New Life Science Industry report: Mass. gained only 55 life science jobs between 2010 and 2012

Last week, Pioneer Institute issued a report calling for Massachusetts to adopt two enhanced research and development tax credits, pointing out that research and development expenditures by Massachusetts industries dropped by 19% between 2007 and 2011 while California’s increased by 16.9% and the rest of states by 9.2% on average.  We also pointed out that California, which offers R&D tax credits vastly superior to Massachusetts’, has outpaced the nation in R&D growth.  Over the past two decades, the growth of industrial R&D expenditures by California business was greater than that of its top seven competitor states combined, Massachusetts included.

But the part of our report that generated the biggest controversy was the calculation that Massachusetts had added only 571 life science jobs in the first five years of a ten year publicly-funded $1 billion life science initiative, using the industry’s own methodology of counting jobs.

[quote align=”right” color=”#999999″]By any of these measures Massachusetts is falling far short of creating the 250,000 new jobs promised by Governor Patrick over the ten-year term of the life science initiative.[/quote]
Actually, Pioneer reported the 571 figure as one of three separate calculations of life science job growth, each one using the precise methodology that had been employed in three published reports sponsored by the Massachusetts life science industry.  Pioneer used the industry’s own counting methods, simply plugging in the jobs data as reported by the federal government.  Measured by the two other industry-employed methodologies, Massachusetts had gained 1,438 jobs and 3,024 jobs respectively.  We reported all three numbers and pointed out that by any of these measures Massachusetts is falling far short of creating the 250,000 new jobs promised by Governor Patrick over the ten-year term of the life science initiative.

The Pioneer report, issued on the first day of the life science industry’s annual BIO conference in San Diego, prompted reactions.

Susan Windham-Bannister, president of the state authority in charge of the life science initiative, the Massachusetts Life Sciences Center, said, “We just don’t understand how the Pioneer Institute did its analysis.”  Senate President Murray, who like Windham-Bannister was in attendance at the conference, said. “It seems like they started with the conclusion and created a study to support the conclusion.”

Given that Pioneer had used the industry’s own methods of counting life science jobs, and, as we explained in the report,  used the same federal source of jobs data that the industry had used, we found both comments to be remarkable.  The first comment stands for the proposition that the president of the Massachusetts Life Sciences Center claims not to understand the very analytics that her constituent companies used to advocate for the legislation and to report on its consequences.  The second stands for the proposition that Pioneer’s calculation of job gains using the industry’s own methodology represents a preordained conclusion.  In fact, Pioneer didn’t even “create a study” in this regard.  We simply totaled the job gains using the industry’s methodology.

What is more astonishing is that a national state-by-state report on life science job growth was issued at the BIO conference by Battelle on the very same day that Pioneer issued its report, Battelle/BIO State Bioscience Jobs, Investments and Innovation 2014 was handed out at the conference.  And here is the truly amazing thing about it: Battelle’s report shows that Massachusetts gained 55 jobs between 2010 and 2012.

That’s right.  Even as they were calling our (their) job numbers into question, the critics in San Diego were in receipt of Battelle’s biannual state-by-state life science jobs report showing that even that fewer jobs had been created than we reported using their methodology.

Here’s Battelle’s 2014 report showing that Massachusetts had 77,817 life science jobs in 2012:

Here’s Battelle’s 2012 report for Massachusetts, issued at the 2012 BIO conference, showing that in 2010 Massachusetts had 77,762 life science jobs in 2010:   (see page 89.)

So, let me be completely clear about my methodology showing that Massachusetts has added only 55 jobs between 2010 and 2012, according to Battelle’s state-by-state industry report:

Battelle’s calculation of MA life science employment 2012	77,817 jobs
Battelle’s calculation of MA life science employment 2010	77,762 jobs
Net increase in MA life science employment 2012-2010	55 jobs

Please note: these are not Pioneer’s figures.  They were calculated by Battelle using Battelle’s methodology.  Pioneer did not design this methodology, just as we did not design the job counting methodology reported by us last week.  All Pioneer did then and again today is to total up the results.

Of additional interest is a comparison of life science job gains of each state between 2010 and 2012, derived from the two aforementioned Battelle reports, showing that Massachusetts ranked 31^st among the states in percentage increase in life science employment and 29^th among the states in increase in life science employment.

State	2010	2012	% Incr/Decr	Rank % Incr/Decr	Incr/Decr	Rank Incr/Decr
CA	228,700	235,864	3.1%	18	7,164	1
NC	62,386	66,123	6.0%	12	3,737	2
MI	39,282	41,892	6.6%	8	2,610	3
AZ	21,084	23,545	11.7%	3	2,461	4
TN	38,025	40,411	6.3%	9	2,386	5
TX	78,452	80,792	3.0%	20	2,340	6
UT	23,406	25,101	7.2%	6	1,695	7
CO	26,830	28,510	6.3%	10	1,680	8
NY	74,873	76,070	1.6%	25	1,197	9
WI	30,796	31,758	3.1%	19	962	10
MO	27,180	28,109	3.4%	16	929	11
FL	78,062	78,925	1.1%	28	863	12
NM	7,443	8,304	11.6%	4	861	13
AL	11,945	12,794	7.1%	7	849	14
OH	47,536	48,294	1.6%	26	758	15
MD	33,257	33,981	2.2%	23	724	16
VT	1,957	2,585	32.1%	1	628	17
NE	14,978	15,467	3.3%	17	489	18
VA	26,127	26,545	1.6%	24	418	19
ND	3,638	4,004	10.1%	5	366	20
DE	7,938	8,174	3.0%	21	236	21
SD	4,976	5,175	4.0%	13	199	22
AR	6,223	6,405	2.9%	22	182	23
KS	13,266	13,446	1.4%	27	180	24
OR	13,423	13,556	1.0%	29	133	25
AK	735	843	14.7%	2	108	26
MT	2,464	2,559	3.9%	14	95	27
D.C.	1,962	2,037	3.8%	15	75	28
MA	77,762	77,817	0.1%	31	55	29
KY	11,351	11,405	0.5%	30	54	30
WY	831	883	6.3%	11	52	31

It is pretty remarkable that Pioneer’s reporting of life science job gains, calculated using the same methodologies employed by industry reports, could be characterized as a study created to support a conclusion.  I think the Battelle report debunks that myth.