Posted on: Wednesday, October 13, 2004
Steady growth seen for biotech, drug jobs
Advertiser Staff and News Reports
Jobs in Hawai'i's biotechnology and pharmaceutical industries nearly tripled in between 1983 and 2003, but the overall size of the workforce remained relatively small at just 317 workers.
However, local jobs in the two industries paid a relatively high average wage of $45,300, according to an industry-sponsored study of the drug making industry released yesterday. The study forecast steady employment growth over the next decade in the sector, which is among the highest salaried and productive in the nation.
As a result, many state and local governments are trying to lure drug manufacturing to their areas to boost their economies.
In Hawai'i, that effort includes the $150 million new campus for the John A. Burns School of Medicine in Kaka'ako, which school officials hope will be a new center high-tech and science-based workforce for the state when it opens in January.
"The industry is very critical to the future of the economy," said Milken Institute economist Perry Wong, who co-wrote the report paid for by the Pharmaceutical Research and Manufacturers of America, known as PHRMA. "It's one industry that is high in growth potential. It is very unlikely to have jobs outsourced."
The report said jobs in the combined industries of biotechnology and pharmaceutical nationwide are forecast to grow by 32 percent from 406,700 workers to 536,300 within 10 years.
Although the biotech and pharmaceutical industries employ a relatively small number of people in comparison to the the total workforce, the study noted that the jobs are much higher paying than most and help create more indirect jobs. The study concluded that every biotech job creates another 5.7 jobs in other industries. Every retail job accounts for an additional 0.9 jobs, according to the report.
"These are good jobs and good wages," said PHRMA chief executive Alan Holmer.
That's why governors such as Florida's Jeb Bush and mayors such as San Francisco's Gavin Newsom are offering the industry tax breaks, free land and other financial incentives to relocate, according to the report.
A separate report prepared for the Biotechnology Industry Organization and released at its annual convention in June, said at least 29 states have formal plans to woo the biotechnology industry and many, like Pennsylvania, are using money gained from the global tobacco settlement to fund biotechnology development projects.
Six governors made the trek to the June BIO conference and dozens of states and cities have colorful booths on the convention floor.
But some economists warn that drug manufacturing is still a tiny industry dominated by a few big companies and highly concentrated in a few regions of the country.
Drug companies like to "cluster" around universities and each other so they can easily swap — and steal — technology and scientists, making it difficult for regions to launch a biotechnology industry from scratch, said Joseph Cortright, a Portland, Ore., economist who co-wrote a report on the subject.
"This is an industry that is very tightly sequestered in a few metropolitan areas and it's becoming more highly concentrated," Cortright said. "It has grown fastest in the areas that it is most established and that points to the fact that there are real business advantages to being located where the clusters already are."
