UNH Whittemore School of Business and Economics

New Hampshire Small Business Development Center


UNH Report Explores Manufacturing: "New Hampshire's Secret Strength"

By Janet Lathrop
UNH News Bureau

April 18, 2002

DURHAM, N.H. -- A new report released by the New Hampshire Small Business Development Center's (SBDC) Manufacturing Management Center, a program of the University of New Hampshire Whittemore School of Business and Economics, suggests that manufacturing may be the strongest contributor to New Hampshire's economy and overall prosperity.

The research, conducted by Ross Gittell, the James R. Carter professor and chair of the management department at the Whittemore School, highlights the performance of and prospects for manufacturing in the state. It builds on and updates a previous manufacturing outlook provided last year by the SBDC.

Mary Collins, SBDC state director, recalled that the MMC was started 10 years ago with seed money from the Gruber Foundation. "Now the Manufacturing Management Center is a cornerstone of the SBDC's statewide program," says Collins. "With the Whittemore School, we're very pleased to support -- through such research -- an important segment of our state economy. Manufacturing contributes 25 percent of our gross state product, it opens new markets and can benefit rural areas, in particular. This report gives us a solid guidepost for continued manufacturing growth."

Gittell's research shows that the Granite State's strong performance in manufacturing is probably due to a number of factors, including location near the Boston-area production system, access to leading high-tech firms, research and development capacity at companies and universities in the region, a skilled work force and relatively low business costs within a high-cost region.

New Hampshire also enjoys high employment levels, production of high value-added goods by workers of greater-than-average productivity, and a high number of manufacturing companies overall. This last factor reduces the state's dependence on any single firm and increases competition, innovation and information sharing. New Hampshire is a manufacturing standout in the nation and the region, according to Gittell's research, ranking first in the Northeast in percentage of manufacturing employment.

"This is an important time to take a detailed look at manufacturing in New Hampshire," notes Gittell. His report identifies key issues and vulnerabilities and addresses factors that will affect future competitiveness.

For instance, a big part of the high-tech sector success in New Hampshire is due to high-tech employment in manufacturing. The Granite State has about twice the national average in this measure -- that is, manufacturing accounts for 63 percent of all high-tech employment here, compared to 33 percent in the nation and 42 percent in New England. However, that strength becomes a weakness, Gittell points out, "if the nation continues to experience substantial economic slowdown.... New Hampshire would be most adversely affected by continued contraction in high-technology industries and extended weakness in business capital investment."

In addition to analysis of the changing landscape of manufacturing in New Hampshire, the report identifies the leading manufacturing industries here, along with new, emerging industries to watch. It lists leading manufacturers, discusses venture capital's relationship to manufacturing, and offers perspective on manufacturing and the U.S. economic slowdown. Tables chart economic trends and differences by county in New Hampshire, and Gittell offers an analysis of some critical issues faced by New Hampshire manufacturing as it struggles to stay competitive.

Full text of the report is available at the SBDC Web site: www.nhsbdc.org/ and clicking on "News and Publications," or by calling 862-2200.

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