Through the highs of the real estate boom and the lows of the Great Recession that followed, employment in Massachusetts never reached the peak it hit in February 2001, an era of wild-eyed optimism that ultimately ended in the collapse of the dot-com bubble in the technology industry.
At least not until now.
Massachusetts employment hit a record high in March, with about 3.4 million people holding jobs.
This time, there is reason to think that the recovery could be a lasting one, said Northeastern University economist Alan Clayton-Matthews.
“We didn’t pass this [jobs] milestone because of an irrationally exuberant bubble,” he said, “but because of steady growth that looks like it’s on a trend to continue.”
More than six years after the 2008 recession, Massachusetts’s recovery has been marked by slowly improving unemployment and consumer confidence. The state reported Thursday that unemployment fell for the third month in a row to 6.3 percent in March from 7.1 percent in December. In recent years, the Massachusetts rate has generally been below the US average, which was 6.7 percent in March.
William Guenther, chief executive of Mass Insight Global Partnerships, an organization that seeks to shape public policy around economic development, said the recovery has been slow but spread out over a more diverse range of employment sectors.
He said Massachusetts has a “balanced portfolio” of employers, noting that the economy has diversified since the 1990s. Technology is still an important economic driver in the state, he said, but there are also more life sciences and pharmaceutical companies. The state’s solid health care and education sectors have helped the state weather economic downturns, and government has also done more to promote and partner with bedrock institutions such as Harvard University and the Massachusetts Institute of Technology, which it had generally ignored before 2001.
“I don’t remember any effort to draw the major universities into economic development,” Guenther said. Today, “in China, the single most important brands Boston has are Harvard and MIT. More than any other company.”
Neil Sullivan, executive director of the Boston Private Industry Council, which brokers jobs between local employers and city youth, said the record high employment masks the unevenness of the job gains statewide.
Sullivan said the jobs growth doesn’t appear to be helping the number of people in Massachusetts who have been unemployed for six months or more in Massachusetts, which has not yet returned to prerecession levels.
Unemployment among teens and youth in their early 20s also remains at crisis levels, he said. In the go-go 1990s, youth unemployment was near zero and he could find 10 teens jobs within a matter of hours, sometimes even after they had been fired from multiple jobs.
“Look at the stock market, wealth has recovered,” Sullivan said. “The labor market has recovered for older populations, but it is not addressing the needs of those coming of age.”
The employment milestone also does not reflect the fact that the state’s population has grown as the state struggled to regain jobs it lost a decade ago, said Daniel Hodge, director of economic and public policy at the University of Massachusetts’ Donahue Institute.
The unemployment rate also does not reflect the number of discouraged people who have given up their job search. (They are not counted in the most widely used official Department of Labor unemployment number.)
Unlike states that have benefited from gas and oil export booms, Massachusetts has been successfully launching startups and undertaking efforts to stanch the loss of manufacturing jobs. New life sciences companies and technology startups are also incrementally adding new workers all the time, putting Massachusetts on what appears to be a sustainable path of growth.
“To me, it’s not cause for celebration,” Hodge said of the employment record. “But it is cause for optimism.”