Trades work on rise in Md.

Agencies' studies signal pickup in construction

Jobs for plumbers, electricians

October 20, 2002|By Raymund Lee Flandez | Raymund Lee Flandez,CAPITAL NEWS SERVICE

Maryland's economic and labor departments have released figures showing the state's construction industry may be enjoying a rebound - good news for the state's lagging economy.

Construction companies surveyed reported that they expect a fourth-quarter turnaround and anticipate hiring more than 1,000 workers overall.

Because the construction industry is usually a leading indicator, Maryland economic experts are optimistic about the state's business prospects.

Separately, McGraw-Hill Construction Information Group reported that the value of residential building contracts in the state in August was $435.1 million, up 11 percent from $390.4 million last year.

For the eight months through August, residential building work in the state totaled $2.77 billion, down 2 percent from $2.82 billion last year. Nonresidential building was down 24 percent in August to $178.8 million this year from $234.5 million last year.

"The construction sector truly was one of the hardest hit," said Pradeep Ganguly, chief economist for the state Department of Business and Economic Development. "But we expect that this sector will lead the recovery in the second half of 2002."

The construction sector lost a net of 877 jobs from December to May but is expected to add a net of 1,116 jobs, according to the 629 firms surveyed. High business costs and a labor shortage were major factors in the industry's contraction.

But a change is imminent. The effects of the national recession are beginning to wear off, state officials said.

According to the statewide survey, special trade contractors, such as plumbers, electricians and roofers, are likely to provide the majority of the anticipated new jobs, with 819 by December. Bridge and road construction will add 285 positions. But building construction is not expected to add workers.

"We hired eight new people so far this summer in anticipation of the fall," said Matthew Helminiak, manager of Carroll Insulation Co., which is training these employees in anticipation of more business in the cold months.

Seasonal changes, low interest rates and an expanded market share through companies consolidating propelled the new hires.

Since the latter half of last year, construction employment slipped to a new low of about a 6 percent job loss in May. Statewide, about 161,000 workers are involved in construction.

The Baltimore and Washington areas accounted for most of the losses, 490 and 411 respectively, the companies reported. Southern Maryland, however, gained 58 positions, mostly through federal contracts.

The survey, conducted by DBED and the Department of Labor, Licensing and Regulation in May, asked participating construction companies not to include jobs lost or gained through seasonal turnover from the period six months before June. It also asked them to predict new hires for the six months following June.

Washington-area companies are expected to hire 604 people and Baltimore-area companies 355 this fall. The rest of the state will see small gains in construction jobs.

"The direction it tells me is that it was sliding," Ganguly said. "It had difficult times. But the next six months looks promising."

Although the national economy has showed signs of a "moderate" recovery, the state still is slowing markedly because its recession started a little later than in other states, Ganguly said.

With the construction industry touted as one of the first sectors to recover, he said, the figures could also mean an upswing in the state's economy.

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