Economy hums, but nervousness remains Recession fears prompt skittishness, quarterly report says


Howard County's economy continues to hum along with strong growth in employment, home sales and tax receipts, but nervousness remains from the long recession of the early 1990s, according to the June issue of "Economic Indicators."

The quarterly report is a mix of data, analysis and hunches from the Howard County Economic Forum -- a private group -- and county budget, development and finance officials.

The June issue, released this week, is the most optimistic since the first issue of "Economic Indicators" in 1994. But still it warns, "The memories of the early '90s continue to be in the minds of all."

"I'm personally a little worried about the next three months," said Lee Wilhide, president of Wilhide's Flowers and one of the report's authors. "People are just not as happy as things would seem to indicate."

That is despite strong corporate earnings for his company and upbeat reports from almost every sector of the local economy. "This is just a gut feel," Wilhide said.

Richard Story, executive director of Howard's Economic Development Authority, said some consumers of such durable goods as cars and homes remain skittish from the recession and the federal government shutdown more than a year ago.

Ed McKee, vice president of Commercial & Farmers Bank in Ellicott City, described the mood as "cautious optimism" -- an improvement from several years ago, he said, when "it used to be optimistic pessimism." But for now, "Economic Indicators" portrays a strong economy in Howard County.

In March, the employment of county residents was up 4 percent from last year. Unemployment among residents fell from 2.9 percent to 2.7 percent in the same period.

The number of building permits for new single-family homes jumped to 1,163, up 47 percent, for the nine months ending in March, compared with the same period for the previous year.

Real estate agents report that the market for expensive homes remains weak, but more-affordable homes are selling well, thanks in part to demand from first-time home buyers.

Demand for loans remains strong, particularly among businesses looking to expand or diversify in the strong local economy.

Farmers are optimistic and plan to buy new equipment in the coming months despite some weather-related damage to wheat and alfalfa crops. Business has been good for nurseries, landscapers and fruit and vegetable growers.

There is good news in county revenue as well.

Transfer tax receipts, which had been stagnant for the past several years, are up 10 percent in the 10 months ending in April, compared with the same period the previous year.

More important, income tax receipts continue to grow, by 10.2 percent in the third quarter of 1996 and 7.7 percent in the first quarter of 1997. Income tax receipts have grown between 6 percent and 7 percent the past four fiscal years.

But all the good news is not enough to convince Howard's business community that good times are here to stay.

"We're doing fairly well," said Guy Caiazzo, an Ellicott City investor and moderator of the Economic Indicators Committee. "But let's not raise all the flags and bring out the brass band."

Pub Date: 6/19/97

Copyright © 2021, The Baltimore Sun, a Baltimore Sun Media Group publication | Place an Ad