Despite any doom and gloom about the state economy, rising inflation and increases in the cost of living and doing business, Massachusetts came in sixth among states ranked by private investment in 2022, according to a new report.
“Private equity invested more than $55 billion in 312 businesses in Massachusetts last year and directly employed more than 307,000 workers across the commonwealth,” Drew Maloney, president and CEO of the American Investment Council told the Herald Monday.
The council’s annual Top States & Districts report shows that the Bay State received more in private investment last year than the state’s final enacted budget for fiscal 2022, about $48 billion, or the next fiscal year’s about $53 billion.
Two congressional districts in Massachusetts, represented by U.S. Reps. Katherine Clark and Stephen Lynch, saw more investment than any others in the state and more than most in the country, the report shows.
According to the report, Lynch’s MA-8 district was the tenth most highly invested nationally, seeing $12.8 billion in private equity coming in during 2022, while Clark’s MA-5 came in fourth and saw $19.5 billion in private funds.
California Rep. Nancy Pelosi’s district led the pack at $72.6 billion, according to the report, more than twice New York’s Rep. Jerry Nadler’s second place $27.5 billion.
Private equity investment, according to the council, can be seen much like the flipping of a house.
“Investors put capital into companies with growth potential and work with them to expand or turn around the business, and after a few years, the company can be sold at a profit. PE investments usually result in better jobs, stronger companies and retirement/pension portfolios and healthier communities,” Dani Marx, an associate vice president with the council, said with the report’s release.
The news comes after the November approval of a new constitutional amendment which added a 4% surtax to incomes over $1 million.
Opponents of the so-called Fair Share Amendment have maintained that it will have a cooling effect on business investment in the state at a time when competition for workers and industry is at its most fierce.
Asked if the council thought the change in the state’s tax code would reduce investment in the state, Maloney said his organization is calling on lawmakers to make it easier for businesses to succeed and employees to retire.
“We will continue to call on public leaders to support policies that encourage more local investment that fuels small businesses and strengthens retirements for public sector workers,” he said.