Jobless rate in Md. dips to 3.6%

Jan. reading is lowest since March 2001 as payrolls grew by 2,000

March 10, 2006|By LORRAINE MIRABELLA | LORRAINE MIRABELLA,SUN REPORTER

Maryland employers added just 2,000 jobs in January, but the state's jobless rate dipped to a healthy 3.6 percent, the lowest level in nearly five years, the U.S. Labor Department said yesterday.

January's jobless rate was Maryland's lowest since March 2001, when it was also 3.6 percent. Maryland has not recorded a jobless rate below 4 percent since April 2001.

The decline in the jobless rate from December's 4 percent and job gains across most sectors reflect the state's strong employment picture, in which some employers now face labor shortages, economists said. Some said they expect the month's relatively slim job gains to be revised upward.

"This is the lowest unemployment rate we've seen in quite some time in Maryland, and it is consistent with the notion that job growth continues at a rapid clip in Maryland," said economist Anirban Basu, chairman and chief executive of Sage Policy Group Inc. "The jobless rate has gone down, but the demand for new workers has not. Employers either have to search for new employees out of state or recruit them from existing firms. One of the things Marylanders should anticipate as we move toward 2007 is that employees will gain some measure of negotiating power."

The state, a big beneficiary of federal spending, continues to perform better than the nation as a whole, which had a 4.7 percent jobless rate in January. The state has added 33,700 jobs over the past 12 months, the Labor Department said. The numbers, which are preliminary, are adjusted for seasonal variations.

"The Maryland economy is remaining strong," said Richard Clinch, director of economic research at the University of Baltimore's Jacob France Institute. "We never really had a recession, unlike the nation, in 2001. What was declining nationally we don't have a lot of and what is growing we do, such as defense and government spending.

"The fact that manufacturing had declined years ago made us different from the Midwest," Clinch said.

Maryland showed gains in employment in all sectors except government and professional and business services. The strongest gains came in the trade, transportation and utilities sector and in education and health services, a main economic driver. But the state was able to add several hundred jobs even in manufacturing, reflecting the growing strength of manufacturing nationally, economists said.

The relatively paltry gain of 2,000 is a preliminary number that likely will be revised up rather soon, Basu said.

"There is nothing in this economy to suggest that job growth is slowing in any meaningful way," he said.

Kirsten Sauter, a business development specialist in the Owings Mills office of Manpower Inc., a staffing agency, said job orders from employers seeking workers now average about 20 or more a week, up from five to 10 a week for much of last year.

"We have been seeing an increase in our job orders, in the mortgage area and financial companies," Sauter said.

"We're also seeing an increase in industrial services, such as warehousing, shipping and receiving. Companies are having trouble finding the right candidate."

Employers seeking managerial and salaried employees are having more difficulty filling positions than employers seeking hourly or production workers, said Steven Director, a professor in the school of management and labor relations at Rutgers University. He puts out an employment survey with the Society for Human Resource Managers.

"The really good people looking for positions have been grabbed up," he said.

Maryland was one of 47 states to record lower unemployment rates in January, the government said.

Prospects for job growth in the state appear rosy at least for the next few years, with the nation's military realignment expected to bring more jobs to the state, Clinch said. The state is on track to add 50,000 jobs this year, he said.

But Clinch cautioned: "This government spending is unsustainable from the current deficit standpoint, and we either have to slow the growth of spending or raise taxes, and this will hurt Maryland."

lorraine.mirabella@baltsun.com

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