Donald Fry: Maryland’s jobs recovery is under way, but it’s sluggish

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By Donald C. Fry

The economic recovery has, technically, been underway since June 2009 – the date when experts say the Great Recession officially ended. But recently-released employment data tend to reinforce perceptions, in terms of job creation, that this recovery is off to a choppy start.

Data from the U.S. Department of Labor, the state’s Comptroller’s office and Manpower, Inc.’s quarterly employment outlook survey all paint similar pictures of the recovery in Maryland.

From a jobs standpoint, Maryland bottomed out in February 2010, when non-farm payroll employment fell to fewer than 2.5 million – 145,000 jobs less than two years earlier, when payroll employment peaked in our state.

Since the February 2010 bottom, Maryland’s non-farm payroll job count showed gains for three consecutive months. But it has receded somewhat since then, decreasing in seven of the eight months between May 2010 and January 2011, the most recent month for which federal jobs statistics are available.

For Maryland, the preliminary January 2011 employment data from the federal Bureau of Labor Statistics brought both good news and bad news. The good news is that Maryland’s unemployment rate dropped to 7.2 percent in January – the 12th lowest in the U.S. Less encouraging is that Maryland’s payroll employment decreased by 7,100 jobs from December 2010 to January 2011. In terms of raw numbers, only four states – South Carolina, Florida, New Jersey and Georgia – experienced greater one-month employment erosions.

But year-to-year from January 2010 to January 2011, total employment in Maryland increased by 4,600 jobs, a 0.2 percent gain, according to federal data. That ranks Maryland fifth among seven Mid-Atlantic states, tied with North Carolina for percentage job growth between January 2010 and January 2011. Pennsylvania (+1.3 percent), West Virginia (+1.2 percent), Delaware (+1.0 percent) and Virginia (+0.8 percent) experienced greater percentage job growth than Maryland.

Industry sectors in Maryland that experienced employment increases were trade, transportation and utilities; professional and business services, leisure and hospitality, and education and health services.

Jobs decreased in Maryland’s construction, manufacturing, and financial business sectors.

The Maryland Comptroller’s Office recently noted that our state’s economic recovery appeared to slow toward the end of 2010. As a result, the Board of Revenue Estimates recently decided not to make any upward revisions to its projections for state government revenue growth in the current fiscal year and in FY 2012.

Maryland's economy "continues to show signs of recovery,” the board reported in its March 9 letter to the governor that predicted a “slow but steady acceleration” for Maryland’s economy. But the board stuck to its December forecast, projecting a 3.3 percent growth in general fund revenue for FY 2012, which begins on July 1.

The $13.6 billion in general fund revenue forecast for FY 2012 is approximately the same as in FY 2008 before the recession. But the fund’s projected 3.3 percent revenue growth for FY 2012 amounts to only about half the fund’s average annual growth generated by Maryland’s economy between 2000 and 2008.

Meanwhile, recent employment outlook surveys by Manpower, Inc. suggest that Maryland employers are expecting job statistics to gradually improve. Manpower survey results issued on March 8 report that 18 percent of the state’s employers expect to increase staff levels in the second quarter – up from 15 percent in the first quarter.

This is encouraging, but it is nowhere near the 27 and 30 percent of employers reporting plans to expand their hiring in the pre-recession years of 2006 and 2007.

Though statistics from numerous sources show an uneven recovery for Maryland in terms of job growth, it’s fair to conclude that a recovery is under way, but that it is slow and gradual.

Employment data inherently vacillates over time, so it’s not appropriate, for instance, to get overly excited about short-term fluctuations, such Maryland’s employment decline in January. But it is well worth noting the longer-term chronic sluggishness of this recovery when it comes to job creation in our state.

It should remind our elected leaders in Annapolis that creating a competitive business environment that generates jobs and economic growth must remain their absolute top public policy priority.

Donald C. Fry is president and CEO of the Greater Baltimore Committee. He is a regular contributor to Center Maryland.

Previous Center Maryland columns by Donald C. Fry:

Maryland’s bioscience and technology industries are well worth nurturing

Maybe it’s time to change Maryland’s transportation funding model

Addressing the city’s towing kickback scandal head-on

Transportation funding bills get attention in Annapolis, but face major hurdles

Tapping into Maryland’s potential for innovation

A 23-year old leadership lesson from the Persian Gulf

Gauging the business contribution to state government funding

How the state lost its way on transportation funding

Budget proposal will be first big 2011 defining moment for lawmakers

GBC to lawmakers: ‘Make job creation and business growth top session priority’

Helping city’s new prosecutor implement a vision

A culture of ‘giving back’ lives in Maryland’s business community

Budget challenges will test government’s capacity for strategic planning

Facing the disconnect over the concept of ‘business climate’

Tax commission delivers refreshing change of pace

‘Reform’ commission to mull tax increase for Maryland corporations

No tsunami in Maryland, but voters deliver ripple of transition

Why isn’t transportation infrastructure crisis on lawmakers’ radar?

Market expert tells a pre-Halloween scary story

Entrepreneurs provide inspiration in a recession

Military is driving Maryland’s anticipated biggest economic spurt in 60 years

MedImmune CEO frames bright future for bioscience

Making transportation a top-tier priority

Primary voters in a mood for transition

Reading Maryland's fiscal tea leaves

Getting beyond sound bites and bumper stickers

Biotech tax credit more popular than ever, but the ‘rock-concert’ lines are gone

Bad timing for upcoming business tax report

For economic indicators, the ‘whipsaw’ effect continues

Do census data foretell a Baltimore city population rebound?

Remember the value of business after the election

New report ranks Baltimore among stronger regions to weather the recession

New living wage proposal: wrong idea, wrong time for Baltimore

Northeast needs more attention from federal rail planners

New national report has familiar ring for Maryland bioscience advocates

New report underscores Maryland’s work force development challenges

State’s health initiative: a ‘win-win’ for employers and their workforces

As Baltimore hikes taxes, are state’s counties next?

After the ‘fiber from heaven’ scramble, what’s next?

BRAC growth no longer a future event – it’s happening now

Economic development is a contact sport

Despite the recession, bioscience growth still percolates in Baltimore

State stumbles in enacting new education collective bargaining process

Wind power has potential in Maryland, but solar emerges as early renewable option

It's not good to be clueless in cyberspace

Amid fiscal shuffle, Maryland lawmakers pass measures to spur business growth

Thankfully, Baltimore leads with substance over style in luring Google

Leave damaging transportation provisions out of the budget

Amended budget continues recession-induced fund shifts and stimulus rescue

General Assembly setting stage for combined reporting push in 2011

Wrong timing for proposal to change Baltimore City school board

Baltimore City isn’t alone in facing pension funding challenges

A government investment program that delivers

Proposed transportation fund raid -- a bad habit continues

Where's the outrage over crime?

Small business is where innovation lives
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Donald C. Fry has been the president and CEO of the Greater Baltimore Committee (GBC), the central Maryland region's most prominent organization of business and civic leaders, since November 2002.

Under Don’s leadership, the GBC is recognized as a knowledgeable and highly credible business voice in the Baltimore region, Annapolis and Washington, D.C. on policy issues and competitive challenges facing Maryland. Its mission is to apply private-sector leadership to strengthening the business climate and quality of life in the region and state.

Fry served as GBC executive vice president from 1999 to 2002. From 1980 to 1999 Fry was engaged in a private law practice in Harford County. During this time he also served in the Maryland General Assembly. He is one of only a handful of legislators to have served on each of the major budget committees of the General Assembly.

Serving in the Senate of Maryland from 1997 to 1998, Fry was a member of the Budget and Taxation Committee. As a member of the House of Delegates from 1991 to 1997 Fry served on the Ways and Means Committee and on the Appropriations Committee.

Fry is a 1979 graduate of the University of Baltimore School of Law. He earned a B.S. in political science from Frostburg State College.