Maine is one of the oldest states in the nation. This is a problem for many reasons. Older populations mean fewer workers and larger demographic dependency, straining the younger generations from being able to find their footing. As highlighted in the most recent population outlook, put out by the Maine State Economist in April of this year, there is, thankfully, a light at the end of this lonely tunnel. More people are “migrating” to the state of Maine than has been seen in the past 20+ years. With them, these young families bring a strong labor force, domestic investment opportunity through increased tax revenue, demand for low to mid-income positions, and many more positives to our slowly decaying economy. However, we face a new issue as their numbers increase. How do we convince them to stay?
For time in memorial, the ability to attract solid and working-age individuals to your “society” has been paramount to building a healthy civilization. To do this, leaders have diversified their tactics from tax breaks to public employment and even kidnapping. To this day, these same tactics are being used to entice those fleeing the “less desirable” states for those with more opportunity. This can be seen as many leave the North-West portion of the US to escape the tragic and deadly fires that plague the region in search of more “stable” environments. At the micro-level, this same issue fuels new business decisions, determining which regions/municipalities reap the benefits of this boom in population.
As someone who has lived and worked in the Brunswick/Topsham area for the past 20+ years, this battle has been evident in my everyday life. Throughout my life, I saw a fascinating shift in population, as well as new business development, leading to more robust local investment. The reasons for this trend are worth a blog post of their own, so instead, let’s focus on the broad stroke outcomes this leads to.
Starting in the 1980s and continuing into the early 2000s, for reasons such as tax benefits and local development, new businesses began to take foot in Topsham rather than the already crowded Brunswick. With a growing population, these businesses found a large workforce to fund their ventures, as well as new housing developments that offered a great equity sink for these young entrepreneurs. In light of this shift, local tax revenues began to increase, and investment was demanded in response. With many young families coming to start, work in, or commute to local positions the obvious number one need was an educational service to ensure these parents children were given the best and brightest education, and that they didn’t decide to settle in the next town over. The Mt. Ararat Middle School (a part of the larger MSAD #75) was constructed in 2001 in light of this new demand. As more new families continued to move into the area thanks to the Brunswick Naval Air Station, the government also began to develop more housing opportunities for those employed on the base and their families.
Then in 2005, the unspeakable happened, the Federal Government announced the closure of the Brunswick Naval Air Station. With the departure of hundreds of families and thousands of individuals, the future of this robust development came into question. Not only were we losing a significant source of local population growth (a part of the reason that the Brunswick area has amounted to such a hub of the population can be tied directly to BNAS, as well as the presence of local institutions such as Bowdoin College), many of these families teenage children stayed in the area after high school, helping to supply the growing demand for labor. With labor demand becoming strained and Real Estate no longer growing in equity, many local families began to debate whether they could retain the quality of life they had grown to enjoy during these ‘golden years. Something had to be done, and Brunswick proved to be the first to act.
Thanks to the acquisition of the significant new developmental center of the former BNAS, Commercial Real Estate once again become “cheap.” In light of this shift, local developers shifted their gaze from the sand dunes of Topsham to the pre-developed streets of Brunswick (to this day, large commercial plots sit vacant next to the Topsham Fair Mall, still listed on the market today). However, in light of the reality that many of those currently existing in the labor force had begun to move to the “up and coming” Topsham, the need for cheap housing was paramount in supplying these incredible opportunities. By repurposing many of the existing townhouses into rental units and developing new ones, the lower-mid income families once again found a home in Brunswick.
Today, the results are as clear as day. Boasting dozens of new businesses, hundreds of jobs, and tens of thousands of square feet in residential space, Brunswick Landing continues to operate as an economic driver in the area. When seeing how the shifts in business/human migration can so drastically affect the quality of life in these areas, the question of why one place wins over another becomes paramount to ensuring healthier and more robust communities in the future. As Maine continues to see an influx of new citizens, often coming from areas with previously developed services similar to Portland and Brunswick, how do we make areas that desperately need new citizens to encourage further development? The story of Lewiston-Auburn may help to shine some light in this area.
As Maine’s second and fifth largest cities, Lewiston and Auburn have shown what happens when businesses once again leave an area, though the people do not. For generations, and once again thanks to a river, the towns operated mills and other manufacturing services that supplied steady jobs to their populace. Being able to start at a young age, many families would see generations work through the same mills. In response to this planted and well paid population, other services began to move into the area. The remnants of this development can be seen in the numerous historical and gorgeous brick buildings that line the riverfront on both sides. However, as those manufacturing industries began to leave (similar to how they did in Brunswick/Topsham) the people left behind found few options that could pay them similarly to the former mills. As these individuals lost their buying power simultaneously with the Real Estate becoming less attractive to investors, many businesses started eying towns closer to the scenic Route 1, and so began another mass relocation closer to the coast.
However, they left something behind. Much like Topsham in the ’90s and early 2000s, the infrastructure developed during this time remained. From entire historic districts to expanded opportunities for new construction, the Real Estate of the LA area slept, waiting for the shift we see today. Now, as Real Estate once again becomes expensive in the Brunswick area (and towns like Topsham show little new opportunity), investors have begun to shift their sites to these previously forgotten treasures. However, this influx of private funds would never have come without a pre-existing population and easy opportunity for profits that sustains it. Therefore the following question in our chain of thought has to be asked. If we need both a healthy labor force and ample opportunity for private investment (i.e. profit), how do we achieve this balance in areas such as Orono or Old Town? These two towns are similar in many ways to Brunswick/Topsham but lack the fundamental difference that spurs this type of economic growth, a healthy private-public relationship that fosters the quality of life that convinces new families to stay.
As seen in the new schools, roadways, and local council involvement such as the Brunswick Downtown Association, these types of public service-focused investments foster the services that young families look for when deciding where to settle for their first home. By failing to encourage these systems, towns as diverse as Orono (inner college town) and Harpswell (coastal retirement community) deprive themselves of the sustained economic growth they are poised to take advantage of. This lack of investment can arise for many reasons. Whether its because the towns residents desire to keep their “cost of living” cheap by lowering taxes (ignore the costs of the numerous negative externalities this causes) or because there is a lack of a central order. No matter the reason, the answer to overcoming this issue is simple. Invest in yourselves and you will see growth, don’t and you’ll see yourselves fall behind.
One great way to overcome this problem is to look at how high school educated individuals may foster a healthy career in your town. For instance, wastewater management is an issue that is present no matter where you live. Many positions within these facilities do not require a college-level education, therefore allowing opportunities for young individuals to stay and grow in the area. The issue, though, is that these jobs are scarce. I can remember when I was at Orono around 2015 and had a professor explain to me about the up and coming opportunity in waste management (some higher-level positions require biology degrees to help understand the more intricate processes of the plants) as many of those in the labor force were nearing 60 and would be retiring close to my graduation date. While this did not excite me at the time, the impact of these positions is not wasted on my more economically focused mind.
To help create these types of jobs, the public sector has to step in. It would be hard to imagine a private actor going door to door asking to process your poop for a monthly cost; therefore, we should identify other areas where these types of “market failures” exist and use these opportunities to help create a healthier labor market for those most in need. In my mind, this could be local energy management to create energy independence for isolated communities, public planning boards to direct investment, development of public transportation to encourage easier migration to less developed regions, or even new public housing in similar models to what we’ve seen work privately for the Brunswick Landing. Through these and other hard investment projects in the state, we can help foster the movement of these individuals and businesses to encourage them to explore and settle in the areas that need them the most. By promoting local growth these investments will pay for themselves as long as the rate of tax revenue is above the annual interest rate. This means that as long as r-e<0 (which it most often is, as proven in numerous economic journals), the local investment will not only pay for itself but even turn a profit in many cases. By increasing in-migration you not only increase tax revenue from new labor, but also from the development costs of private investment and increased domestic demand driving up sales tax revenue. With these massive increases in public funds we can see this type of growth compound, that is as long as we continue to encourage this development well into the future. It’s those that ignore the needs of their populace that see the exodus of their citizens, we must avoid this at all costs if we wish to see this beautiful and unique state compete in the later parts of the 21st century.
My Maine Musings 