Killer Innovations: reblog

Massachusetts is maintaining many of the underpinnings of its innovation economy according to the 2006 Index of the Massachusetts Innovation Economy. However, the state is at risk of losing ground in key technology clusters--continued sub-par job growth, relatively low rates of commercialization and high-tech start-ups, and relatively high housing costs contribute to an exodus of younger workers and graduates that seriously undermines the potential for economic expansion.  Positive signs include success in attracting R&D dollars, healthy patenting activity, and robust corporate sales figures.  Other positive signs include:

·         Positive job growth in the software cluster for the first time since 2001; 

·         Attracting a large share of total venture capital investment at 11%, second only to CA, as well as attracting a high-share of total federal R&D investment at 6%;

·         Best in class in educational attainment, with approximately 37% of the population holding a bachelors degree or higher; and,

·         Manufacturing exports represent a high share of GSP and are growing.

The key problem areas identified in the report:

Lag in job growth compared with other Leading Technology States

Lags its competitor states with negative job growth in key industry clusters, including Diversified Industrial Support, Financial Services, Healthcare Technology, and Software & Communications Services.

Insufficient capture of downstream economic benefits

Massachusetts created 12.8 new high-tech businesses per 100 high-tech establishments, compared to 14.6 in California and 14.1 in Virginia. Massachusetts firms attract the smallest percentage of venture capital to “expansion stage” companies that are poised for maturation and growth. Massachusetts share of total US venture capital investment has declined for the second straight year.

Lack of affordable housing contributes to ongoing population loss

Massachusetts has the smallest percentage of the most affordable class of housing of any of the Leading Technology States.

The Index, published annually since 1997, was developed by the John Adams Innovation Institute, the economic development arm of MTC.  The Index tracks ten key industry clusters and benchmarks Massachusetts performance against nine other Leading Technology States. For more information, visit www.masstech.org.