AUGUSTA, Maine — Employment in Maine is forecasted to decline slightly by nearly 16,000 jobs over a decade as a wave of workers reach retirement age, though the state is optimistic about in-migration due to increased remote work following the coronavirus pandemic.
The state’s economic forecast through 2028, released on Tuesday, revises a report from two years ago to predict Maine’s labor force will shrink by about 15,800 jobs, or two percent, between 2018 and 2028. It reflects the changing demographics that could have profound economic effects in the coming years, with added uncertainty due to the global pandemic that has stunted short-term economic growth while setting the table for future changes to work.
The size of Maine’s labor force has remained relatively stable over the past 15 years as the working-age population remained unchanged. But deaths have exceeded births here over the last decade as the state’s population has continued to age.
Since 2015, the aging workforce has been offset in part by increased migration to Maine, which the state attributes to strong economic conditions. While the effects of the pandemic are not yet fully realized, forecasters anticipate more migration to Maine as some workers leave large metropolitan areas for places with lower living costs, though the flow of working-age people into Maine is not expected to entirely make up for the number of older workers retiring.
“It appears that there are quite a few people looking to get out of large metro areas,” said Glenn Mills, deputy director of the Center for Workforce Research and Information at the Maine Department of Labor. “So generally, I expect that there will be for some period of time a surge of in-migration into Maine, but until that develops it’s educated speculation.”
Forecasters caution that declining employment does not have to correlate with slower economic growth and decreased living standards. They point to continued increases in productivity as a means to counteract a declining workforce, and say that difficulties some employers saw in finding workers prior to the pandemic were mostly because of a strong labor market and low unemployment, factors that were seen nationwide and not unique to Maine’s older workforce.
Changing demographics are also expected to affect the kinds of jobs that are created in the coming decade, with state forecasters predicting about 11 percent of jobs to turn over each year with an annual average of just over 75,000 openings.
The shift from employment in businesses that produce goods to those that provide services is expected to continue in the coming years. In 2000, about 82 percent of jobs in Maine were in service industries, up from 56 percent in 1950. By 2028, that number is expected to climb to 87 percent, according to the state forecast. The largest job growth is expected in the health care and social assistance sectors, driven by a need to care for the state’s aging population. Leisure and hospitality jobs are also expected to grow.
On the other side, retail and manufacturing jobs are expected to see the largest decline due in part to increased automation. These job losses are expected to be concentrated in occupations that pay in the middle of the earnings spectrum, though the overall change in the distribution of jobs by pay level is expected to be relatively small.