As I put pieces together on my harbor puzzle, the picture slowly comes together. Just like the Maine puzzle I’ve been looking at. Little pieces here and there, seemingly disconnected from one another, but still part of the same puzzle. One of the pieces I’ve been gnawing on is the piece about Maine’s labor market and what the employment future of the state looks like. The Feds released the jobless rate for January on 1 February, and it doesn’t look at all good. We seem to be drifting from an economy driven by production, which is where real growth comes from, to an economy focused on service type employment, such as retail, food and hospitality, call centers and so forth. While these categories provide employment opportunities, they certainly do not produce income. They only exchange income from one sector of the economy to another.

This is one of the areas I fear Maine is seriously delinquent in, providing jobs that produce an income for the state. While there is a need, and in fact a strong desire in the state of Maine to drive the tourism industry, I don’t believe that it should be a major, let alone primary, factor in the states’ economic picture. Gross domestic product GDP is one of the overlying factors many people who deal with demographics use to determine the viability of an area for possible location in. Maine’s GDP sucks, by the way. According to Fed statistics, our GDP for 2005 was 45 billion dollars. We were ranked at number 43 in the nation.

One of the issues that keeps cropping up, and rightly so, is the potential for economic salvation in the Moosehead region with a proposed development. Some folks seem to think I am against progress because I oppose this plan as proposed by Plum Creek and The Nature Conservancy. That really isn’t true. I oppose the plan because I feel as though it leaves too many questions unanswered. There are too many what if situations that have not been addressed. Granted, a lot of small business opportunities will be created from the initial push of construction, but will those businesses be sustainable? We must remember that the hopes and dreams of this economic revival are pinned upon two very unstable market segments. Real Estate and Tourism. We look at Real Estate and say, hey, everybody needs a home, do you know anybody who doesn’t live in some kind of home? That’s very true, but the market to be opened in the Moosehead area is not a home market. It is a vacation lodging market.

Fresh on the heels of the subprime mortgage market freefall, home prices across the nation are declining. New homes are being put off, and lending is tightening its belt. Unemployment is up, as are the costs of living. Food costs will be taking record jumps in retail prices during the first quarter of this year, and later in the year many other items will be following in suite. A recent article told of how the costs of doing business in China are increasing to keep pace with their own troubled inflationary economy. Cheap Chinese imports will become a thing of the past.

So what provides the stimulus for this dream of a burgeoning economy in the great Northwood’s? Let’s take a look at the proposal and see what may happen. In a nutshell, we are looking at a proposed nearly 1000 regular homes, a couple of resort areas and some accessory businesses, such as gift shops, c-stores, and the like.

To start with the homes, there have been no contracts to buy presented as yet. Which is understandable, as plans haven’t been approved. But in many developments across the nation, building lots are pre-sold all the time before final approvals are made for the permitting process. As to being an area for summer homes, we are looking at some problematical issues here. The biggest issue is going to be the geographical location of the development.

Moosehead is a long way from civilization, and at over three dollars a gallon for fuel, people are not going to look favorably on the journey every weekend. By the time this project gets rolling, provided it’s even approved, fuel will probably be closer to four dollars per gallon, perhaps more. The downturn in the housing market will lower secondary home prices across the country, making more accessible resorts more appealing, especially as there are many areas already established in the market.

Greeneville has an airport, but that will be causing problems as long as the state of Maine insists on charging sales tax to out of state plane owners if they land their planes in Maine. Some tax bills sent out exceeded $100,000 for the owners. How are potential homebuyers going to react when they learn that they may have to pay a sales tax on a plane they didn’t even purchase here? I’ve read comments from different articles where some people don’t think that it’s a big deal, as only the rich can afford a plane, and they deserve to be taxed. Of course, the claim is not a valid one, but that’s what some people believe.

But at any rate, all of the hopes and dreams are staked on horse in the race, and nobody is even 100% positive the horse can win. Provided approval is given for the project to proceed, how many of these homes are actually going to be built? I don’t believe all 975 residence structures will be built within the first five years. And then there are the resorts. What kind of resorts? Seasonal or year round? Not much has really been said about them. What are we actually looking at in terms of employment for the Greeneville and Moosehead area here?

Well, we are looking at two types of employment here. Long term on the one hand, and short term on the other. For the short term, we are looking at construction jobs, both residential and commercial. Construction pays pretty good, comparatively speaking, but there are a couple of caveats attached to the industry. One is that it is somewhat of a seasonal nature. Layoffs are high during the winter months in the trade. The second one is that construction is based on the housing market. We need to bear in mind that the economy is in a very weakened state at this time, and it is because of the housing segment of the economy that we are in this state.

For the long term employment situation, what will be offered in terms of employment. What the proposal offers is food and hospitality employment, and retail. Neither of those two segments pay very well, and neither are well known for providing full time positions. Service jobs offer very little in the way of production of real income. And that’s where one of Maine’s biggest problems lay. Right smack dab in the middle of wonderland. We’ll continue this trail next time.


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