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Howard ranks 2nd in nation in median income at $108,844

Howard County households are among the most prosperous in the nation, according to results from a recently released survey.

Income data from the American Community Survey, an annual data collection project run by the Census Bureau to supplement the once-a-decade census, shows that Howard County has the second-highest median household income in the nation.

At $108,844 in 2012, Howard County's median income was second only to Loudoun County, Va., which last year had a median income of $117,876. Trailing Howard County are Fairfax County, Va., Hunterdon County, N.J., and Arlington County, Va., in third, fourth and fifth place, respectively.

Maryland ranked first in the list of high-income states, with a median household income of $71,122, ahead of New Jersey, Alaska, Connecticut and the District of Columbia.  

Six of the counties in the top 25 are in Maryland, five are in Virginia, four are in New Jersey and three are in New York.

Other Maryland counties in the top 25 are Montgomery (11); Charles (15); Anne Arundel (18); Calvert (19) and St. Mary’s (21).

Economists attributed Howard's prosperity to a variety of factors, including its suburban nature, proximity to federal jobs in Washington, D.C. and strong educational system.

Anirban Basu, an economist at the Baltimore-based Sage Policy Group, called Howard County's ranking "impressive."

"For Howard County to rank second in the country [in median household income] tells us a lot about Howard County and its broadly shared prosperity," he said.

Basu laid out five factors that he thought played the greatest role in Howard County's economic stability:

· Suburban character: "One of the reasons that suburban counties often have higher median household income relative to cities is that cities tend to have at least some degree of concentration of poverty and there's relatively less of that in suburbs."

· Nature of the housing stock: "If one observes the housing stock in Clarksville, Ellicott City or elsewhere, a lot of the housing is single-family residential. And homeowners, on average, tend to have higher incomes than renters."

· Large workforce of federal employees: "Federal workers tend to be highly educated and their compensation reflects, at least in part, their education. Howard County is also the community of choice for people who work for government contractors, including those located in neighboring jurisdictions in Montgomery and Anne Arundel counties."

· Renowned public school system: "Howard County has the reputation of having the finest public schools in Maryland, and Maryland has the reputation of having the finest public schools in America. This status attracts the types of people who are affluent enough that they can choose what kind of community they live in, and they disproportionately select Howard County because it gives them an opportunity to provide their children with the best public education possible."

· Concentration of successful technology companies: "Howard County has established itself as a technological hub… Sometimes these businesses aren't always as obvious as one might expect because they're not the Microsofts, Facebooks or Twitters of the world. In their locations, those businesses are often unnoticeable, [but they're there]."

Taken together, these factors are "working in the same direction and all positioning Howard County to be among the most prosperous in the nation," Basu said.

In 2011, Howard County ranked fifth in median household income among counties nationwide, at $98,953, which would seem to suggest its fortunes took a leap last year.

But Mark Goldstein, an economist for the Maryland Department of Planning, cautioned against reading too much into the rankings of counties within a few places of each other.

Because the American Community Survey is a much smaller survey than the Census, which attempts to collect data on every American citizen, there is a much higher margin of statistical error.

In the case of the 2011 rankings, Howard County actually tied for third with four other counties when margin of error was taken into account. In 2012, it was statistically tied with Fairfax and Hunterdon counties, although Loudoun County still held enough distance to claim first place all for itself.

The margin of error for 2012 median household income in Howard County was plus or minus $2,972.

"Howard County is a relatively wealthy county. But these numbers tend to jump up and down anyway because of the nature of the source, which is a sample," Goldstein said.

Howard County's median household income suffered in the recession, he said.

But Goldstein noted that Howard County weathered the storm much better than its fellow counties. Out of all the counties in Maryland, Howard had the second smallest percentage decline from its peak median income from before the recession to 2012, with a decline of 3.3 percent.

Only Anne Arundel, which saw a 1.1 percent decline in median household income between its peak and 2012, fared better.

Howard County also has a relatively even distribution of wealth, based on an income-equality measure called the Gini index.

"It's a high-income, low-poverty county," Goldstein said. "It's sort of self-selecting – you only move to Howard County if you can afford to live there," he said.

But Basu pointed out that Howard County has a culture of inclusiveness, which led planners to build apartment and townhouse communities for young and lower-income families and individuals. The county's Moderate Income Housing Unit program requires a percentage (usually 10 to 15 percent) of units in the county's new developments to be affordable for moderate-income households.

"From the perspective of raw numbers, Howard County could have embraced a structure such that it could have had a higher median housing income than Loudoun County [by focusing on single-family housing developments]," he said.

To keep income numbers robust, he said the county needed "to find ways to diversify its economy," citing business incubators as a possible solution for attracting entrepreneurs. Howard County's Economic Development Authority has a business incubator at the Maryland Center for Entrepreneurship.

And, he said, the next county executive would definitely play a role in the county's economic future.

"Ken Ulman has been pretty pro-business," he said of the current executive. "I think he's done a wonderful job shepherding the county's budget through very hard times."

Copyright © 2014, The Baltimore Sun
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