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Md. economic report shows few bright spots Mid-autumn figures give little sign of upturn soon

Like President Bush, who yesterday acknowledged that the nation remains in recession, Maryland officials chimed in with a gloomy portrait of the state's economy in mid-autumn.

The monthly report of economic indicators, published by Maryland's Department of Economic and Employment Development (DEED), reinforced the view that Gov. William Donald Schaefer presented to a television and radio audience last night: An end to the state's recession is not on the horizon.

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A few private industries showed employment gains in October -- most notably health care, with 500 new jobs during the month. But most areas were down: The construction sector lost 2,800 jobs in October; service industries lost 2,100; and finance, insurance and real estate companies cut 1,100 employees.

Even with job recalls in education, the unemployment rate rose from 5.2 percent in September to 5.5 percent in October, with 35,291 fewer people employed. Unemployment claims, which had declined during the summer, have been rising slowly but steadily in the last few months, up about 5,600 since the end of September to 54,737 on Nov. 30.

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DEED's Office of Research did point out that initial claims for benefits have fallen slightly in the last month. "Along with other leading economic indicators, a gradual decline in initial [unemployment insurance] claims indicates the onset of an economic recovery," the report said.

The research office also noted that mortgage interest rates in the Baltimore area have fallen in recent months.

The third-quarter average rate was 8.82 percent, down from 9.27 percent in the second quarter, a response to the continuing decline in the prime lending rate.

But the lower rates haven't spurred residential construction. In October, the number of housing units authorized statewide fell to 2,016, a 5.1 percent decline from September.

Only in Howard, Queen Anne's and Worcester counties and Baltimore City were more housing permits issued in the first 10 months of this year than last year, DEED reported.

The DEED economists expressed some hope in the fact that overall employment, as measured by a survey of households, showed a gain for the fourth straight month, even though jobs reported in a survey of employers had declined.

The implication, said economist Pradeep Ganguly, is that Marylanders are beginning to find jobs in surrounding states and commuting.

Most other indicators, however, were negative in October:

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* Retail sales fell $335 million, to $2.86 billion, a 4.5 percent decline from October 1990.

* Manufacturing wages fell 21 cents an hour, to $11.99, mostly because of a 42-cent per hour drop in durable goods manufacturing wages.

* Electricity sales, both residential and industrial, were slower.

* The Federal Reserve Bank of Richmond, Va., reported less manufacturing activity in Maryland.

On the other hand, automobile registrations increased 9.8 percent in October, and more air cargo moved through Baltimore-Washington International Airport.


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