Mary­land added 700 jobs in Au­gust

Un­em­ploy­ment rate holds steady at 4.3 per­cent; out­look still op­ti­mistic

Baltimore Sun - - BUSINESS MARYLAND - By Natalie Sher­man nsh­er­man@balt­sun.com

Mary­land job growth was lack­lus­ter in Au­gust, as em­ploy­ers added just 700 po­si­tions, a min­i­mal gain that econ­o­mists at­trib­uted to elec­tion un­cer­tainty and summer pay­roll quirks.

De­spite the mod­est in­crease, the state’s un­em­ploy­ment rate held steady at 4.3 per­cent, ac­cord­ing to the fig­ures, which were re­leased Tues­day by the La­bor Depart­ment and are ad­justed for sea­sonal vari­a­tion.

Mary­land’s per­for­mance was in line with the rest of the coun­try, where pay­rolls were es­sen­tially un­changed in 43 states. Over the 12 months that ended in Au­gust, Mary­land has added about 46,800 jobs, a growth rate of about 1.8 per­cent — a hair higher than the na­tional rate.

It’s typ­i­cally more dif­fi­cult to get ac­cu­rate es­ti­mates of the la­bor mar­ket in the summer months, amid sea­sonal hir­ing and summer va­ca­tion for schools, said R. An­drew Bauer, a Bal­ti­more-based se­nior re­gional econ­o­mist at the Fed­eral Re­serve Bank of Rich­mond.

“It was one of those months where the num­bers just went in the op­po­site di­rec­tion and you see a lot of neg­a­tives,” he said. “The larger take­away is we see con­tin­ued im­prove­ment in the la­bor mar­ket.”

Bauer cited the pace of an­nual job growth, as well as the gains seen across in­dus­tries as rea­sons for op­ti­mism. Though a monthly Fed­eral Re­serve sur­vey of busi­ness firms sug­gests slug­gish ac­tiv­ity in some months this year, firms’ hir­ing ex­pec­ta­tions have held strong, Bauer said.

The gains Mary­land eked out in Au­gust came from the pub­lic sec­tor, which added 6,000 jobs, ac­cord­ing to the La­bor Depart­ment. Pay­rolls at trade, trans­porta­tion and util­i­ties firms grew by 2,200 while leisure and hos­pi­tal­ity em­ploy­ers re­ported a gain of 1,900.

Nearly every other sec­tor re­ported losses.

Em­ploy­ment de­clined by 4,900 in the pro­fes­sional and busi­ness ser­vices cat­e­gory, a wide range of firms that in­cludes fed­eral con­trac­tors, temp work­ers and le­gal ser­vices. Pay­rolls in health and ed­u­ca­tion ser­vices fell by 2,300 and by 2,700 in the con­struc­tion sec­tor.

The La­bor Depart­ment also re­vised July’s job fig­ures to show no change for the month, in­stead of the nearly 3,000-job in­crease from June it pre­vi­ously es­ti­mated.

Econ­o­mist Daraius Irani of Tow­son Univer­sity’s Re­gional Eco­nomic Stud­ies In­sti­tute said the end of the fed­eral fis­cal year in Septem­ber may mean some firms are slow­ing hir­ing as fed­eral con­tracts wind down.

Elec­tion un­cer­tainty also is likely mak­ing busi­nesses cau­tious, said Gary Keith, an econ­o­mist at M&T Bank, which this week re­leased a na­tional sur­vey of busi­nesses show­ing ris­ing lev­els of eco­nomic anx­i­ety.

Some firms have ben­e­fited from a slower hir­ing en­vi­ron­ment.

Gov. Larry Ho­gan, who is lead­ing a state trip to Is­rael, on Tues­day high­lighted Nayax, an Is­raeli firm that makes and sells ser­vices re­lated to unat­tended, cash­less pay­ment sta­tions, like vend­ing machines and elec­tric ve­hi­cle charg­ing sta­tions. The com­pany opened U.S. of­fices in Hunt Val­ley in 2014 and moved to a new location this March, said CFO and COO Carly Furman.

Furman said the slow eco­nomic growth has ac­tu­ally helped its busi­ness, since many com­pa­nies have been look­ing to save on la­bor costs and bet­ter in­ven­tory man­age­ment. It’s hired four peo­ple this year, bring­ing its staff to 15, she said.

“There’s op­por­tu­nity for us,” Furman said.

The slow eco­nomic growth also is re­flected in par­tic­i­pa­tion in the la­bor force — peo­ple work­ing or look­ing for work — which re­mains lower than be­fore the re­ces­sion.

“Even though we have a lot of prospec­tive work­ers out there in­ter­ested in land­ing jobs, we don’t see em­ploy­ers hir­ing up at a suf­fi­cient rate in or­der to re­cover,” said Nick Buffie, a re­searcher at the Cen­ter for Eco­nomic and Pol­icy Re­search, who pub­lished a pa­per re­cently fo­cused on the peo­ple who go un­counted in cal­cu­la­tions of the stan­dard un­em­ploy­ment rate be­cause they are work­ing part-time or have stopped look­ing for work. “I think if you had a stronger econ­omy, many of those peo­ple would re­turn to work.”

Sev­eral firms in the state have an­nounced sig­nif­i­cant lay­offs in re­cent weeks. The Volvo Group said Monday it would lay off more than140 work­ers at its truck man­u­fac­tur­ing plant in Hager­stown. Safe­way last month an­nounced plans to close a store in Lau­rel, af­fect­ing 75 work­ers.

Finiti Ti­tle LLC also told the state this month it would close its Columbia of­fices, af­fect­ing 100 work­ers.

“We’re right­siz­ing the com­pany,” said Alyson Austin, di­rec­tor of me­dia and pub­lic re­la­tions at CoreLogic, which par­tially owns the firm and em­ploys about 5,500 peo­ple glob­ally. “These are all just busi­ness de­ci­sions that have no bear­ing on par­tic­u­lar op­er­a­tions there in Mary­land.”

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