Metro Economic Outlook: Boston With a sturdy foundation of education and health care, and a jobless rate that’s frequently below the national average, Boston’s economy has been on solid ground for quite some time. However, more work needs to be done to sustain the recent growth. “There are three pillars we look at,”said Carolyn Ryan, VP of research and data analytics at the Greater Boston Chamber of Commerce. “First is transportation, because we need to do a better job of getting people to work and on time. Second is workforce development, in order to meet the needs of our employers, and third is the housing issue. Boston has very high prices, and it makes ‘getting in the game’ very challenging for many residents.”
BOSTON METRO: VITAL STATS Total working age population: 2,960,588 out of a total population of 4,774,321 Number of households: 1,782,655 Consumer price index: 261.675 (goods and services that cost $100 in 1982-1984 cost $261.68 in November 2016) Percentage of local residents with bachelor’s degrees: 25.2 With graduate or professional degrees: 20.8 Workers in STEM industries: 39 per 1,000 residents Sources: U.S. Census Bureau (2015), U.S. Bureau of Labor Statistics (November 2016), American Institute for Economic Research (2015)
Last updated on 1/1/2017
Unemployment rate 12 10 8 6
4.6
4
2.4
2 0 U.S.
Boston Metro
Source: U.S. Bureau of Labor Statistics (November 2016)
Aside from the education and health care sectors, other economic drivers for the Boston metro region – which spans five counties in Massachusetts and two counties in New Hampshire – include financial services and tourism. The life sciences industry also has a significant local presence. Boston-based entities have received nearly $29 billion in funds from the National Institutes of Health since 1992, according to a report from the Boston Redevelopment Authority. In order to identify more job opportunities for students at the 80-plus college and universities in the region, the Internship Collaborative – a joint effort of the Boston chamber and the Federal Reserve Bank of Boston – created Internhub.com, a free website designed as a centralized platform to match college students with internships available at local employers.
Unemployment and most CPI data updated monthly. Other data updated once annually as it becomes available.
“As far as the labor force, there’s more of a focus on retaining the recent college graduate and millennials,” Ryan said, “as well as fostering the innovation sector and entrepreneurial sector. People identify them as key areas for growth.”
Labor force makeup Government
307.1
Other services
100.6
Leisure and hospitality
237.4
Education and health services
558
Professional and business services
445.4
Financial activities
183.7
Information
77.1
Trade, transportation and utilities
417.3
Manufacturing
189.4
Mining, logging and construction
102
Total nonfarm
2618 0
1,000
2,000
3,000
Some of the Fortune Number in thousands 500 members that call the Boston Source: U.S. Bureau of Labor Statistics (January 2016) region home are financial interest at District Hall, a high-tech incubator facility for startState Street, medical device company Boston Scientific, up companies. and property and casualty insurer Liberty Mutual. Much of the City of Boston’s recent development activity has focused on its waterfront. Drug manufacturer Vertex Pharmaceuticals opened a new 1.1 million-square-foot headquarters complex there in 2014. Several local entrepreneurs have also set up shop
Working age categories 292,058, 10%
344,989, 12%
330,757, 11%
The latest large-scale development in the waterfront region, called One Seaport Square, broke ground in November 2014. It will include two towers with a total of 250,000 square feet of retail space on the lower levels and 832 luxury apartments. The project is expected to be finished in 2017 and is part of a broader 23-acre redevelopment of that section of Boston. It will be joined in 2018 by General Electric, which will move its headquarters from Connecticut to Boston and bring 800 jobs. 20 to 24 25 to 34
702,894, 24%
35 to 44 45 to 54 55 to 59
688,946, 23%
60 to 64
600,944, 20% Source: U.S. Census Bureau (2015)
“There’s a lot working in our favor,” Ryan said. “We’re lucky in that we have higher education and medical institutions. We’re educating people and we can keep them here. With professional services and biotech, they are typically well-paying jobs and that trickles down to the rest of our economy.”
Last updated on 1/1/2017
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Employee Benefits Data Employers offering consumer-driven health plans 25%
21%
19%
20% 15% 10% 5%
Employers in the Boston metro area are slightly more likely to offer consumer-driven health plans compared with the national level, by a margin of 2 percent.
0% U.S.
Boston Metro
Employers offering domestic partner benefits 70%
61%
60%
50%
50% 40% 30%
They are somewhat more likely to offer domestic partner benefits, by an 11 percent margin above the national level.
20% 10% 0% U.S.
Boston Metro
Source: SHRM Health Care Benchmarking Database (2016)
Retirement Employee 401(k) participation rate 80% 70%
66%
68%
U.S.
Boston Metro
60% 50% 40% 30%
The Boston metro area workforce’s rate of employee 401(k) participation is slightly above the national level, by a margin of 2 percent.
20% 10% 0%
Source: SHRM Retirement & Welfare Benefits Database (2016)
Last updated on 1/1/2017
3
Income and Turnover Data Overall turnover rate 25% 20%
19% 16%
15% 10%
The Boston metro area’s workforce has a lower turnover rate than the national level, by a margin of 3 percent.
5% 0% U.S.
Boston Metro
Source: SHRM Human Capital Benchmarking Database (2016)
Median household income $90,000 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0
$78,800 $56,516
U.S.
Median household income in the Boston metro area is significantly higher than the national level, by more than $22,000 annually.
Boston Metro
Source: U.S. Census Bureau (2015)
Per capita income $45,000 $40,000 $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0
$41,334 $29,979
U.S.
Per capita income in the Boston area is also much higher than the national level, by more than $11,000 annually.
Boston Metro
Source: U.S. Census Bureau (2015)
Last updated on 1/1/2017
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Top Management Salaries Data Median salaries, top management Median salaries for top management level employees in the Boston area are typically on par or considerably above the national median.
$322,100 $322,100
Top legal executive
$355,400 $280,500
Chief information officer
$291,800 $232,500
*Top HR executive
$384,300 $348,600
Chief financial officer
$850,000
Chief executive officer
$650,000 $0
*Without labor relations experience
$200,000 $400,000 $600,000 $800,000 $1,000,000 Boston Metro
U.S.
Source: Willis Towers Watson Data Services 2016 Survey Report on Top Management Compensation
Project lead: Project contributors: External contributors: Copy editing:
Joseph Coombs, Senior Analyst, Workforce Trends, SHRM Shonna Waters, Ph.D., VP of Research Carolyn Ryan, Greater Boston Chamber of Commerce Katya Scanlan, copy editor
This report is published by the Society for Human Resource Management (SHRM). All content is for informational purposes only and is not to be construed as a guaranteed outcome. SHRM cannot accept responsibility for any errors or omissions or any liability resulting from the use or misuse of any such information. © 2017 Society for Human Resource Management. All rights reserved. Printed in the United States of America. These materials and the data contained within them are copyrighted by SHRM, another copyright holder (where noted), or are government-owned. SHRM hereby grants permission for users to copy and use these materials and the data contained within them only if proper attribution is given to SHRM (or the noted copyright holder) as the source of the material. For more information, please contact: SHRM Research Department 1800 Duke Street, Alexandria, VA 22314, USA Phone: (703) 548-3440 Fax: (703) 535-6432 Email:
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Last updated on 1/1/2017
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