Massachusetts Employment Growth 1996-2006: Effects Of Industry Performance And Industry Composition

This paper examines the effects of industry performance and industry composition on overall changes in Massachusetts employment in the period 1996 to 2006. Through 2000, Massachusetts enjoyed strong economic expansion. Around the time of the nationwide recession of 2001, however, the Massachusetts economy experienced a relatively severe setback, and the state has yet to regain as many jobs in the ensuing expansion as it lost in the downturn. The paper finds that Massachusetts industries generally experienced slower employment growth than their national counterparts in the early 2000s. The highest-flying industries of the late 1990s did "Give back" some of their gains in the early 2000s, but this fact does not explain the Commonwealth's overall employment trends relative to national trends.