In his first year as head of one of the state’s most influential business groups, New Hampshire’s Business & Industry Association’s president Mike Skelton took a tour of the state, visiting his members and learning about the biggest challenges they face today.
He told the Globe what he learned why the housing crisis is the biggest barrier to economic growth in the state, and how Manchester is the city that would never die.
Skelton was born in Manchester and studied political science at Saint Anselm. He was the president and CEO of the Greater Manchester Chamber of Commerce before taking over as head of the BIA.
Q: You spent much of your first year in this role traveling around the state talking to businesses. What did you hear from them?
It still doesn’t matter what type of business I’m visiting, what location they’re in, what industry they’re in. Workforce availability is the top challenge facing our business community, and I expect it will be for the foreseeable future.
In New Hampshire, we’re at 98.5% of our workforce from pre-pandemic until now. So that 1.5% gap is equivalent to around 15,000 workers. But when you factor in the growth that we’ve had in jobs because the economy has been relatively good, we’re some multiple of that short of workers to meet demand with a historically low unemployment rate.
That has real ramifications on our business community. Many businesses have had to reconfigure their operations, their hours of operations, their hiring plans, their plans for expansion. So workforce availability is an inhibitor on future growth, and we need to have a strategy to address that.
Q: The BIA has a powerful voice at the State House. What issues are you focusing on when it comes to advocacy this session?
Housing and child care are two important policy issues that we’re very focused on this year. I expect for years to come that will have a direct correlation in connection to workforce availability.
The other priority that I would cite is cost of energy. It’s a regional challenge that’s holding us back. The manufacturing members we have are the most energy-cost sensitive of any business. Their electric bills are the highest of anyone, and they want to expand here. Energy is one of those things where we really fall behind compared to other parts of the country. That’s also something you can’t change overnight. It takes long-term planning in decades, really.
Q: What do you think the state should do to address the high cost of energy?
Nothing is simple in energy but to simplify it, in a nutshell, we need to build more stuff. The type of energy we are going to be building is largely going to be renewables. It has the kind of environmental attributes that we would like, but it’s increasingly more economically competitive.
There are challenges with siting and that’s been a focus of ours at the legislature, looking at some siting reform efforts. We as a region, as a state, need to understand that we need to get better at building more stuff quicker if we’re going to meet those energy challenges and bring down costs.
Q: You mentioned the housing issue, which obviously is a huge theme at the State House and beyond. What do you think is the role of businesses in addressing that?
Housing matters to our economic stability and economic growth. And I have encouraged our members and business leaders to speak up and give voice to that. We ask members to tell legislators about their experience and the real world dynamics when they’re trying to hire.
I talked to a manufacturing company that is trying to hire 100 new workers to expand their facility and they’ve grown their wages from $18, $19, $20, $21, $22, to $23 an hour. They’re doing all they can but for that type of job, you can’t be asking someone to drive from more than an hour away.
Across the economic spectrum, housing matters, and we need basically more of all of it. I think the most important thing that the business community can and should do is making sure there is a very strong connection in the minds of legislators between more affordable, more accessible housing options and having a balanced housing market and economic vibrancy.
Q: What’s your take on what the state should do to address the housing crisis?
There’s no silver bullet. We’re at least 20,000 housing units short of what we need for a balanced housing market. There is just no way that you can build that many housing units quickly, nor should we.
We need to have a system where we start building more units to chip away at that gap. And they need to be geographically spread and shared among the whole state so we’re meeting the needs of all of our communities and all of our residents and potentially future residents.
Our mission at the BIA is to ensure that New Hampshire is the best place to do business. Overall we have a very favorable business climate. Workforce availability is that one thing that’s really hurting us right now.
Q: Let’s end on a fun note. You’re originally from Manchester and spent years working at the Greater Manchester Chamber of Commerce. What are your Manchester recommendations?
The thing that really separates Manchester, what makes it special, is its unique history. It really is one of the only post-industrial northern northeast mill towns that has preserved and repurposed its legacy. The mill yard buildings you see today are only 30 percent of what was once there. It was at one point the largest textile manufacturing center in the world. So go to the Manchester Millyard Museum.
Manchester is the city that would never die. It failed, with the closure of Amoskeag Manufacturing, but its leaders stood up and saved the mill yard and then preserved it. Now, it’s been repurposed into a new center of commerce and now recreation and residential living.
Palace Theatre. I also have the pleasure of serving on its board. It’s one of the most successful historic theaters in America. At one point Manchester had something like 17 historic theaters, but over time they closed or were rebuilt into something else. But the Palace remains and it’s just an incredible institution.