Maryland employers added a slim 900 jobs in January as the drag of a faltering economy took hold, the federal government said yesterday.

In another sign of slowing growth, the Labor Department also significantly lowered its count of jobs created in the state last year - 20,600 rather than the nearly 30,000 that preliminary statistics showed. Employers added more than 30,000 jobs in each of the previous three years.

Andy Bauer, regional economist for the Federal Reserve Bank of Richmond's Baltimore office, wasn't surprised to hear about the less rosy picture of 2007.

"It would be consistent with what we're seeing nationally," he said. "We're entering a softer period here in Maryland as well."

The unemployment rate still managed a small improvement in January. The share of jobless workers dropped to 3.5 percent, from 3.6 percent the month before. That figure, like the month-over-month job change, is adjusted for seasonal variations.

Local unemployment remains well below the nation's 4.9 percent jobless rate in January. But growth in the labor force - the number of Marylanders working or actively looking for work - has been anemic for a year. That suggests to Bauer that some workers have dropped out of the labor pool, particularly in fields that have been hard-hit by the housing downturn.

The local and national economic weakness that began with the sharp slowdown in home sales can now be seen in a variety of industries across the state.

In the 12 months ending in January, employers in the financial activities sector cut 3,000 jobs. Construction, which includes homebuilding, cut 700 jobs. Trade, transportation and utilities was also down by 700 jobs.

Professional and business services, a mainstay sector for Maryland, added 4,800 jobs from January 2007 to January 2008. But during the stronger economic years of 2004 through 2006, average annual gains in that sector ranged from 6,700 jobs to 10,000 jobs.

Manufacturing continued to shed jobs as usual - 2,000 over those 12 months.

The biggest gainer was education and health services, up 10,300 jobs. Government, which added 6,600 jobs, accounted for almost a third of the employment growth from January 2007 to January 2008.

jamie.smith.hopkins@baltsun.com