Pit and the Pendulum: Economic Trends in Maryland #MACoCon

Anirban Basu, Chairman and Chief Executive Officer of the Sage Policy Group presented during the MACo Summer Conference focusing on the performance of the global, national, and regional economy; and offering insight into key aspects of economic life in Maryland. This general session titled “The Pit and the Pendulum: Economic Trends in Maryland” was moderated by Cecil County Executive Tari Moore.

Anirban Basu Presents at the Summer MACo Conference
Anirban Basu Presents at the Summer MACo Conference

Mr. Basu commented that the economic recovery has largely focused on stock prices; not income, jobs, and housing. This indicates the recovery is affecting a smaller group, not the population broadly, which may leave some feeling like the economy is not recovering.  When you examine the employment cost index, there has not been much wage growth at all.

In terms of employment, Maryland’s largest growth sectors have been leisure and hospitality, and education and health services.Growth employment sectors remain the same in the Baltimore region, but the largest growth sector in the Washington region is professional and business services. While Maryland’s unemployment rate is in the middle of the pack, the rate greatly varies across local jurisdictions. Howard County has the lowest unemployment rate at 4.5% and Baltimore City has the highest rate at 8.2%.  Areas with higher unemployment rates tend to be clustered in Western Maryland and the Eastern Shore. The unemployment rate tends to be lowest in the areas with federal jobs.

Mr. Basu also provided information on population trends and when combined with unemployment figures, stated that you can make an argument that there is a need to invest in counties that have underperformed and have lost population, like those in Western Maryland and the Eastern Shore. He then referenced Governor Hogan’s recent investment in roads and bridges and FY 2016 Community Development Block Grant Awards.

In closing, Mr. Basu offered economic predictions. He said that the economy is going to continue to grow, but not that rapidly, and the stock market will remain strong. The Maryland economy has improved adding jobs in the aggregate, but it will continue to underperform, with state government cutbacks making their mark, too. He stated, “We need to create an economy that keeps the best brightest here.”