Keller @ Large: Why Did Fidelity Move Jobs To NH, RI?

By Jon Keller, WBZ

BOSTON (CBS) – Governor Patrick is busy posing for publicity photos overseas these days, so it was left to Lt. Gov. Tim Murray yesterday to give the official reaction to the terrible news that Fidelity Investments, a flagship employer of the crucial Massachusetts service sector, is pulling 1100 jobs out of here and sending them to New Hampshire and Rhode Island.

Said Murray: “We are disappointed.” No argument there, Tim, but the loss of 1100 plum jobs isn’t the only thing to be disappointed about.

Keep in mind, these service jobs aren’t being outsourced to some ultra-low-cost haven like Bangalore, or even a low-cost state like Texas or North Carolina where many other Massachusetts jobs have fled over the years. They’re going just a few miles away over the border to Merrimack, NH and Smithfield, RI.

Listen to Jon’s commentary:

Why? Explains State Rep. Steve Levy of Marlboro, where the Fidelity jobs were located: “Massachusetts lacks the competitiveness to compete for jobs. It’s the overall business climate: utility costs, workforce costs, unemployment insurance and workers comp.”

If all that sounds familiar, it’s because that is the same litany of private-sector complaints we’ve been hearing around here for the past 40 years.

The simple truth is that it’s more expensive to do business here than it is in other states, and guess what? In this day and age, many jobs, certainly those created by a financial services company like Fidelity, are highly mobile. The work can be done anywhere.

What’s that? Others can’t match the natural beauty, culture, and intellectual environment of Massachusetts? Once true, perhaps, but not anymore, and even if it were true, Smithfield and Merrimack are an easy drive to anything Massachusetts has to offer.

So yes, Lieutenant Governor Murray, we’re disappointed too. But we’re not surprised that a business chose to leave for greener pastures because Massachusetts politicians for decades have failed to fix our crippling competitive disadvantages. Fidelity would probably have done this long ago if the family that founded it wasn’t rooted here. Time for Beacon Hill to drop the baby talk and get serious about repairing our job-repellent business climate.

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  • Jeff Kingston

    Others can’t match the natural beauty, culture, and, Life the Way It Should Be.”

    The State of Maine has used this tire phrase for years and you see what a mecca for business they are!!

    Old, tired, quarter truths don’t do the job. Aggressive tax structures, competitive unemployment insurance and worker’s comp insurance rates should help to save some jobs, but will never bring them back. Mr Patrick and the rest of our elected officials need to get their head out of the sand and fast-track adjustments to these issues or Massachusetts will end up like Maine, empty of jobs and devoid of hope.

  • taxedout

    People in this state wanted to keep the Same people in charge after the last election. Promises of jobs , is even worse here than the Gov’s friend’s promises. Happy with the direction we are going in???

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  • Stephen Stein

    I am not a Massachusetts employer, but I would like to know what ARE those comparative costs Rep Levy is talking about? And what costs can “Beacon Hill” control? They can’t control employee salaries or rents, and they have little control over utility costs. How about the unemployment insurance and workers comp? How much higher are they here than in RI and NH?

    • jerrty

      They do control some utility costs. The state has burnded the tax payers with a Cape Wind boondoggle that could double the electric rate for consumers and Mass. businesses. Taxachussets title comes for good reasons.

    • Jekyll Isle

      Just the unemployment burden on business alone is enough. MA business fund the entire program and costs/taxes have increased by 40% per employee each year to offset the expenses of the program. As of now employers pay over $61 per employee while the next closest state CA pay a 3rd of that.

      If you look at health care per employee then the burden expands. Business can choose to cover at 33% of all premiums or none & take a $1,500 per quarter fine for not covering employees.

  • S

    Well, MA just passed a law that individuals are no longer allowed to purchase their own health insurance if their employer offers an insurance plan. So, the cost of hiring employees and having employees in MA has just gone up – employers will now have to pay health insurance benefits for EVERY one of their employees (except for those who get insurance through a spouse) instead of having some employees who opt to purchase an indivudual plan for personal reasons. Way to go Beacon Hill! As an employee who has long purchased my own health insurance because I can get a better individual plan than the plan my employer offers, I’m now seriously considering relocating to one of the nearby states where I’d have the freedom to purchase my own health insurance. It’s not just the employers who are leaving the state because of decisions made on Beacon Hill – it’s also residents who are tired of the stupidity of our lawmakers!!!!!

    • Stephen Stein

      A good employer like Fidelity is going to offer health insurance anyway, so that cost is going to be there whether they’re in MA or RI or NH.

    • LindaMary

      Please tell us what kind of health insurance is better and cheaper than employer-supported health insurance. Where did you get it and what does it cost – I have never heard of such a thing.

    • Charlie

      I left, it’s worse culture wise, I came back with my wife, never leaving again, I thank god everyday that Im from new england, I left and went south, never again, the only problem around here is it is a little to quiet living out by 128, esp when me and my wife want something to eat past 10pm, and train doesn’t run past midnight, like I said some of our kids leave for warm weather only to return 5 years later after they grow up, worst place to be for ages 21-30,

    • StanleyRamon

      @S- That law has been in effect for a few years and I believe employers are required to pay at least 33% of your premium. I’m not sure what type health insurance you can get for yourself that would be less than a group rate and partially paid by your employer.

  • mikey

    Lets not be too rough on Gov. Patrick as Fidelity is running for the exits, after all Patrick is doing his best to improve the economies of Israel and Britian by spending our money while traveling.

  • KathyD

    I have a friend that worked for Fidelity for years. They were supposed to move the Marlboro operation to NC. I wonder what NC did to lose their favor. Or maybe they decided they didn’t want to lose all the experience and start from scratch.

  • Jon Keller

    Say what you will about Evergreen, the jobless junket, and other questionable moves by Gov, Patrick, the underlying fiasco can hardly be blamed on him. I remember business screaming about unemployment insurance costs during the Dukakis years; three decades later, we still have the 2nd highest rates in the country There’s a lot more to the cost of doing business here than Rep. Levy mentions in his quote, and the job-repelling force of it has been building for many years, hardly deterred by inept Democratic leadership and toothless Republican governorships.

    • Stephen Stein

      I’d really love to see some specifics about the cost of doing business here. After all, it’s a vitally important question, and just griping about “high costs” without knowing what we or our legislators can do about it is pretty useless.

      Anyone know this issue in depth?

    • mikey

      “Inept Democratic leadership and toothless Republican governorships.” Yeah, this is a “blue state” for business – black and blue.

  • Summer St Troll

    Fidelity has been steadily losing institutional benefits (401k’s etc. ) clients, mostly to Vanguard Group. While Fidelity may call this a transfer, it’s really a staff reduction and a move from leased to less costly owned space. It is disingenuous to classify this as a transfer of all 1,100 jobs out of Massachusetts unless Fidelity is promising continued employment everyone affected.

    • Stephen Stein

      As I understand it, the job reductions at Fidelity already happened. This gave them plenty of empty space at all their facilities and this move represented a consolidation from 3 under-utilized offices to 2 more fully occupied spaces.

  • response

    “Keep in mind, these service jobs aren’t being outsourced to some ultra-low-cost haven like Bangalore, or even a low-cost state like Texas or North Carolina where many other Massachusetts jobs have fled over the years”

    Fidelity sent thousands of jobs that way in the past. Those jobs have been gone for years. (India)

  • Lucy

    An employer (large accounting firm) closed its office in Manchester and relocated at least some employees to Boston. Fidelity has a history of laying people off and doing things like this. It’s deceiving. They received generous tax incentives from our gov’t – courtesy of the taxpayer btw. They are reducing their employee force, again. Wall Street strikes again. A lot of these problems we face are the result of Wall Street being married to the government. It doesn’t matter which party is in office. Neither represent the middle class. We need unemployment insurance. It’s not that generous. It’s enough to keep you floating until you can find employment. We need to do more for ourselves locally. Laws keep that from happening.

    • response

      Fidelity is still a privately owned company….Wall Street has nothing to do with the fact they are moving.

      • John

        Fidelity is actually hiring. Seeing as myself along with 20 others have just been hired

  • Lucy

    Government can work but the people need to unite and focus on economics. The government has a critical role. The people have to be the watch dogs. We have to organized and be loud about what we want. We need good information. You cannot trust the major media because they have been part of the problem. Look to independent media to get the more complete stories and the stories that are missing. We have to organize and unite. Who is more entitled than the richest among us?

  • justsayin'

    Keller sounds peeved at both MA politicians and the stagnancy of the state’s business growth policies. I must agree but the larger problem is that MA will likely never change. It’s the way its been, and as far as pols are concerned, the way it should stay! Please don’t declare the state of MA to be some intellectual sanctuary. It’s so disgustingly liberal that when I see Gov. Patrick and so many other legislatures here in MA that I want to puke….the state of MA is a sinking ship, jump out if you can. The cost of living for senior citizens and many working class is terrible and likely to become worse. I’m moving to VA as soon as possible, I hate the way MA has been managed through the years I’ve lived here. When the state budget comes up short, raise fees and taxes on everybody that has a W2. Count me out along with Fidelity…

  • FireGuyFrank


  • Stephen Stein

    Fidelity’s move more than doubles the commercial real estate vacancy rate in Marlborough – it’s going to be 49% after they go!

    • KathyD

      I saw that Marlboro made some list of the top 10 places in the country to live – one of the reasons was the corporate presence there. HP left their huge complex in the past year and have 95% of the staff and contractors working from home. They want to save on facilities and real estate cost. That’s been a long-term goal of there’s for many years.

      Smart strategy. Make your business “virtual”, send the costs of doing business onto the backs of your employees, and ditch all state taxes except for the one in which you hold your corporation.

      You’ll see many more doing the same.

  • BostonIrish

    I guess I’m not surprised that yet another company has chosen to leave Mass. I’m just surprised it took everyone else by surprise. The business climate has been this way for a long time. This didn’t just suddenly happen. State government greed. That’s the constant. Increases in taxing and spending. That’s another constant. Revise upward the budget. Eventually the well runs dry. Time for the taxpayers to pay more. Big business just isn’t cutting it.

  • So firms are fleeing Mass. for business-friendly RI? | Blogs

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  • Governor: Trade Trip A Success, Upset Over Fidelity’s Move « CBS Boston

    […] Fidelity’s announcement that it planned to close its Marlborough office and move about 1,100 jobs to facilities in Rhode Island and New Hampshire left him frustrated as well as disappointed, said Patrick, who planned to meet with company leaders to ask why the state wasn’t given a chance to “compete” to keep those jobs. READ: Keller @ Large: Why Did Fidelity Move Jobs To NH, RI? […]

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