Maryland sees biggest job loss in nation in April

Maryland shed 6,000 jobs in April, the federal government said Friday — the largest monthly loss in the country during a month when most states gained, but one that might have been overstated.

The figures, which are preliminary and adjusted for seasonal variations, paint a much less rosy picture of Maryland employment than in recent months. As it released the April numbers, the U.S. Department of Labor said Friday that it also revised downward its estimate for March, showing Maryland losing 600 jobs rather than adding 1,500.

Maryland's unemployment rate rose to 6.7 percent in April from 6.6 percent in March, partly because more Marylanders began looking for work or tried again after giving up.

But the state's employment situation might not have taken quite the U-turn that the estimates suggest, local economists said. That's because the Labor Department, to allow for monthly comparisons, adjusts job numbers up or down to account for whether the change is better or worse than usual for the time of year. And 2012 weather has been so unusual in the area that it shifted hiring trends.

Leisure, hospitality and construction employers appear to have gotten a jump on hiring to take advantage of the early warm temperatures, said Gus Faucher, a senior economist with the PNC Financial Services Group who follows the Maryland economy.

He thinks that led to an overstatement of Maryland's gains in January and February — the estimates suggest more than 9,000 jobs added in each month — and an understatement of job creation in March and April, since hiring happened earlier than expected.

"That may be more of a seasonal weather issue than an actual weakness in the Maryland economy," Faucher said. "If you look over the past few months, let's say since late 2011, job growth is looking better in Maryland, so I think that may be a truer sense of the labor market picture."

It was a mixed bag for states near Maryland, which also saw mild winters. Virginia added 2,700 jobs, Delaware added 2,100, Pennsylvania lost 600 and West Virginia lost 1,800, and the District of Columbia added 300, according to the estimates.

In all, 32 states plus Washington, D.C. gained jobs in April, the Labor Department estimated.

Richard Clinch, director of economic research at the University of Baltimore's Jacob France Institute, agrees that seasonal adjustments are "wreaking havoc" on the numbers. But the new revisions switching Maryland from gains to losses in March troubles him. When the economy is recovering, revisions tend to add, not subtract, he said.

"I'm worried that the recovery doesn't have legs," he said, pointing to more economic problems in Europe, which could ripple across the Atlantic.

Clinch said Maryland politicians' special-session decision this week to raise income taxes for the highest earners leaves him feeling pessimistic that the state — a big recipient of federal largesse — will be able to chart a smooth course through the choppy waters of looming budget cuts in Washington. Maryland has yet to deal with its own structural budget deficit, and state leaders missed an opportunity to take a harder look at spending, Clinch said.

"The Maryland economy going forward, I think, is going to be quite fragile," he said.

Republicans opposing the tax increase said it would hurt job growth and push businesses out of town. Democrats pitched it as a way to ensure that Maryland's workforce advantages — such as a top-ranked education system — would remain strong.

Kathleen T. Snyder, president of the Maryland Chamber of Commerce, said the tax increase will have a direct and possibly unintended effect on some businesses because taxes on revenue earned by limited liability companies and other common entities are paid through their owners' personal income tax returns.

"Our focus now needs to be on how do we help the private sector grow jobs," she said. "We can't be so dependent on the federal dollar."

The estimated job losses in April forced Gov. Martin O'Malley to downgrade the percentage of jobs gained back since the recession. O'Malley, a Democrat, has frequently referred to a recovery of 80 percent — until Friday, when he released a statement putting it at 74 percent.

The country as a whole, he was quick to note, has recovered less than half the jobs lost.

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