Reversing the Jobs Exodus

March 31, 1992

A government study has put the lie to the notion that Maryland's dependance on stable industries would shield it from the ravages of recession. The U.S. Labor Department estimates that the state lost some 75,000 jobs last year, 29,000 in Baltimore. The 3.4 percent drop was the worst showing of any state from New Jersey to Georgia. The news was even worse in Baltimore, where the labor pool shrank 6.3 percent. The urban component doesn't begin to explain the decline -- Philadelphia registered a far more modest drop of 3.5 percent; Washington D.C. lost 1.3 percent.

These numbers are disquieting but hardly surprising. Manufacturing has been on the ropes here for years. The alternative economic hub built around services has been buffeted by cyclical and structural winds. Defense continues to weaken in the face of cutbacks in Pentagon spending. Less obvious are regional disparities that have corralled economic growth largely within Baltimore and Washington suburbs.

The new report is about more than what the recession has done to Maryland's employment base. It mirrors seismic structural shifts that have wrought profound, perhaps irreversible changes in Maryland's economy. To their credit, state policy makers are focusing on education, life sciences, creating a seed capital fund and emphasizing international trade.

An impressive consensus exists among those familiar with the state's economy about what needs to come next. In his paper, "Maryland and the New World Economy: Challenges and Opportunities," Johns Hopkins Institute for Policy Studies director Lester M. Salamon suggests a regional approach to assessing and taking advantage of this state's considerable assets. The real competitors of Maryland jurisdictions, he declares, are not other subdivisions, but other states and nations.

Given the state's scarce financial resources, strategic choices must be made to target and nurture promising industries. Another priority is an educational system capable of turning out a skilled labor force and more concerted efforts at training and retraining. Another is getting more bang for the state's technology buck by moving inventions out of the laboratory into the marketplace.

The recession's effect on Maryland's employment base has been serious thus far. What should be remembered is that Maryland's troubles are rooted in not only the current downturn, but systemic changes. Unless these are addressed, the news from the Labor Department could be much grimmer next time around.

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