Contact Us
News

Massachusetts Manufacturing Isn't Dead — It's Different

Want to get a jump-start on upcoming deals? Meet the major Boston players at one of our upcoming events!

Massachusetts has lost manufacturing jobs in recent years, threatening to drop out of the nation's top 10 markets. But productivity in the state is at an all-time high. One of the influencers might surprise you.

Massachusetts Manufacturing Isn't Dead — It's Different

The Commonwealth’s manufacturing gross output hit a record high of $48B in 2015 (a $3B jump from the prior year), according to the Bureau of Economic Analysis. While local manufacturing jobs are stabilizing compared to the economically hard-hit Midwest’s rebound, it is misleading to say things are going downhill quickly. From Shire’s expanded manufacturing facilities in Lexington to Callaway Golf’s 10-year lease extension for its U.S. manufacturing hub in Chicopee, manufacturing has a different style of strength here than the rest of the country.

“If you look five years out and beyond, durable goods are what drove manufacturing,” said Branner Stewart, a senior research manager at the UMass Donahue Institute. “What’s surprising to me is that if you go to the last four to five years, non-durables have been performing particularly well here.”

Massachusetts Manufacturing Isn't Dead — It's Different

Chemicals like pharmaceuticals account for the boost, but Stewart also points to food and beverage as growing players in the state’s manufacturing sector — especially the latter. According to the Bureau of Labor Statistics, food manufacturing jobs in Massachusetts have risen 4% since the end of 2011. Beverage manufacturing jobs have grown 43%. 

Beverage manufacturers are aggressively moving into industrial spaces left by older companies. At its peak, the Avery Dennison label and packaging firm employed 3,000 in downtown Framingham. Over the years, it diminished in size, and its departure in 2013 left an array of empty warehouses across the town, including over 100k SF at 100 Clinton St. Calare Properties gutted the space and retrofitted 67k SF for craft brewer Jack’s Abby in 2014. 

Massachusetts Manufacturing Isn't Dead — It's Different

“Industrial spaces can easily be reconfigured based on the needs of new tenants,” Calare managing director Charles Nolfi said. “This flexibility and optionality gives industrial property the ability to become whatever is needed in an economy that is changing and with user needs that are constantly evolving.”

Craft brewers across the state are growing significantly. Fort Point’s Trillium Brewing Co. will relocate from its 2k SF Congress Street facility to a 15k SF space nearby. It also recently acquired a 16k SF building in Canton. Tree House Brewing received $7.7M from MassDevelopment to open a new 53k SF facility in Worcester County. Jack’s Abby also announced an expansion: it will grow by 63k SF, bringing its operation to 130k SF.

Massachusetts Manufacturing Isn't Dead — It's Different

Calare CEO Bill Manley and Stewart both said the state’s manufacturing sector is successful due to innovation and a skilled labor pool. This accounts for greater productivity with fewer numbers. 

“Manufacturing here is doing well because of a great governmental climate and the Baker administration’s business incentives,” Manley said. “It’s a great place to be with the intellectual capital. There are a lot of groups that go to other areas and struggle to hire ... You’re not going to find this kind of labor pool in Fort Lauderdale or Missoula, Montana.”

The Jack's Abby team would agree from the success it has seen from its Framingham footprint.

“Super-traditional manufacturing doesn’t necessarily rule Massachusetts. It’s a different environment,” Jack’s Abby co-founder Sam Hendler said. “But if you’re willing to be on the cutting edge with your technology and offer a direct connection with customers, you can figure out a way to hit a good profit margin.”