Harvard University holds the distinction of being the oldest university in America. It was established in 1636 in Cambridge, Massachusetts, and was originally called New College. Since then, higher education has been valued deeply in the New England Region.
Four of the eight traditional Ivy League schools are located in the New England states, which include Massachusetts, Connecticut, Rhode Island, New Hampshire, Vermont and Maine. And four of the Seven Sisters, which are women’s-only colleges built as counterparts to the traditional Ivy League schools, also are located in New England.
These institutions and other colleges have helped to shape the regional economy. For instance, the well-regarded Massachusetts Institute of Technology (MIT) was incorporated in 1861 with the expressed purpose of accelerating the Industrial Revolution in the U.S.
Three of these states ranked in the top 10 in the U.S. for the number of students as a percentage of the state’s overall population, according to a 2017 survey. New Hampshire ranked No. 1 with 147,773 college students, or 11% of the total population. Rhode Island was No. 8 (69,543, or 6.6%) and Massachusetts was No. 10 (444,670, or 6.5%).
Finance, insurance and legal professions are pillars of the local economies in Massachusetts and Connecticut. For instance, Massachusetts and Connecticut rank No. 3 and No. 4 for the number of lawyers per 1,000 residents (6.1 and 5.8, respectively), according to the American Bar Association. There are signs that the financial-services sector has suffered, especially due to the recent rise of remote work. In Massachusetts, the number of people employed in finance and insurance was 192,000 in 2002. This number dropped to 173,000 last year.
New Hampshire, Vermont and Maine rank among the top 10 states for number of ski resorts. Maine’s lobster harvest in 2021 was the most valuable in the state’s history with a value of $725 million, an increase of 75% over the prior year. And New Bedford, Massachusetts, was the No. 1 port in the nation in 2020 for the dollar value of seafood landed ($451 million).
Massachusetts has one of the strongest economies in the U.S. The Bay State’s gross domestic product (GDP) — or the sum of all goods and services — ranked 12th in the nation in 2021 with a total value of $641.3 billion, according to the U.S. Bureau of Economic Analysis.
Connecticut is the only other state in the region to rank in the top half of the country for GDP size, coming in 23rd at $298.4 billion. New Hampshire ranked 38th ($99.7 billion), Maine was 43rd ($78 billion) and Rhode Island was 44th ($66.6 billion). Vermont came in last among all states with a GDP of $37.1 billion.
Four of these states saw their GDP grow faster than the national average of 5.9% in 2021, led by New Hampshire with 9.3% growth. Only Connecticut (4.8%) and Vermont (5.1%) posted slower growth than the nation as a whole. ●
Warmer states in the South became a popular destination for people who could work remotely after the arrival of COVID-19. Another trend is emerging in which people are buying homes away from expensive cities but still close enough for the occasional trip back to the office. New England is benefiting from this trend.
Six of the 10 hottest ZIP codes in the U.S. in 2022 were located in New England cities, according to Realtor.com. Each of these cities were less than 150 miles from major metropolitan areas in the Northeast while being, in many cases, hundreds of thousands of dollars less expensive. They include the New Hampshire cities of Nashua, Derry and Hookset; Windham and Auburn, Maine; and North Attleboro, Massachusetts.
Five of the six New England states experienced double-digit home price growth for the year ending this past October, with the lone exception of Massachusetts, according to Zillow. The Bay State, which already had the most expensive housing in the region, had 8.9% price growth during this period. New England has some of the oldest housing stock in the U.S., according to the National Association of Home Builders. Massachusetts and Rhode Island rank No. 2 and No. 3 in the nation (trailing only New York) for the median age of a home at 56 years and 55 years, respectively.
What the Locals Say
Up until the refinances dried up in the first half of 2021, it was extremely busy in Vermont. Even after the refis stopped, we still were busy. Realtors wouldn’t even look at offers unless there was at least a 20% downpayment. It was tough for those folks to get offers accepted.
A lot of people from New York and Connecticut were buying second homes here, working remotely, trying to figure out what was going to happen with their job. They could work anywhere they wanted remotely and they were choosing Vermont because of the quality of life. We see a lot of that. On social media, I see a lot of Vermonters not happy about that.
We’ve seen these markets before when interest rates skyrocket. So many people in our pipeline now are like, ‘I’m putting a pause on this.’ I think, psychologically, people just need a break right now. I think people need to get back to feeling comfortable about purchasing a home.
You can’t just buy a hundred acres and start building next month. The state of Vermont, depending on the town you’re in, makes it very difficult to build and it takes years to get these permits approved. So, there’s not enough housing for the demand. With Vermont, for the next four to five years, you are going to see this low-inventory, high-demand market. People are still going to want to live here. It’s a good place to raise their children, with low crime, and it’s appealing with remote work. But the housing is tough.
Fairway Independent Mortgage Corp.
3 Cities to Watch
Lobstering and tourism have long been hallmarks of the economy for the largest city in Maine (population 68,000). But Portland is getting an investment that aims to boost its economy. More than $200 million has been pledged for Northeastern University’s Roux Institute, a waterfront research center for artificial intelligence, machine learning and life sciences. Silicon Valley investor David Roux donated the first $100 million for the environmentally sustainable project that’s still in the planning stages.
The “City of Firsts” holds the distinction of being the first city in the U.S. named Springfield. Other notable firsts include being the birthplace of basketball. Postcards were first developed there, as was the first car built in the U.S. Smith & Wesson has been headquartered in the city since 1852 but plans to move to Tennessee this year due to a changing business climate for gun manufacturing in Massachusetts. The company plans to continue employing 1,000 people in the Bay State.
The “City of Elms” will be the beneficiary of two new major infrastructure projects. The state of Connecticut plans to spend $8.7 billion to improve the New Haven rail line, expanding access and shortening the travel time from Connecticut to New York City. And the Tweed New Haven Airport reached a 43-year lease with a private operator, which will spend $100 million to build a new terminal and extend the runway. New Haven (population 135,000) also is home to Yale University.
Sources: American Bar Association, American School & University Magazine, City of Springfield, Massachusetts Institute of Technology, Mass Transit Magazine, National Association of Home Builders, National Oceanic and Atmospheric Administration, Northeastern University, Realtor.com, Smith & Wesson, SnowBrains.com, State of Maine, The Boston Globe, The New York Times, The Washington Post, TopUniversities.com, U.S. Bureau of Economic Analysis, U.S. News & World Report, Zillow