A new report from the trade group for the state’s biotech industry says Massachusetts lost jobs in the factories that make the drugs researched in the state’s R&D labs. iStock photo illustration
The reminders are all around us that Massachusetts helped give birth to the Industrial Revolution.
They can be found in the old red brick mills and factories that dot the landscape, some now transformed into fashionable condominiums and apartments.
That first wave of industrialization in the 1800s was based on the cheapest fuel source around – the natural power of the mighty Merrimack and Blackstone rivers, not to mention other waterways.
A second wave of industrialization based on electricity generated by coal, oil and other fossil fuels swept the region in the late 19th and early 20th century, sustaining the Bay State as a major production hub right through World War II and into the post-war years even as its original textile mills closed and their operators moved to the South.
New Report Shows Shrinkage
The heyday of industrial Massachusetts, though, has long since passed, with manufacturers their operations to other parts of the country and the globe as well with lower labor costs.
Manufacturing jobs peaked in the mid-1980s, when 676,000 people, or 24 percent of the workforce, worked in factories large and small, according to a 2002 story in the former B.U. Bridge newspaper.
Today, that number has fallen to 250,000 workers, or 6.7 percent of the state’s workforce, according to the National Association of Manufacturers.
However, gains in biotech manufacturing in recent years have been a small but growing bright spot in an otherwise gloomy picture in a state that was once an industrial pioneer.
A Boston Globe story last year cited 10 new biomanufacturing plants that had either opened or were under construction in communities ranging from Worcester to Bedford.
And jobs in the state’s biomanufacturing sector surged 25 percent in Massachusetts from 2019 through 2022, coming in at just under 10,500.
But a new report by the Massachusetts Biotech Council should raise concerns, pointing to a potential slowdown in biotech factory jobs after a few years of really strong growth.
Jobs in the highly specialized manufacturing sector fell last year by more than 2 percent, according to the trade organization.
Plans for a half-million-square-foot biomanufacturing and life sciences complex at Suffolk Downs have been delayed, while a Chinese contract manufacturer has, for now anyway, paused construction of a nearly 190,000 square drug factory in Worcester in June.
Fate of $1B Aid Package Unclear
For its part, MassBio is citing the new data to bolster its efforts to convince the Legislature to give a green light to the Healey administration’s proposal to spend $1 billion on subsidies for the industry over the next decade.
The subsidies are needed, MassBio says, to help local biomanufacturers compete with rivals in lower-cost states.
With some of the highest electricity rates in the country, the cost of power is a key factor in making the Bay State a more expensive place to make all sorts of things, not just new drugs.
Massachusetts has a really good thing going with its booming but so far R&D-heavy life sciences sector so the $1 billion, while hardly chump change, will likely be money well spent.
But the governor and legislative leaders shouldn’t stop there.
It’s high time to take a hard look at the state’s high power bills and how they might be holding back not just plans for new drug factories, but driving away other manufacturers as well.
That would seem like a commonsense thing to do.
Scott Van Voorhis
Power Costs Drive Subsidy Need
But as it stands now, the state’s efforts to decarbonize its power sector have effectively sucked up all the oxygen in the room, with the high cost of electricity in Massachusetts not deemed worthy of discussion amid the need to pay for new wind farms and power lines.
It’s time to change that and look at all the factors that have driven power bills in Massachusetts to sky-high levels.
For example, state government and the major utility companies have been scrambling to ramp up renewable power production.
But there has been little or no discussion about the cost of these subsidies to ratepayers, including manufacturers.
These are certainly important efforts.
But that certainly doesn’t mean they couldn’t be managed more efficiently, or in ways that might put less of a burden on factories and industry.
It’s time to open the books and take a good hard look.
Scott Van Voorhis is Banker & Tradesman’s columnist and publisher of the Contrarian Boston newsletter; opinions expressed are his own. He may be reached at sbvanvoorhis@hotmail.com.
