Economist: Rochester should invest in potential job growth
ROCHESTER - The economy has taken longer to bounce back slower than anyone wants, but the city can use the momentum from an international company filling 500 high-skilled jobs to help shape the future, a local economist told business and community leaders Tuesday.
Economist Brian Gottlob, of PolEcon Research, spoke to about 50 people in the Rochester Elk's Lodge during the sixth annual Economic Update Breakfast.
Gottlob, who lives in Dover, said he's always reluctant to explain the data he's seen about a community as he's looking at them from "a 20,000-feet perspective." He estimates the national gross domestic product - which represents the total value of all goods and services produced within a country in a year minus foreign investments - could grow about 2 or 2.5 percent this year, but the loss of $85 billion in sequestered federal funds could reduce the growth by a full point.
The relatively flat growth will continue to affect New Hampshire, which has struggled for some time, despite being ahead of neighbors in the past.
"We've gone from being a leader to a lagger," Gottlob said, adding New Hampshire companies may have stopped laying employees off, but the jobs have not returned yet. "The bleeding has stopped - now it's time for a transfusion."
Gottlob said the high cost of living - even though New Hampshire may be more reasonable compared to the rest of the region - and fewer job opportunities inhibit growth in the state.
"For most states, it's been a lost decade of growth," Gottlob said, adding while New Hampshire has some job growth, it was hit hard by the economy and has had a tough time recovering.
Gottlob said the Rochester area seems to be recovering slower than its neighbors.
"You really took a beating during the recession," Gottlob said, adding this is prevalent in areas that rely on manufacturing.
On the other hand, Gottlob said there is a shift of focus of a variety of factors - economic competition, activity and innovation - from the areas around Nashua and Manchester to the Seacoast.
"Being a part of that shifting focus is important for any community in this region," Gottlob said, adding Safran's decision to build in Rochester is a good sign.
Last summer, Albany International and Safran USA announced their partnership to build a new facility to produce next-generation composite aircraft components at Granite State Business Park in the city. While the groundbreaking is scheduled to take place in April, the companies also planned to bring their suppliers into the area, which will create additional opportunities for the Seacoast. Gottlob said this will bring innovative, cutting-edge technologies and require 500 skilled employees at the new Saffron facility. He asked how the city can use this opportunity to encourage more growth.
"I think there's a great opportunity here," Gottlob said. "You just have to get over the hump.
"At a whole, Gottlob said small businesses - those which have less than 50 employees - haven't taken part in the recovery process yet since they suffer from a lack of confidence as consumers are also reluctant.
"They're not hiring because they don't see the opportunity," he said, adding small businesses rely more on the local community rather than worldwide markets.