UM economist says state has bottomed out Straszheim expects 1993 turnaround

September 15, 1993|By Kim Clark | Kim Clark,Staff Writer

Mahlon Straszheim, the economist who annoyed Gov. William Donald Schaefer by predicting a recession for Maryland in 1990 -- accurately, as it turned out -- yesterday said the state has finally hit economic bottom.

Dr. Straszheim, who has since been hired by the governor to provide economic analysis for the state government, said he foresees "slow, sustainable growth over the next 18 months, with the recovery gaining momentum" probably by 1995.

Dr. Straszheim told a group gathered for a University of Maryland showcase of its business partnership programs that improvement in sales tax collections and other statistics indicate "this year will be the year the economy turned around in this state."

But in his speech before Maryland business people, economic officials and top educators, the UM economist showed he hadn't lost his bearish outlook completely. He offered little immediate hope for an improvement in the job market, for example.

Because business people are investing in labor-saving machinery instead of new hires, he doesn't expect the number of jobs in the state to improve much in 1993. This year "will be a transition year. Our employment growth will be below that of the rest of the nation."

But there is hope, he said. Dr. Straszheim expects Maryland's job market to surpass the national average sometime in 1996.

The best job opportunities will probably come from small start-up companies in hot fields such as pharmaceuticals or computer services. "The life sciences are going to grow tremendously," he said.

Job prospects in more traditional fields, such as banking, insurance or real estate, will likely continue to be grim, he said.

Dr. Straszheim expects to see further consolidation of the state's banking operations, saying, "We have more banks than we need."

He doesn't expect to see a really robust local and world economy again until 1996, and then only under certain conditions. If inflation and interest rates remain low, and Europe and Japan emerge from their recessions in a year or two, then economic activity will likely rebound dramatically, he said.

MARYLAND INDUSTRIAL PARTNERSHIPS

... ... ... ... ... ... ... ... ... ...1992... ... ...% change

... ... ... ... ... ... ... ... .employment... ... .1988-1992

Life sciences

Drugs manufacturing... ... ... ... ...3,322... ... ... +58.9%

Med., ophthalmic instrument mfg... .. 2,426... ... ... .. 19.1

Medical instrument wholesale... ... ..3,242... ... ... . 52.3

Information services

Computer and data processing... ... ..37,631... ... ... +9.2%

Commercial research firms... ... ... 17,652... ... ... . 16.4

Noncommercial research and testing... 8,641... ... ... .. 17.7

Services related to Md.'s econ. success

Legal and accounting... ... ... ... .26,597... ... ... .+6.9%

Management and business consulting.. 23,343... ... ... .. 14.8

Health services... ... ... .. ... . 170,105... ... ... . 20.5

Securities and commodities brokers... 6,287... ... ... . 15.7

Social services and leisure time... .62,299... ... ... . 26.2

Baltimore Sun Articles
|
|
|
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.