The Mottled Landscape of Unemployment

A dataset shows 51% of counties with unemployment rates below the national average in 2017, while individual rates portray the varied experience of labor successes.

The National Association of Counties County Explorer released a analysis of Bureau of Labor Statistics, Local Area Unemployment Statistics from 2017. They found that on average, county unemployment rates were below the national unemployment rate.

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2017 labor statistics showing varying rates of unemployment across America’s counties.

Much reporting on the recovery from the Recession has described how pockets of the country have recovered more quickly than others – a picture often hidden by national statistics. County-level data helps to reveal economic realities that relate more closely to the experiences of many Americans.

The national average unemployment for 2017 was 4.4%.

For Maryland, the picture is varied.

  • Lower 2017 Unemployment Than the National Average (1.6% – 4.0%)
    • Howard, Anne Arundel, Talbot, Calvert, Queen Anne’s, St. Mary’s, Charles, Montgomery, Frederick, Carroll, Harford.
  • 2017 Unemployment Near the National Average (4.0% – 4.7%)
    • Washington, Baltimore County, Kent, Caroline, Prince George’s.
  • Greater 2017 Unemployment Than the National Average (4.7%-19.1%)
    • Garrett, Wicomico, Cecil, Allegany, Baltimore City, Dorchester, Worcester and Somerset counties.

Allegany, Baltimore City, Dorchester, Worcester and Somerset counties had the highest unemployment levels in the State in 2017, 5.7% or higher, according to the data.

The statistics use the following definitions (abridged):
  • Unemployment Rate: Number of persons unemployed as a percent of the labor force.
  • Population: All persons in the civilian noninstitutional population ages 16 and older classified as either employed or unemployed.
  • Number Employed: Each employed person is counted only once, even if he or she holds more than one job. Someone is considered employed if they:
    • did any work as paid employees, worked in their own business or profession or on their own farm, or
    • had jobs from which they were temporarily absent, whether or not they were paid for the time off or were seeking other jobs.
  • Number Unemployed: Included are all persons who had no employment, and had made specific efforts to find employment.

For more information, visit NACo’s County Explorer.

County Retirement Executive Shortlisted for National Innovation Award

Montgomery County’s Retirement Executive Director Linda Herman is recognized as one of the brightest and most forward-looking asset owners in the US.

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Linda Herman is selected by her peers for national recognition.

Linda Herman, Executive Director of Montgomery County Employee Retirement Plans was nominated for an innovation award from the online publication CIO, in the category of Public Defined Benefit Plan Below $15 Billion.

From Chief Investment Officer (CIO),

For the ninth consecutive year, CIO is announcing its short list of the most innovative asset owners and asset managers. Nominated by a network of their peers who represent more than $1.8 trillion in assets under management, the brightest and most forward-looking asset owners have made it onto our 2018 short list for CIO’s Innovation Awards.

Ms. Herman was appointed Executive Director in Montgomery County in April 2004. From 1999 to her appointment as Executive Director, Ms. Herman served as Senior Investment Officer for the Board.

Herman also currently represents Maryland Counties on the Maryland State Pension  Board of Trustees where she serves on the Investment Committee. She is the first person to serve as the county representative to the State Pension Board, a seat created by the General Assembly in 2013.

For more information, see CIO Announces Innovation Awards Finalists for Dec. 13 Gala.

 

NAFTA 2.0?

After nearly a year of high-level negotiations, the United States and Mexico announced a preliminary agreement on a major overhaul of the North American Free Trade Agreement (NAFTA), a trilateral accord negotiated by the governments of the United States, Canada, and Mexico. Meanwhile, Canadian officials are in Washington to try and salvage the 24-year-old accord that accounts for more than $1 billion in annual trade.

NAFTA’s terms, which were implemented gradually through January 2008, sough to remove barriers to trade and investment between the three countries.

Manufacturing

The new deal would require auto manufacturers to produce at least 75% of a car’s value in North America, up from the NAFTA threshold of 62.5%, to qualify for NAFTA’s zero tariffs. Automakers would also be required to buy more steel, aluminum, and auto parts locally, and ensure workers in Canada and the US have higher wages.

These proposals are designed to reverse years of outsourcing and improve wages in both the United States and Mexico.

Agriculture

The new deal will keep tariffs on agricultural products traded between the United States and Mexico at zero and set new standards for agriculture and calls for innovations in biotechnology. It requires Mexico to raise environmental standards to be more in line with standards in the United States.

In an effort to drive Mexican wages higher, the agreement also contains enforceable labor provisions that require Mexico to adhere to more stringent labor rights and standards.

Sunset 

The United States had insisted that the new agreement contain a “sunset” clause that would cancel the agreement unless it was renewed every five years, but backed off the demand after businesses complained that it would disincentivize long-term investment in the region.

Instead, the United States and Mexico agreed to a 16-year lifespan for NAFTA, with a review every six years. That longer time horizon would give lawmakers a chance to assess the pact’s progress, while providing businesses with more economic certainty.

The Path Ahead

The White House plans to notify Congress on Friday of its intention to enter into a new trade agreement, to provide the required 90 days’ notice that would allow NAFTA 2.0 to be signed by December 1, when Mexico will install a new president.

According to Bloomberg:

President Donald Trump said talks with Canada to overhaul the North American Free Trade Agreement are going well, expressing optimism the two countries could reach a deal this week.

“We’re doing really well,” Trump told reporters at the White House on Wednesday, referring to negotiations between U.S. and Canadian officials in Washington. “They want to be part of the deal. And we gave till Friday and I think we’re probably on track.”

Earlier, Canadian Prime Minister Justin Trudeau said his government is trying to reach agreement with the U.S. this week. But Trudeau added that Canada won’t sacrifice its goal of getting the “right deal.”

Useful Links

Read the full article from Bloomberg

White House Statement on NAFTA Renegotiation

More Like, ‘Move the Box’ – Discussing Criminal Histories and Job Applications

Panelists at MACo’s Summer Conference share how criminal histories continue to be a part of job applications, even when ‘ban-the-box’ laws are in place.

At MACo’s Summer Conference, panelists including Hadi Sedigh of the National Association of Counties, Caryn York of the Job Opportunities Task Force, and Jacia Smith of Baltimore City’s Department of Human Resources joined a conversation moderated by Maryland Delegate Nick Mosby about ban-the-box legislation and its effect on county hiring practices.

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Caryn York of the Job Opportunities Task Force and Maryland Delegate Nick Mosby respond to questions following a panel discussion on ban-the-box legislation led by Delegate Mosby.

Ban-the-box legislation has been passed in several Maryland jurisdictions, including Baltimore City, and advocates continue to push for statewide changes to criminal records reporting requirements for employment and other applications, including college applications, housing applications, and social services forms.

The panelists and Delegate Mosby described the positive potential for ban-the-box policies, including improved reentry, reduced recidivism, and a stronger tax base.

As far as the effect of the laws on county human resources departments, however, implementation has not presented as many issues as may have been anticipated. Strict rules for consideration may still be applied to certain positions, including public safety posts with additional security requirements, and for other positions, criminal histories may still be considered and be a deciding factor – they are just not revealed at the outset of the application process.

“It’s more like move the box than ban the box,” Caryn York, Executive Director, Job Opportunities Task Force

More information about the Job Opportunities Task Force

More information about national ban-the-box advocacy

More information about 2018 ban-the-box legislation in the General Assembly

 

Howard County Announces Trade Apprenticeship Program

Howard County Executive Allan H. Kittleman today announced plans for an apprenticeship program, starting in 2019, to fill electrical, plumbing and HVAC-R jobs in Howard County. Howard County is among a handful of jurisdictions that recently earned approval from the Maryland Department of Labor, Licensing and Regulation (DLLR) to use registered apprenticeships to attract skilled workers in needed employment areas.

According to a press release:

“Howard County, among other jurisdictions, is losing some of its best tradespeople in the workforce to attrition and retirement,” said Kittleman.  “Before those skills and expertise are gone, we hope to help transfer those abilities to a new generation of electricians, plumbers and HVAC-R technicians. These are solid career paths that will always be needed in the government sector.”

DLLR Secretary Kelly M. Schulz shared that, “Maryland’s local governments are discovering what many of our businesses have known for decades. Registered apprenticeship is a great way to build your workforce, whether you are in the private or public sector.”

The three apprenticeships being developed in Howard County for July of 2019 are full-time, paid positions with benefits. Candidates in the 4-year program also will attend trade school for free with 144 classroom hours per year, as well as complete 2,000 on-the-job training hours, in exchange for a commitment to remain employed with the county for at least two years after the program.

“It is increasingly difficult to compete with the private sector for skilled tradespeople and the technology and energy-efficiency standards are constantly evolving and improving,” said Jim Irvin, Director of the Department of Public Works. “We are looking to develop our own talent to help us keep county facilities operating safely and effectively for our residents, visitors and co-workers.”

Apprentices will mainly work for the Bureaus of Facilities, Utilities and Environmental Services within the Department of Public Works to maintain more than 2.5 million square feet of county government facilities among 172 buildings. Assignments will span residential maintenance at county-owned properties, commercial operations at county office buildings and industrial settings like wastewater treatment facilities and the landfill. The candidates will be overseen and trained by master tradespeople associated with AFSCME 3085, the local Howard County trade union for public employees of the Department of Public Works.

The positions are included in the Fiscal Year 2019 budget and are expected to be filled in July of 2019.  Details of the policies and procedures for the program are expected to be finalized prior to the end of 2018.

Read the full press release for more information.

Maryland Bests Goal, Bucks Trend with Pensions Performance

The State Pension System’s fiscal year 2018 returns were higher than the assumed rate of return, and its overall funding ratio continues to improve. 

The Maryland State Pension System has beat its goal for investment returns, earning 8.06% against a 7.50% target, according to a press release from the State Pension System. The System also continues to shrink its unfunded liability, counter to a national trend in the opposite direction.

The Maryland Reporter puts this year’s investment returns in context of the System’s historical gains and the size of its remaining funding gap, stating that in the long-term, Maryland still falls below its investment target and that the System is underfunded by $19 billion.

According to the Maryland State Retirement Agency, the System has earned an average of 8.07% since 1986. And, while the System is not yet fully-funded, positive returns like this year’s help reduce its unfunded liability.

Through a combination of investment performance improvements, and benefit reforms made over several years, the System’s health is improving. From the State Pension System Press Release:

“Investment returns this past year are consistent with the long term expectations for our diversified asset allocation and the Board is pleased that, as a result of its oversight and the diligent work of the System’s Investment Division, this asset growth helps to ensure the sustainability of our Plan.” – State Treasurer Nancy K. Kopp, Chair of the Maryland State Retirement and Pension System Board of Trustees.

About half of Maryland counties participate in the State pension system to provide pensions to county government employees. As members of the System, those counties have a particular interest in the System’s investment returns.

In Maryland, the General Assembly has also acted to reduce the Pension System’s unfunded liability through benefit reforms. Reforms enacted by the Legislature in 2011 continue to show positive results:

  • Contribution rates are lower for the coming fiscal year (17.42%) than had been projected (18.70%) in the June 30, 2010 valuation, and the Maryland Pension System’s funded ratio (71.8%) is higher than had been projected (64.5%) at that time
  • The System is on track to be:
    • 80% funded by 2026, and
    • 100% funded by 2039

This positive progress is the inverse of an identified national trend in pensions, as the funding ratios of many public pensions have recently declined. Maryland has made progress surmounting the hurdles experienced by public pensions across the country, including a growing number of retirees, and reduced anticipated investment returns. The increase in Maryland’s Pension funding level is largely due to benefit reforms enacted by the General Assembly, including more restrictive criteria for cost-of-living increases.

The ability of county governments and many municipalities to participate in the State Pension System allows them to provide a certain level of benefit to their employees that might not be otherwise sustainable. MACo will continue to track the System’s progress toward its goal of 100% funded status on behalf of county stakeholders.

The Chair of the Maryland State Retirement and Pension System Board of Trustees, Treasurer Nancy Kopp, will be speaking at this year’s MACo Conference. The Treasurer will be a special guest at the Women of MACo Lunch, on Friday, August 17, 2018.

Learn more about MACo’s Summer Conference:

 

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Washington & Frederick County Youth Apprenticeship Program Gets Boost

The Maryland Department of Labor, Licensing and Regulation announced that the FirstEnergy Foundation has once again offered $15,000 to Washington and Frederick County businesses to support the hiring of youth apprentices through the successful Apprenticeship Maryland Program (AMP).

According to a press release:

“We knew that youth apprenticeship would help businesses build a pipeline of talented, energetic employees,” said Maryland Labor Secretary Kelly Schulz. “What we didn’t know is the profoundly positive impact that youth apprenticeship would have on students, employers, and their communities. The FirstEnergy Foundation understands the value in the apprenticeship program and has, through their partnership, given us the ability to create opportunities and life-changing experiences for our youth.”

FirstEnergy Foundation’s donation brings their total contribution to the program to $45,000. Since 2016, five Washington County companies have utilized $22,500 in grant funds. The businesses use the funds to offset costs related to hiring and training the youth apprentice.

The AMP, founded in 2015 as a pilot in Frederick and Washington counties, is a partnership between the Maryland Department of Labor, the Maryland State Department of Education, the Department of Commerce, the county public school system, community educational and business partners, and area employers. Youth apprenticeship is open to all industries, with a priority on high-growth career tracks such as science, technology, engineering, math (STEM), and manufacturing.

Learn more about the Apprenticeship Maryland Program or contact Targeted Populations Grant Program Manager Jeffrey Smith from the Maryland Department of Labor at 410-767-2246.

The [Kirwan] Commission on Innovation and Excellence in Education is considering recommendations to expand apprenticeship programs and other opportunities to participate in a career while in high school.

MACo’s Summer Conference will include a session on education funding and accountability, and how to best ensure that Maryland students receive a fair, equitable, and high-quality education. The session, “Angling for Educational Excellence: Kirwan 2.0,” is scheduled for 10:15 am – 11:15 am on Saturday, August 18, 2018.

The 2018 MACo Summer Conference will be held August 15-18 at the Roland Powell Convention Center in Ocean City, Maryland. This year’s theme is “Water, Water Everywhere.”

Learn more about MACo’s Summer Conference:

Carroll Concerned Over School Bus Driver Shortage

Carroll County has a shortage of school bus drivers going into the new school year – and the blame is placed on the new sick leave law.

Mike Hardesty, director of transportation with Carroll County Public Schools, told the Carroll County Times that the next school year will probably suffer from a shortage of drivers, due to the Maryland Healthy Working Families Act.

The contractors who work with the school system have indicated that they need to hire additional substitute drivers to cover for any additional absenteeism.

Hardesty told the Times:

We know some of our major contractors with a large number of buses to man for the opening of school are working hard to make sure they have an adequate number of full-time and part-time drivers.

The Benefits of Stress-Testing Your Pension

The Pew Charitable Trusts have released a report recommending public pensions conduct tests to anticipate their viability during market downturns on a regular basis. 

The Pew Charitable Trusts analyzed 10 state pension systems (Maryland’s pension system was not one of the systems studied) and developed a set of broadly applicable recommendations for public pensions systems and their ability to survive economic volatility.

About half of Maryland’s counties participate in the State’s pension system, and all counties make payments toward the State’s teacher pension system as part of their support for the State’s local school boards.

The Pew Charitable Trusts study outlines warning signs for public pensions, and recommends certain funding structures, based on examples, to help improve public pension resiliency.

From Pew:

Uncertainty over long-term economic growth and the fragile nature of public pension funding demand policy solutions that manage volatility and lower state costs. The problem is only going to worsen as more members of the baby boom generation retire and pension money is paid out of state treasuries faster than it is coming in. Stress testing gives policymakers a clearer sense of how future economic downturns could affect pension finances, critical insight when setting policies that protect taxpayers and retirees.

For more information, see Stress Testing Can Help Troubled State Public Pension Funds, a study from The Pew Charitable Trusts and Why Our Public Pensions Need Stress Tests from Governing.

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Baltimore Council’s Over Police Going Over on Overtime

In a move that will only make financial purists crazed, the Baltimore City Council has voted to reject a budget transfer for $21 million to cover police overtime from the previous fiscal year – money that, of course, has already been spent.

The Baltimore Sun quotes Public Safety Committee Chair Brandon Scott:

This is a clear message that the status quo is not going to work anymore.

Last year the Baltimore Police Department spent $47.2 million on overtime. According to the Sun, $16 million was budgeted. From the coverage:

The committee vote comes as leaders on the City Council have announced monthly accountability meetings about the police department, focusing on both the agency’s budget and its crime-fighting strategies.

The city law department also is auditing the Police Department’s overtime, but has yet to make the results of the audit public.

Read the article here.

See the Baltimore Police FY18 budget information here.