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IUMFC COLLECTION The 31EDbb DE7D 71Sfl SEP 24 1991 Massachusetts^ ASK?" lt Massachusetts Centers of Excellence Corporation • April 1991 _ The Massachusetts Marine Economy William Hogan Daniel Georgianna Toby Huff Southeastern Massachusetts University Massachusetts Centers of Excellence Corporation April 1991 ACKNOWLEDGEMENTS Thisstudywascommissionedby the MassachusettsCentersofExcel- lenceCorporation (MCEC)and funded byagrantfromMCEC toSoutheastern MassachusettsUniversity (William Hogan, EconomicsDepartment, Principal Investigator). We wish toacknowledge theassistanceand adviceofseveral people who helped us in the preparationofthis study. MeganJones, Directorofthe MassachusettsCentersofExcellenceCorporation, GaryGlenn, DeputyDirector ofMCEC, Phoebe Kent,Executive AssistantofMCEC,and MarkForest, Regional RepresentativeofCongressmanGerry E. Studds and memberof the Marine MCEC Science Board of all read variousdrafts ofthereport and contributed toits final form. Martin Levine, DirectoroftheResearch Library oftheMassachusetts Departmentof Employment and Training(DET) made available the ES202 file maintained by DET and assisted with its interpretation. Mr. Levinealso provided copiesof several studiespertinent to our undertaking. Frank Cahill, Senior Labor Market Economist for DET, discussed useof the ES202 file and approaches to identifying themarineeconomy. Roger Hatch, Directorofthe Data Bankof the MassachusettsDepartment ofRevenue (DOR), provided informationon assessed valuation ofcounties, cities, and townsin Massachusetts. TheState Data Center, maintained in Amherst and Bostonby the Massachusetts Institute for Social and Economic Research of the University ofMassachusetts, provided census information from the United Statescensusesof 1980 and 1990. Several experts in variousaspectsof the marineeconomy supplied data and advice. These include: Sarah Mann, Director ofthe MassachusettsOfficeof Travel & Tourism; MalcolmWilbur, Personnel Directorat CapeCod National Seashore; Charles Dane, DirectorofForestsand Parks, MassachusettsOfficeof Parksand Forestry; Phil Logan, ChiefofEconomics Investigation, Steve Edwards, Economics Assessment Scientist, Dennis Main, Port Agent in New Bedford,Stan Wang, Branch Chief, and Mark Holliday, ActingChief, Fisheries Statistics Division, all from theNational Marine Fisheries Service;Jim Broadus, Director, Yoshi Kaoru, AssistantResearch Scientist, and Hauke Kite-Powell , Department Assistant, all from Woods Hole Oceanographic Institution; Chris Kellogg from the New England FisheriesManagement Council, and Tony Fedler Directorof Economics from the Sport Fishing Institute. We wish to thankJames Broadus forpermission to use the mapin Figure 20 on page 21, from James M. Broadus, Porter Hoagland, and Hauke Kite-Powell, Determining the Structure of the United States Marine Instru- mentation Industry and Its Position in the World Industry, Woods Hole: Woods Hole Oceanographic Institution, 1988. Diane Azevedo-Carns of Academic ComputingServices atSoutheastern Massachusetts University designed the publication. Sharon Georgianna drew the cover illustration. Table of Contents THE MARINE ECONOMY OF MASSACHUSETTS 2 Identifying The Marine Economy 2 Population Growth and Real Estate Values 3 Marine Industries 8 Connections to Other Industries 8 Summary of the Massachusetts Marine Economy 10 THE MASSACHUSETTS FISHING INDUSTRY 12 Commercial Fishing 13 Fish Processing, Wholesaling, and Retailing 16 Recreational Fishing 19 3 MARINE ELECTRONICS 20 4 MARINE ENVIRONMENTAL SERVICES 22 5 MARINE RESEARCH AND EDUCATION 23 6 MARINE RECREATION AND TOURISM 26 7 BOAT BUILDING, REPAIR, AND SALES 28 8 WATER TRANSPORTATION 31 9 MARINE AQUACULTURE 32 10 APPENDICES 34 1 The Marine Economy of Massachusetts "after long beatings at sea they In 1602 Bartholomew Gosnold Identifying the Marine jell with that land that is called Cape Cod; visited and named the land we now Economy the which being madeand certainly call Cape Cod. Evenbefore this time, known to be it, they were not a little British, French, and Portuguese Although many marine activities joyful... A word or two by the way ofthis fishermen had used the shores of the are located in coastal communities, the cape. It was thusfirst named by Captain new world to dry, salt, and prepare marine economy of Massachusetts Gosnold and his company, Anno 1602, cod and other fish prior to shipment extendsbeyond coastal areas. The because they took much ofthatfish there." back to Europe. The famous landings scope of this study is, therefore, partly of theMayflower in 1620 and the geographical and partly industrial. William Bradford, Arbella in 1630 marked thebeginnings We will focusboth on commercial OfPlymouth Plantation of permanent settlement by Europe- fishing and marine recreation concen- ans ofMassachusetts. Since these trated in coastal cities and towns and beginnings, the economy, culture, and on industrial categories, such as society of Massachusetts have re- marine electronics, that are located volved around marine activities. throughout the state. Coastal areas Until recently, marine activities in and industrial categories are defined Massachusetts involved mainly in Appendix A. fisheries and the building of ships and Our goals are to estimate employ- boats. While these continue as an ment and payroll in the various important part of the Massachusetts sectors of the marine economy, to marine economy, electronics, recre- summarize the totals for the entire ation, and environmental research marine economy of Massachusetts, have become significant new compo- and to identify important characteris- nents. In addition, marine industries tics and trends within each marine are connected to many other sectors of industry. We have taken a conserva- the economy asbuyers of their tive approach to identifying the scope products or as sellers of required of the marine economy. Some of the materials. data we wanted were not available. The marine economy is a major Other data on marine activities were j source of jobs, income, and prosperity inextricably combined with non- in Massachusetts. Many industries marine data. When it has been statewide are involved and connected impossible to separate marine from in ways that sometimes are not non-marine data, we have tended to obvious. Marine interests in Massa- leave out categories entirely rather chusetts have much in common than include information that con- whether they are located near coastal tained significant non-marine compo- areas or inland. nents. We would argue, therefore, that the estimates of the marine economy provided in this study are a lowerbound on its true size and j scope. In the course of the study, we have identified a number of interest- ing and important characteristics, changes, and trends in the marine economy that would merit additional, more detailed study. These are noted as they occur in the following sections - Population Growth and Real Table 1. Population Growth, 1980 to 1990 Estate Values 1 1980 1990 Absolute Percent During the decade 1980 to 1990, Change Change Cape Cod and the Islands and the coastal areas ofPlymouth county Barnstable County 147,925 186,605 38,680 26.15% grew much faster than othercoastal Dukes County 8,942 11,639 2,697 30.16% areas and faster than Massachusetts Nantucket County 5,087 6,012 925 18.18% as a whole. Cape Cod and the Islands grewby 26 percent, the coastal areas & Cape Cod Islands 161,954 204,256 42,302 26.12% ofPlymouth county grew by 10 per cent, while other coastal areas and the Coastal Towns &Cities Of: state as a whole grew by 5 per cent Bristol County 278,814 282,919 4,105 1.47% (Figure 1). The official counts ofthe Essex County 285,216 296,510 11,294 3.96% United States censuses of 1980 and Norfolk County 147,518 146,123 -1,395 -0.95% 1990 are shown for various areas in Plymouth County 151,354 166,730 15,37 10.16% Table 1. The coastal areas ofBristol, Essex, Norfolk, and Plymouth coun- Suffolk County 650,142 663,906 13,764 2.12% ties do not include the entire counties. Coastal areas in Barnstable, Dukes, Total Coastal Nantucket (Cape Cod & Islands), and Cities and Towns 1,666,056 1,748,805 82,749 4.97% Suffolkcounties include the entire counties. Total Non-Coastal Cities and Towns 4,071,037 4,267,620 196,583 4.83% Total Massachusetts 5,737093 6,016,425 279,332 4.87% Source: Mass.StateData Center,returnsofU.S. censusesof1980and 1990,bycounties,cities,and townsin Massachusetts LOCATION Figure 1. Population Growth, Percent, 1980-1990 (U. S. Bureau of the Census) The growth of real estate values 300 during the past decade is one of the most widelyknown economic facts in Massachusetts. The value ofcoastal real estate has traditionally been higher than the state average. Cur- rently, coastal real estate per acre is worth approximately two and one- half times non-coastal real estate. While this differential has been 8 maintained over the past decade, both UJ 0. coastal and non-coastal real estate values have increased substantially. Values, measured in terms of "equalized valuation" as calculated by the Massachusetts Department of Rev- enue, increased by approximately 85 percent from fiscal year 1984 to fiscal year 1990 (Figure 2). LOCATION Figure 2. 1990 Real Estate Values As Percent of 1984 (Mass. Dept of Revenue) Table 2 and Figure 3 show real estate Table 2. Equalized Valuation per Square Mile, 1990 values per square mile for coastal and (dollars per square mile) - - non-coastal communities for fiscal year 1990. Real estate sales generate employ- Barnstable County $77,749,697 ment and income directly through Dukes County 41,244,620 sales commissions, financial services, Nantucket County 78,416,551 surveys, appraisals, advertising, and otheractivities. Higher real estate & Total Cape Cod Islands 70,835,693 values would generate greater employment and income for these Coastal Cities and Towns Of: activities. New construction gener- Bristol County 62,186,442 ates higher real estate tax revenues for Essex County 110,396,203 cities and towns. Norfolk County 221,874312 Marine-related real estateem- Plymouth County 56,701,040 ployment, payroll, and incomes cannotbe separately identified in the Suffolk County 748,839,714 available data sources. However, the direct income effects ofincreased real Total Coastal Cities and Towns 106,411,077 estate values may be roughly estimated. The total increased valuation Non-Coastal Cities and Towns 44,120,103 in coastal communities from 1984 to 1990 was $91,279,704,000. If total Total Massachusetts 54,647,708 associated sales commissions, financial services, surveys, and other Source: Land Areas from U.S. Census of 1980, as providedbythe MassachusettsState service fees average 7 percent of Data Center; Equalized Valuations for fiscal year 1990 provided by Mass. Dept. of selling prices, and if 10 percent ofreal Revenue, Division ofLocal Services, Data Bank property changed hands during the period 1984 - 1990, $639 million of income would be generated by this 800000 increased valuation. Such an estimate ofdirect service income is in addition to the capital gains income to property owners. These estimates are not comparable with the data on employ- 600000- ment and payroll for other marine industries, and are not included in the < totals given below inTable 6. -J O O u. O 400000- V) Q Z 2 < < J lD/J ' 200000- Figure 3. Real Estate Value per square mile, 1990 (Mass. Dept of Revenue) . * : Per capita incomes vary substantially among coastal communities. Table 3. Estimated Per Capita Income As a Percent of Table 3 presents the most recent Massachusetts Per Capita Income, 1987 estimates by the United States Bureau of the Census ofper capita incomes Barnstable County 98.0% expressed as a percentage of the state- Dukes County 95.1% wide average per capita income (a Nantucket County 141.8% value of 100 in this table means that the area had a per capita income equal Total Cape Cod & Islands 99.1% to the state average). Figure4 shows the data in graphic form. astal Communities Of: Unfortunately, actual per capita Bristol County 71.1% incomes (as opposed to estimates by Essex County 102.5% the Bureau of the Census) for cities Norfolk County 105.4% and towns from the 1990 census are Plymouth County 108.9% not yet available. The table indicates thatareas in both the North Shore and Suffolk County 89.5% South Shore are considerably above the state average. Bristol county and Total Coastal Communities 92.9% Suffolk county are both below the state average. Non-Coastal Communities 102.9% Total Massachusetts 100.0% Source: U.S. Bureau of the Census, as provided by Mass. State Data Center Figure 4. Per Capita Income as Percent of Massachusetts, 1987 (U. S. Bureau of the Census)