Maryland gained 14,000 jobs in Oct.; unemployment fell

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Maryland employers turned in a third consecutive month of job growth with a large gain of 14,000 positions in October, the federal government said Tuesday — a much better trend after five months of losses.

The state's unemployment rate improved to 6.7 percent in October as a result of the expansion, down from 6.9 percent in September and 7.1 percent in August, the U.S. Department of Labor said.


James Bohnaker, an associate economist with Moody's Analytics, called the October jobs performance "a huge gain," one that comes on the heels of an also substantial 9,500-job increase in September. He expects a more normal level of growth — less than 5,000 jobs a month — for the rest of the year.

"In the middle of the year … we saw month after month of job losses, and it looked like the economy was doing really poorly," Bohnaker added. "So it's encouraging to see it trend up."


Gains were broad-based in October, with only government and manufacturing shedding jobs. Some of the gains came in the form of short-term holiday jobs at retailers, but most of the growth was in other sectors, such as professional and business services — an industry that ranges from research and development to public relations.

The job estimates, adjusted to try to account for seasonal patterns in hiring and layoffs, are preliminary and could be revised later.

For Maryland, 2012 has been a year of wild swings — big gains at the start giving way to losses, then back to big gains. It's been such a roller-coaster ride that economists have suggested the extremes might have been overstated by statistical anomalies.

All told, the state had about 33,000 more jobs in October than it did a year earlier, the Labor Department estimated.

At that pace, Maryland is about eight months shy of recovering the number of jobs it had before losing more than 100,000 positions to the recession. But that doesn't account for the jobs needed simply to keep up with population growth — and that bigger picture is more sobering.

As of September, Maryland was 202,000 jobs shy of regaining its pre-recession level of employed residents, when two-thirds of the population had jobs, according to calculations from the Brookings Institution's Hamilton Project. Even with October's growth, the state is about five and a half years away from closing that gap at the current annual pace.

It's not an unusual problem. The Hamilton Project said the nation too is years away from closing its 11 million-job gap, even if job creation accelerated to the pace set in the best year of the higher-growth 1990s.

"It was a very severe recession, and the path back is pretty challenging," said Adam Looney, the Hamilton Project's policy director.


There don't seem to be ideas for hitting the accelerator that are both inexpensive and "politically easy," he said. But he thinks there's a clearer direction for avoiding more job losses: Find an alternative to the so-called fiscal cliff facing the country in January, when across-the-board reductions to the federal budget will begin as tax breaks end.

The budget reductions — known as sequestration — could have particularly severe implications in Maryland, with its large share of federal employees and contractors.

A Moody's Analytics forecast of nearly 30,000 additional jobs in the state next year assumes the planned budget cuts are halved, with more thought given to what should be reduced. Bohnaker, the economist, doesn't expect much growth in the beginning of 2013, but "the second half of the year should probably pick up."

In October, Maryland's expanding sectors included retail, which added 3,300 jobs. Because the gain is seasonally adjusted, it suggests more hiring than usual for this time of year — some holiday workers start in October and some in November.

The expansion speaks to retailers' expectations for sales.

"If they're gearing up, then they anticipate an increase," said Patrick Donoho, president of the Maryland Retailers Association.


The biggest gain in October — 3,900 jobs — came in the professional and business services sector. Close behind was leisure and hospitality, adding 3,700 jobs.

Other substantial increases measured by the Labor Department: 2,700 jobs in the education and health services sector, 2,300 jobs in construction and 1,700 jobs in financial activities.

On the flip side: Government cut 2,700 jobs, and the long-shrinking manufacturing industry cut 2,400 jobs.

Jim Pettit, communications and policy director for Change Maryland, a conservative-leaning group, expressed concern over the manufacturing losses. Still, he said, the overall growth in October was "a good start to dig out of a deep hole that Maryland has been in for some time."

Planit, an advertising, marketing and public relations firm in Baltimore, is part of the growth trend. The company had to make deep cutbacks in staffing during the recession, but it has added 24 people this year as companies have become more willing to spend money on marketing again.

Now the company has 59 employees, about its pre-recession level. Matt Doud, Planit's president and co-founder, expects to hire even more people next year — perhaps 30 — because the trends look good. And he thinks that's a positive sign for the broader economy.


"I see our business as one of those early indicators," Doud said.