Md. jobless rate falls

3.4% is lowest in 6 years

2,705 jobs added in March

April 22, 2006|By LORRAINE MIRABELLA | LORRAINE MIRABELLA,SUN REPORTER

Maryland's unemployment rate dipped to its lowest level in six years in March, the federal government reported yesterday, with the strong presence of government jobs continuing to boost the state's job performance.

The state's jobless rate dropped to 3.4 percent in March, down slightly from 3.5 percent in February and significantly better than the nation's rate of 4.7 percent last month, the U.S. Labor Department reported. Maryland's rate hasn't been this low since April 2000, when it was also 3.4 percent.

Employers in Maryland added 2,705 jobs during March, according to preliminary seasonally adjusted numbers from the Bureau of Labor Statistics.

Maryland has gained 43,500 jobs since March 2005, bringing the state's employment to 2.87 million jobs.

"Maryland continues to boast one of the nation's lowest unemployment rates, and the trend is unmistakable; it's falling," said Anirban Basu, chief executive officer of Baltimore-based Sage Policy Group Inc.

Federal spending has been driving the state's economy and creating jobs, giving Maryland nearly three times the rate of federal employees compared with the national average, said Richard P. Clinch, director of economic research at the University of Baltimore's Jacob France Institute. Additionally, the state's private sector has been adding technology and biotechnology jobs.

Clinch estimates that about a third of the state's businesses are experiencing worker shortages, but that more companies - in all sectors - will face an employee crunch in the future.

"Because of this shortage, wages are going to have to go up," Clinch said. "There are not a lot of surplus workers out there. It bodes well for the city, and for immigrants. People who had not been engaged in work, as wages go up, will engage in work," he said.

Basu said Maryland's fast-appreciating housing market and higher-than-average housing costs appear to be a barrier to growth of the labor force.

"Housing costs are precluding many job seekers from locating in Maryland," Basu said.

"People in surrounding states would like to access Maryland's job market but cannot because they cannot find a place to live that is both desirable and affordable," Basu said.

The biggest job gains in Maryland came in the education and health services sector, which added 10,600 jobs in the 12 months ending in March.

The government sector had the second-biggest gain, adding 9,500 jobs over the year, with the professional and business services sector not far behind, adding 8,300 jobs.

The state's manufacturing sector continued to lose jobs, with employment falling by 3,700 jobs, the data showed.

Unemployment rates in the region, which are not adjusted for seasonal variations and have only been updated through February, were 2.6 percent in Howard County; 3 percent in Carroll County; 3.1 percent in Anne Arundel County; 3.5 percent in Harford County; 4 percent in Baltimore County and 6.4 percent in Baltimore City.

In the long term, any pullback in government spending would hurt the state, and past recessions have lasted longer in Maryland because of the loss of government jobs, Clinch said.

But any impact of reduced government spending could be lessened because of the 54,000 jobs that are expected in the state because of to the government's military base realignment.

"That's a whole year's job growth spread over a three- to five-year period," Clinch said.

"There's no reason to expect a downturn in Maryland in the near future. Things are fundamentally strong," he said.

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