Job growth expected to lag in state

January 20, 1993|By David Conn | David Conn,Staff Writer

Maryland's economists and business leaders are treating the state economy like it's Punxsutawney Phil, the nation's official groundhog: If they cross their fingers and watch closely, they believe, they can see signs that an economic springtime is just around the corner.

That was the tone at yesterday's second annual Maryland Chamber of Commerce Economic Outlook, presented to several hundred people at the Stouffer Harborplace Hotel.

"The Maryland economy is expected to show moderate growth in terms of gross state product, personal income, retail sales and tax revenues," said a report prepared for the chamber by a panel of economists at several of Maryland's colleges and universities.

"Job growth, however, is expected to lag behind these other indicators, and could lag the national recovery in job growth for the next 12 months," the report said.

Among other things, a tightening of monetary policy by the Federal Reserve Board could stifle the recovery, said Sen. Paul Sarbanes, a Maryland Democrat and co-chairman of Congress' Joint Economic Committee. "We're very anxious that the Fed not tighten money," he said. "We think that would have the impact of cutting the recovery off at its knees."

Absent such an action, forecasts of annual economic growth in Maryland ranged from 4.6 percent, from Chang M. Kong, chairman of Towson State University's economics department, to a 1.5 percent, shared by John Larson and Mark Meador, of Loyola College's Institute for Business and Economic Research, and by Mahlon R. Straszheim, who chairs the University of Maryland at College Park's economics department and serves as consultant to Gov. William Donald Schaefer.

Mr. Schaefer, on hand for the conference, said he was relying on Mr. Straszheim's predictions more than those from economists who predict 3 percent growth or greater.

"All the sudden everyone says there's going to be great growth, and I think there will be," he said, but added that his budget, based on Mr. Straszheim's advice, would be conservative.

While bullish on the state's economy, Mr. Schaefer had a cautionary word for the businesspeople in attendance. "I'm not as optimistic in the city of Baltimore. I don't think the business community has pushed hard enough to push the city," he said, citing the expansion of the Convention Center as a project that needs the community's support.

The report showed a consensus of nearly 5 percent growth in personal income in 1993, but only about 1 percent job growth this year.

If they come at all, the jobs would be in Baltimore's and Washington's "edge cities," a term coined by author and consultant Joel Garreau, who was yesterday's featured speaker.

Mr. Garreau defines edge cities as areas with at least 5 million square feet of office space, 600,000 square feet of retail space and an area with at least as many jobs as homes. Examples in this area include Tysons Corner in Virginia and Towson and

Hunt Valley, north of Baltimore.

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