Panels: Howard's economy improving, but slowly

Committee optimistic amid mixed signals

February 17, 2011|By Larry Carson, The Baltimore Sun

In the three recession years ending in mid-2010, Howard County netted just 83 new jobs, according to state labor figures, but local officials are proud to have seen any growth at all — especially compared with big losses in surrounding counties.

Over that same period, Frederick County lost a net 2,257 jobs, Anne Arundel lost 4,401, Baltimore County lost 10,394, and Montgomery County lost 14,034. Across all of Maryland, the net job loss was 65,089.

"We were the only county in the area to gain jobs," county finance director Sharon Greisz told a combined meeting of the county's Economic Outlook and the Spending Affordability committees Wednesday morning at the George Howard building in Ellicott City. The two groups are trying to see into the future and help the county prepare a budget for fiscal year 2012. County Executive Ken Ulman presents his budget in mid-April.

County budget director Raymond S. Wacks told the group that income tax revenues will be the key to revenue growth next fiscal year, and that is hard to predict given mixed economic signals.

The two groups were formed by the county in the early 1990s after a major recession, he said, to help county leaders better understand where the economy, and thus the county budget, may be headed.

The groups are composed of business owners and operators, including auto and home sales, retail, commercial leasing, and banking. Also involved are lawyers, accountants and a variety of county officials. Members said some aspects of the business climate are improving, while others remain stuck in the doldrums.

Greisz also described a shift in the types of jobs that are growing. As retail, sales, construction and other traditional jobs declined, she said, government, health care and other white collar professions grew. That partially suggests the positive influence on Howard of nearby federal government jobs, she said. Still, other businesses are making gains too.

Apple Ford saw sales go up 34 percent in January compared with the same month in the previous year, and the Columbia dealership increased jobs from 112 to 158 over the past 18 months, said George "Chip" Doetsch, who runs the family-owned dealership. He said 2010 "was our best year ever."

Chris Myers, owner of SuperBookDeals, a Howard-based online book retailer, said he offered no pay raises to employees for the past two years, but he's giving raises this year and he's hiring, too. He had 2,600 applicants for four openings, he said, though the vast majority did not have the computer skills he needs.

At the same time, Myers said, the recession's pressures recently helped him buy a 13,000-square-foot Columbia office building for a needed expansion and relocation at a bargain price. "The sellers were desperate," he said, adding that they lowered their price 30 percent to match a low appraisal.

"Small-business owners are modestly optimistic about 2011," said Jim Peacock, an accountant. "Any business that made it through the last few years [is] in better shape than before," he said, because they've cut costs and become leaner operations. "I think things are turning around."

Retail sales are up 14 percent at Costco's big warehouse store in east Columbia, said David Liby, manager of wholesale buying. Harry L. "Chip" Lundy Jr., president and CEO of builder Williamsburg Group LLC, said Howard County remains a "great place to do business," even though his firm lost money in 2007, 2008 and 2009. "Last year we broke even," he said, but sales are up in 2011, though his firm is now building more $475,000 townhouses instead of $1 million mini-mansions.

"It is not a pretty picture, but it is getting better," said Lundy. With expected growth from the increased federal defense hiring and the redevelopment of downtown Columbia, he is "optimistic about the future."

Commercial real estate is still depressed, said Cole Schnorf, senior vice president and director of development for Manekin LLC, a Columbia-based commercial construction, leasing and management firm, but things are leveling out. Although real estate sales aren't great, Nancy Cummins of Long and Foster Realtors said, "The rental market is fantastic." Rising mortgage interest rates are spurring some people to action, too.

"People are thinking, 'This is the bottom, we should jump on now,'" she said.

Todd Snyder, a lawyer with training in economics, said Howard County is an unusual place, seemingly sheltered from the worst of the recession's effects.

"Howard County is sort of insulated from the rest of the world so much," he said. The county's 5.2 percent unemployment rate is the lowest in Maryland and far below the nation's 9 percent rate, and committee members said foreclosures and short sales remain a small slice of Howard's real estate market, unlike Prince George's County or economic disaster zones like Florida, California and Nevada.

Still, Snyder said, the relative prosperity of the local economy worries him sometimes. "Eventually, you've got to wonder if things [elsewhere] can pierce us."

larry.carson@baltsun.com

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