MD unemployment rate drops

Maryland's unemployment rate fell to 6.4 percent (PDF) in November, according to data released today by the Bureau of Labor Statistics, after stalling at 6.7 percent for the previous two months. This is the lowest unemployment rate Maryland has seen in almost five years.

The state unemployment rate fell in November because the number of employed Marylanders rose by just over 8,800 workers. The number of jobs in Maryland (these are two different measures-some jobs may be held by nonresidents, while some Marylanders may work outside the state) also went up, by roughly the same amount.

While this is welcome news, Maryland's economy still has a long way to go as it slowly recovers from the Great Recession. And the slow recovery is likely to continue: the Board of Revenue Estimates projected recently that job growth will continue to be sluggish in 2014 (PDF), at just 1.5 percent.

Maryland lawmakers will have the opportunity to take action in 2014 on a number of issues that could help working families, whether it's promoting job creation directly, providing supports to help while workers are between jobs, or investing in the things that make our state great (like our natural environment, our schools and hospitals, or the infrastructure that connects us. We'll be watching to see what they do. 

Wash Post: "How the 1 percent won the recovery, in one table"

The Washington Post has a great table up today, showing the results of a study (PDF) by economists at UC Berkeley, the Paris School of Economics, and Oxford University using Internal Revenue Service statistics. The bottom line: the top 1 percent have captured 95 percent of real growth in average income since the end of the Great Recession. No wonder income disparity is at its highest level since the First World War.

Why is that a problem? There are lots of reasons, but for just one look no further than another new study, this one from Ohio State University - children bear the brunt of economic inequality.

Here in Maryland we know that income inequality exists between different communities, ethnic groups, and education levels. Income for households in the top 1 percent increased 240 percent since 1979, while it grew just 10.8 percent for households in the bottom fifth.

That's why we continue to push for expanded programs to increase educational attainment, job opportunities, and the social safety net. As we begin preparing for the 2014 legislative session we will continue to support raising the minimum wage, providing workers with earned paid sick leave, and increasing the refundable state earned income tax credit.

CEOs’ favorite states: lower incomes, less education, less health coverage

Big business and anti-tax groups have been making hay out of a story in CEO Magazine in which a survey of CEOs ranked Maryland 41st in business climate. But look closely: a lot of the things that made CEOs downgrade Maryland (and the other states that ranked low in this poll) are actually things you would want for yourself and your family.

The results are based on a survey of over 700 CEO’s on the subjects of “Tax and Regulation,” “Workforce Quality,” and “Living.” So, what have these CEO’s told us about the states they like and don’t like? Here are their top 10 and bottom 10 states:

CEO Magazine Top 10	CEO Magazine Bottom 10
1. Texas	50. California
2. Florida	49. New York
3. North Carolina	48. Illinois
4. Tennessee	47. Massachusetts
5. Indiana	46. New Jersey
6. Arizona	45. Connecticut
7. Virginia	44. Michigan
8. South Carolina	43. Hawaii
9. Nevada	42. Pennsylvania
10.Georgia	41. Maryland

To find out how well the CEOs opinions tracked with the actual economic data, I looked at some indicators related to these twenty states. Median household incomes. Growth in per capita incomes. Poverty rates. Health insurance coverage. Education attainment.

 

Sources: CEO Magazine, US Census, MBTPI calculations

 

In each of these indicators, CEO Magazine’s bottom 10 states outperform their top 10. The blue bars on the graph show the average ranking of CEO Magazine’s top 10 states on these indicators. The green bars show the average ranking of CEO Magazine’s bottom 10 states. For example, the top 10 states, as rated by the CEO’s actually averaged the 28th highest median household income. Household incomes in the states ranked in the bottom ten were much higher – ranking 11th on average. In fact, CEO magazine’s 10 least favorite states included 6 of the 10 states with the highest incomes.

And it goes on like that for category after category. The states ranked lowest by CEOs had faster income growth, lower poverty, more health insurance coverage and more college grads. These are all things we want for ourselves and our families: we want to make a good living, to avoid poverty, for our kids to have a good education, and to have access to health care.

As business managers focused on their bottom lines, some CEO's might like to operate where they can get labor cheaply and without being expected to provide a lot of benefits.

As citizens, though, we want to promote good jobs that can support families, broad access to education, and health services.

This is not just an article in a trade magazine. This divergence between the interests of the short-term profit for investors and managers versus workers and citizens has a real impact on families in the real world. I know, because there was one measure I found where CEO’s top 10 lined up with economic realities: job growth.

CEO Magazine’s top 10 includes 8 of the 10 fastest-growing states in terms of employment over the past decade. The CEO top ten ranked 10th on average in job growth. The bottom 10 ranked 21st on average (Maryland fared better on this measure, ranking 11th).

And this helps to explain why workers are no longer benefiting from increases in productivity and why nearly all of the benefits of economic growth are going to the top 1 percent. These new jobs in the CEO-preferred states are low-quality (for the worker) jobs--lower paid, lacking benefits, and with few prospects for advancement.

CEO Magazine's kind of employment strategy is not what we want in Maryland. We need to continue to focus on maintaining our high standards for education and quality of life, and on attracting and retaining jobs that will help Marylanders thrive.

State leaders propose transportation package

Governor O'Malley, Senate President Mike Miller, and House Speaker Michael Busch released their transportation funding package yesterday (HB 1515/SB 1054). Maryland's transportation system has struggled for years with inadequate funding and the gas tax (which isn't indexed to inflation) hasn't been raised since 1992. Critical transportation needs are coming to a head in many states (see Virginia's recent transformation of its funding structure), and our state lawmakers finally have a plan to do something about it.

The proposal would raise $3.4 billion over five years. Here are the details, according to a graphic put out by the Governor:

Click to enlarge

This plan is a strong and sensible move toward more sustainable transportation funding. A healthier transportation system will help Maryland businesses and residents of all incomes live a better life.

However, we would advocate that the General Assembly add one more piece to the leadership's bill. Any expansion of the gas tax, sales tax, or other taxes or fees that disproportionately burden low-income families should also include an increase in the earned income tax credit. In fact, there are already bills before the legislature that would do just that. MBTPI strongly recommends that HB 845/SB 703 be made part of any transportation finance deal based on the plan put forward today.

21,000 more Marylanders employed

Yesterday Maryland received some good news from the Bureau of Labor Statistics when the latest jobs report showed that 20,977 more residents were employed in October than September. 5,104 fewer Marylanders were unemployed, and the unemployment rate dropped two tenths of a percentage point to 6.7 percent.

Click to enlarge

The state added a total of 14,000 new jobs during the month. The largest increases were in the professional and business services industry (+3,900); trade, transportation, and utilities (+3,700); leisure and hospitality (+3,700). The construction (+2,300), financial activities (+1,700), and education and health services (+2,700) industries also added jobs. Manufacturing (-2,300) and government (-2,700) lost jobs.

This is the lowest Maryland's unemployment rate has been since May, and the most private sector jobs created in one month since 1996.

While this is great news, there are still more than twice as many unemployed Marylanders as there were before the Great Recession. As Governor O'Malley develops the budget he will submit to the legislature in January, we urge him to continue to support and expand programs for struggling families all across Maryland.

US unemployment rises as hiring stagnates

The U.S. unemployment rate edged up one tenth of one percentage point in May, to 8.2 percent.  

From the Washington Post: "analysts say the country needs to add roughly 130,000 jobs per month for the recovery to maintain its momentum. But to truly make a dent in the unemployment rate, hiring must reach a sustained rate of 250,000 jobs per month. The country has hit that mark only three times over the past year and a half."  In June the economy added just 69,000 jobs nationwide.  Today's announcement also included downward revisions of the estimates for job growth in March and April.

Some sectors are doing well.  The health care industry has added 340,000 jobs over the past year, including 33,000 new jobs last month.  This is good news for Baltimore, where one in five jobs are health care related. Transportation and warehousing, wholesale trade, and manufacturing also added a combined 64,000 jobs in May. But the construction industry lost 28,000 jobs last month, and job creation in all other sectors was flat.

May employment figures for Maryland will be released on June 15th.

Groundhog Day: Labor Market Edition

Happy Groundhog Day!  While the groundhog predicted six more weeks of winter this morning, looking at the thermometer lately I have to imagine spring is just around the corner.  

But a groundhog’s shadow isn’t the only news we got this week.  New jobs numbers for Maryland highlight the need to prioritize investment in the building blocks of a strong economy, like quality schools, sound roads and bridges, and safe communities.  

Unemployment declined across Maryland in December, according to encouraging new numbers that the Bureau of Labor Statistics released yesterday.  The unemployment rate dropped in all four regions of the state -- Baltimore-Towson, Cumberland, Hagerstown-Martinsburg, and Salisbury -- compared to one year ago.*  

Metropolitan Unemployment Rate (not seasonally adjusted)	Dec 2010	Dec 2011	Change
Baltimore-Towson MSA	7.4%	6.8%	-0.6
Cumberland MSA	8.7%	8.0%	-0.7
Hagerstown-Martinsburg MSA	9.8%	8.3%	-1.5
Salisbury MSA	9.1%	8.6%	-0.5
Maryland	7.0%	6.5%	-0.5

Unfortunately, that doesn’t mean that the labor market is headed for an early springtime, too.  Economists still see shadows cast by the housing market and Congressional gridlock, among other indicators, and are therefore predicting a continued slow economic recovery.  While the numbers released this week are good news, it is important to remember that these unemployment rates are still significantly higher than they were four years ago and mask local differences because they cover large geographic areas.  In reality, many Maryland communities continue to experience higher unemployment than these numbers suggest.    

Given the sluggish recovery, creating jobs by investing in schools, transportation, housing, public safety, and the environment is more important than ever. As Governor O’Malley emphasized yesterday in his State of the State address, returning Marylanders to work and helping those who are between jobs or otherwise struggling must be a top priority.  The governor’s proposed budget does just that, and the General Assembly should take the same approach.

* BLS uses a Census Bureau geography called “metropolitan statistical areas” (MSAs).  Baltimore-Towson MSA includes Baltimore City and Anne Arundel, Baltimore, Carroll, Harford, Howard, and Queen Anne’s counties.  Cumberland MSA includes Allegany County and Mineral County, WV.  Hagerstown-Martinsburg MSA includes Washington County and Berkeley and Morgan counties, WV.  Salisbury MSA includes Somerset and Wicomico counties.

Maryland unemployment rate falls again in December

Maryland’s monthly unemployment rate fell again last month, to 6.7 percent, according to data released today from the Bureau of Labor Statistics.  This is the lowest the rate has been since February of 2009.

The state added 8,100 jobs in December.  Unfortunately, there are still 125,000 fewer employed Marylanders than there were four years ago.

Given the continuing weak economy, Governor O’Malley is right to emphasize jobs in recent weeks.  Whether it is leveling the playing field for local employers by implementing an online sales tax, hiring new state workers in critical areas, funding infrastructure projects and school and rental housing construction through the capital budget, or asking the wealthiest Marylanders to help pay for services to help their less fortunate neighbors, finding the revenues to pay for vital services is responsible governing.

On the other hand, Maryland can ill afford more job-killing budget cuts to schools, healthcare providers, childcare centers, and other vital services that provide employment, help families get back on their feet, and keep Maryland competitive.  As the General Assembly takes up the budget, we call on them to build on the Governor’s proposal and pass a budget that helps low and moderate income Marylanders continue to recover from the effects of the Great Recession.

Maryland subsidy programs score B- in national study

Maryland is fourth in the nation when it comes to enforcement mechanisms for economic development projects that fail to meet their performance objectives, according to a report out today from Good Jobs First (GJF).  However, there is still work to be done as Maryland only achieved a B- grade.  This new report comes a month after GJF ranked Maryland fifth in terms of subsidy performance and job quality standards.

Subsidy enforcement mechanisms are a timely topic in Maryland, as several programs have been in the news recently.  Officials with the Department of Business and Economic Development (DBED) testified yesterday in front of the Senate Budget and Taxation Committee about two programs, InvestMaryland, and the Job Creation Tax Credit, which are intended to spur innovation and job growth.  On Monday, Lieutenant Governor Brown highlighted a proposal that will be in Governor O’Malley’s budget released later today; Health Enterprise Zones (HEZ’s).  Similar to Maryland Enterprise Zones, HEZ’s would provide financial incentives to doctors and clinics that set up shop in areas with poor health outcomes (usually poor rural or urban areas).  The House Ways and Means Committee may also revisit the Tax Credit Evaluation Act, which would require tax credits to undergo a cost-benefit review every five years.  The bill died in the Senate last year.

Narrowing the health outcome gap is a laudable goal, as are job creation and spurring innovation.  However, as the GJF reports highlight, accountability standards and enforcement mechanisms are key to the success of any subsidy program.  DBED is rolling out a database that is a step in the right direction, and passing the Tax Credit Evaluation Act would be another.  Maryland should continue to improve its subsidy programs, to the benefit of all Marylanders