Md. jobless 6.2%

Recession sends Jan. unemployed to a 16-year high

March 12, 2009|By Lorraine Mirabella | Lorraine Mirabella,

Maryland's jobless rate spiked over 6 percent in January, climbing to a 16-year high in the midst of the deepening recession, preliminary government figures released yesterday show.

Economists said they were surprised at how rapidly employment weakness has accelerated in Maryland, though the state still fared better than the nation. The country's unemployment rate hit 7.6 percent in January and 8.1 percent last month, the highest rate in more than 25 years.

The state's jobless rate, adjusted for seasonal changes, rose to 6.2 percent in January from 5.4 percent in December, the U.S. Department of Labor reported. More than 185,000 Maryland residents were actively looking for work in January.

Maryland has been cushioned somewhat from the high percentages of people out of work that many states are seeing.

Michigan's unemployment reached 11.6 percent in January, the highest in the country, followed by South Carolina, at 10.4 percent, and Rhode Island, at 10.3 percent. Unemployment has been lower in Maryland thanks to federal and government contractor employment and spending.

"The good news is we're doing better than the nation," said Richard Clinch, director of economic research for University of Baltimore's Jacob France Institute. "The bad news is we're going to catch up. Businesses have lost confidence that this is going to be a shallow recession and are starting to cut spending and hiring. Until the national economy shows signs of recovery, we'll see more of the same."

Every state but Louisiana had increased joblessness in January, and all 50 states had higher unemployment than in January 2008, the data show.

Maryland's unemployment rate was 3.6 percent in January 2008. During the 12 months through January, Maryland has lost 39,000 jobs, the statistics show. On a nonseasonally adjusted basis, unemployment jumped to 6.7 percent in January, from 3.9 percent in January 2008.

"Financial troubles have made households feel constrained about buying homes or cars or restaurant meals or most anything," said Charles W. McMillion, chief economist for Washington-based MBG Information Services. "And therefore businesses are not investing, and they're not hiring."

Job losses have come in nearly every sector in Maryland. In January, Home Depot Expo said it will close stores in Columbia and Bethesda in April and lay off 189 workers. Direct-marketing company Vertis Communications announced this month that it will close its printing plant in Belcamp, in Harford County, and lay off 114 people.

A layoff two weeks ago came as a shock to Patti Delaha, a 48-year-old White Marsh resident. She had worked at a Towson health care company for 11 years, the past six as an administrative assistant in the marketing department. She said a number of positions were cut.

"I had a false sense of security," she said. "I didn't think my position could ever be eliminated."

Delaha, who has worked as a teacher, receptionist, travel agent and contract coordinator, said it's the first time she has faced a layoff. She hopes to find an administrative assistant job in health care or in education.

"There are a lot of jobs out there, but not too many in my particular field, and when there are, they often don't pay nearly as much as I was making," she said.

Rising unemployment will likely mean no shortage of workers this summer in Ocean City. An annual job fair last weekend in the beach resort town attracted more than 3,000 job applicants - more than three times what was expected, officials with the Greater Ocean City Chamber of Commerce said. Besides the usual mix of high school and college students, job applicants included older, more experienced workers.

"What we're seeing is something we haven't seen in years; typically, we've relied on a lot of foreign employees for our work force," said Todd Ferrante, the chamber's president. "But because more people are out of work, we're seeing more people apply from the local area."

Despite rising joblessness, the state added 6,000 jobs from December to January, the government said, which economists explained as a possible seasonal blip. Maryland added jobs each month for most of last year until September, when credit and financial markets collapsed and employers began trimming staffs with more urgency. The state's jobless rate has been rising steadily since May after remaining below 4 percent for more than two years.

It's unusual to see unemployment rise so fast in Maryland, McMillion said, in part because unemployed Marylanders are likely to move to a state with a lower cost of living. But the high numbers of people seeking work could mean some who might have left have not done so, possibly because they're unable to sell a home, he said.

"People who lose their jobs in Maryland, more than in most places, leave," he said. "Maryland is an expensive state to be unemployed in," but "this hit the state so quickly."

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