Maryland added 700 jobs in August
Unemployment rate holds steady at 4.3 percent; outlook still optimistic
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.”