaked, compete to finance the business.  This year, the numbers were strong enough that there were nine companies chosen: Femme Forte, Enflux, SmartDiet, Intagora, Innoblative Technologies, ThinkInsite, Fremont Scientific, Rumi Spice and Ridgewing. How the Piranha Pond Works Applications are submitted via an online application form that allows entrepreneurs only a  one paragraph description of their idea to grab the interests of the investors reviewing the...

Worcester hotel development brings rooms, room for growth

Over the course of the next two years, Worcester will see the opening of at least three new hotels, bringing an estimated 360 new rooms to the city. The expansion of hotel space is vital if the city hopes to draw and retain tourist and convention revenues. XSS Hotels, a hotel development and management company, plans to open a 100-room Hampton Inn in early 2016. The company is also looking to build a 150-room Renaissance Hotel downtown to compliment the new CitySquare project. Homewood Suites will be breaking ground on a 110-room hotel located in close proximity to Union Station by the end of this year. While the new rooms are a good step forward, they are making up for lost ground. In 2010 the Crowne Plaza Hotel in Lincoln Square closed when the owners defaulted on a mortgage. Those 243 rooms were converted into dorms and classroom space by MCPHS University. Fortunately, the Crowne Plaza’s closing wasn’t due to a lack of customers. Today, seven hotels in Worcester provide 745 rooms. The need for additional lodging is displayed in the occupancy rates with 75% of beds full throughout the year, which is significantly higher than the 65% national average. This means that the 360 new rooms will help stabilize the market and keep any one establishment from being overburdened. Extra rooms also help increase the town’s capacity for hosting large events, creating a symbiotic relationship with Worcester’s growing number of conventions and tournaments. The DCU center boasts over 100,000 square feet of exhibit space for trade shows, conventions, entertainment, and private functions.  The adjoining arena has the capacity to accommodate anywhere from 12,000 to 15,000 attendees for concerts and sporting events, each one a potential customer of gas, food, souvenirs, and, of course, lodging. Developing more hotels in the area will help Worcester be a better host to...

California Superbug Trumped by Massachusetts-Made Device

An outbreak of drug-resistant bacteria at UCLA caused the death of several patients this past year. The source of the “superbug” was traced back to the use of contaminated endoscopes. Officials at UCLA stated that the endoscopes, by their design, are difficult to sanitize and that they followed the manufacturer’s cleaning instructions precisely. The superbug is called CRE,  is a family of germs that live in the human gastrointestinal tract and have evolved to be resistant to antibiotics. CRE does not always cause an infection in people in fact if someone has a healthy stomach the infection may not occur. CRE becomes dangerous—and potentially fatal—when it reaches the bloodstream or the bladder. It can even cause infection if it is exposed to an open wound on the skin. For patients with other conditions such as cancer, the risk of death increases. Unfortunately, this is precisely the kind of underlying condition patients receiving the endoscopies had at the time the device was used. Officials at UCLA have stated that the endoscopes are produced by different manufacturers and are all equally difficult to sanitize. Treating CRE is difficult due to its resistance to antibiotics and experts in infectious diseases state that drug companies have stopped producing new antibiotics because there isn’t enough money in the business. The best option, then,  is to prevent the spread of CRE in the first place. Medford based Langford IC Systems has developed a possible solution to the endoscope threat. The company has been working with Proven Process Medical Devices for more than a decade to create a new medical device cleaning system. The small nooks and crannies of a small device, like an endoscope, pose a serious challenge when trying to assure the removal of microscopic bacteria. Infections can fester and grow despite stringent sanitization processes. “The machine that we developed would clean, high level...

The Realities of Reshoring US Manufacturing

Offshoring—or outsourcing—is the practice of moving factories and jobs overseas. In the last 20 years, American companies have started sending manufacturing operations to countries with cheaper labor, fewer regulations, and more forgiving tax schedules. The phenomenon is familiar to anyone talking to tech-support in India, but it has also occurred in the manufacturing industry. Before 2000, US manufacturing grew almost as fast as the nation’s Gross Domestic Product (GDP) at ninety-four cents on the dollar, but since the turn of the millennium that number dropped to only 45%, until this year.  Currently, US manufacturing has grown faster than the GDP. The reason for this is called reshoring—returning factories to US soil. Many companies are finding good reasons to move their operations back to America, and the result is higher domestic manufacturing rates, and in some markets, more general growth. Companies have returned to the US to: reduce the complexity of their management and supply chains, avoid the costs and delays of shipping, ensure quality control, and to take advantage of some lower energy costs. Some corporations are not moving their existing operations, but instead opening new facilities. This geographic diversification insulates businesses against economic hardships like labor disputes, natural disasters, political upheaval, and more. Unfortunately, reshoring is not a marvel of American job-creation. Companies are choosing to move back stateside because it is the most economically feasible option. They are utilizing automation and optimization consultants to make their operations as lean as possible. The cost of healthcare and other benefits, coupled with government labor regulation, makes reshoring labor-intensive industries less likely to return. Those who do reshore have reported problems finding qualified employees, as too many applicants cannot pass drug screenings, do not have a grasp of basic math skills, or are unreliable. Bill Conerly, an economics expert writing for Forbes, sums it up perfectly when he writes, “The...

US Oil Fracking: Friend or Foe?

At least two decades of market uncertainty have kept Americans worried about the future of production costs and world market dominance. Fracking in the American Plains and middle regions have influenced a huge transition from complete reliance on near-Asian production, to the re-emergence of US-based goods and services. The boom in the Dakotas and other fracking regions has reduced the gap between costs of production between the US and countries like China to a paltry 5%. This means, from the popularity of new domestic oil production, that it is absolutely viable for companies to stay in America rather than export production elsewhere. Fracking has been good for technical- and labor-intensive jobs in the field, but it has been meeting significant resistance from state officials concerned about the health of their lands and their constituents—New York has banned fracking in the state because of its potential health risks. US Oil Fracking Is Our Foe Fracking has been the source of some controversy. Its supporters champion its financial benefits, while its critics emphasize its environmental and economic hazards. For example, in early June, roughly 3 million gallons of the potentially toxic saltwater produced in fracking pipelines leaked into a North Dakota creek that flows into the Missouri River. Also, Kansas, Ohio, and Texas have all reported that they are experiencing many small earthquakes that rated approximately three on the Richter scale. There is substantial evidence that these quakes are in fact related to fracking. There are also economic costs to consider, in addition to the problem of the “bust” following the “boom,” which North Dakota is now learning. While North Dakota has experienced a population boom, the development of the infrastructure has not kept up and officials are looking into “surge funding” to help pay for the cost of the expanding infrastructure—in one case, up to $1 billion. That funding is already in jeopardy because...

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