Maryland adds 11,500 jobs in February

Hiring soared in Maryland last month, as employers added 11,500 jobs, powering the strongest three-month surge of job creation the state has seen since the Great Recession.

The gains, reported Friday by the U.S. Labor Department, pulled more than 14,000 people into the labor force, as people started working or looking for work. Despite that jump, the unemployment rate held steady at 4.2 percent, below the national average, as most people found jobs.

Since February 2016, Maryland firms have added about 57,800 jobs, swelling payrolls 2.1 percent. That's the fastest year-over-year growth since 2011.

The Labor Department also revised its figures for January to a gain of 13,200, nearly double the previous estimate.

Economist Gary Keith, who follows the region for M&T Bank, called it a "blowout report."

"It's remarkably strong," he said.

Gov. Larry Hogan, in a statement, called the hiring "astounding."

Maryland's gains came as employers across the United States added 235,000 jobs in February. The national unemployment rate ticked down to 4.7 percent.

Economists said fundamentals such as robust consumer spending and business investment are driving the expansion and shaking Maryland's labor market out of its somewhat listless recovery, which had been held back in part by tighter federal spending.

"The picture is the labor market, both nationally and in our region continues to do very well," said R. Andrew Bauer, a Baltimore-based senior regional economist at the Federal Reserve Bank of Richmond.

Employers in education and health services led the hiring in February, adding 6,300 jobs over the month. Payrolls at professional and business services firms — a grab bag category that includes everything from government contractors to temporary workers — increased by 5,900. The public sector also added 2,100 positions. Employment in construction increased by 900.

Match Marketing Group, a Canadian firm that works with consumer brands on retail strategies, has brought on more than a dozen people locally in recent months, said Steve Krajewski, chief operating officer in the Baltimore area.

The firm, which has doubled its local headcount in the last three years to about 120 employees in corporate office and logistics positions, recently moved into a new building in Hanover to accommodate the expansion, which has been lifted by the growth of its clients, such as Maybelline.

Krajewski said many of the hires have come in mid-level roles — a good sign for a region where many of the new jobs in recent years have fallen at the extremes of the payscale.

"That's how the economy is going to get rolling again," he said. "For me as a business person, it's exciting to see those wheels are moving."

Economists tempered their outlook, saying the early months of the year are often volatile and it's not clear whether the recent growth will be sustainable — or survive the regular revisions the Labor Department makes to its estimates as it receives more information.

Especially in Maryland, where the economy is firmly tied to federal spending and hiring, proposals advanced by the Trump administration to shrink the size of the government and shift spending could wreak havoc, though those affects may not show up for months.

"If we had these numbers and we had no federal budget cuts looming, everybody'd be popping champagne," said economist Richard Clinch, director of the University of Baltimore's Jacob France Institute. "I'm going to be a little bit more pessimistic, because I think this is good news before the storm."

Some sectors reported declines in February. Employment at leisure and hospitality firms shrank by 2,600, while payrolls in the trade transportation and utilities industries decreased by 2,400.

Manufacturing also has had a bumpy ride. Firms added 500 jobs over the month, but employment in the sector is lower than it was a year ago.

FiberPlex Technologies, an Annapolis Junction firm that makes equipment for fiber optic cables, often selling to firms with defense contracts, was lucky to survive rising healthcare costs and sequestration, CEO Buddy Oliver said.

He's not quite ready to start hiring new workers for his roughly 17-person operation, despite encouraging signs that defense spending will offer more opportunities.

"If we could get a defense budget, even if it's just the defense appropriation bill ... that might be a big enough catalyst to where we can start hiring again," he said. But "we need to continue to ride this and see how it goes."

Optimism is clearly up, said Taylor J. Fields, vice president of leasing at Knott Realty Group. The firm has seen strong leasing at a 58,000-square-foot building it constructed recently near the Centers for Medicare and Medicaid Services complex in Woodlawn and is now nearly 70 percent leased, largely with people doing work — or anticipating it — with the federal government, he said.

"Two years ago was pretty dead. Tenants were still struggling, coming out of the recession," he said. "In the last year or so, people seem to have a lot more confidence."

The tighter labor market is even starting to affect wages. Private sector workers earned an average of $27.80 an hour in February, 60 cents more than a year earlier, according to the estimates, which unlike the other figures were not adjusted for seasonal variation.

"There's no doubt that you're seeing the hiring market get tighter," Match Marketing's Krajewski said. "If you want somebody that's a pretty sharp individual, you're going to have to pay for that talent today."

nsherman@baltsun.com

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