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Unemployment rates climb in Southern Maryland

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By Erica Mitrano
Maryland Independent
Thursday, April 8, 2010

Unemployment shot up in Southern Maryland with the new year, according to data recently released by the Maryland Department of Labor, Licensing and Regulation, but the change might be at least partly the result of market changes that occur every year.

Between December and January, unemployment rates for Charles and Calvert counties rose nine-tenths of a percentage point, to 6.9 and 6.8, respectively. St. Mary's County was affected more severely, with its rate climbing from 5.7 percent to 7 percent in that period. The climb mirrors the state as a whole, where unemployment rose from 7.1 to 8.3 percent.

But labor and licensing officials say the state's health is better reflected by the seasonally adjusted unemployment rate, which crept upward in January to 7.5 percent, from December's revised rate of 7.4 percent, and rising to 7.7 percent in February, according to the department.

Maryland remains substantially below the national rate, which was 9.7 percent in January and February. County unemployment rates were unavailable for February.

Seasonal adjustment rates attempt to correct for normal annual changes in unemployment to allow comparison with different times of the year; the rates tend to rise in the summer as young people finish school and dip in November as seasonal retail jobs become available, said Anirban Basu, chairman and chief executive officer of the Sage Policy Group, a Baltimore-based economic consulting firm.

The rise in the state unemployment rate in January was expected as holiday jobs vanished, he said.

Seasonally adjusted rates cannot be calculated for individual counties, said Bernie Kohn, spokesman for the Department of Labor, Licensing and Regulation. Although the spike in the number of job seekers is not normally this pronounced, January typically sees a rise in unemployment regardless of the economy's health, he said.

Also, the state's work force expanded by half a percent between December and January, possibly reflecting discouraged job seekers regaining enough hope to try again, Kohn said.

"One thing is a little bit unusual in Southern Maryland as well as pretty much the rest of state: The labor force actually went up," Kohn said. "There are a number of things that possibly could account for that, but one of them is potentially somewhat of a sign of optimism. People out of the work force for a long time are starting to look for a job again. They think it's possible, but they haven't found anything yet."

The work force, however, expanded by fewer than 15,000 during this period, while the ranks of the unemployed swelled by more than twice that, suggesting that some 20,000 Marylanders lost their jobs.

Basu said the state is still losing jobs because hiring generally lags about nine months behind production increases during a recovery. Because the recession likely ended in the third quarter of 2009, jobs should start returning in the middle of 2010 as employers become more confident that improvements will last, Basu said.

Meanwhile, government employment shields Southern Maryland from the worst effects of the downturn, according to Alan Dillingham, a professor of economics at St. Mary's College of Maryland.

"If you take a shorter run view of change, [just] January and February 2010, Maryland has net job loss," Dillingham said. "But again, job loss is concentrated in construction and some other sectors of the economy, including financial services. But on the government side, employment goes up by 6,000. I think that's kind of an example of the benefits in this area of having government employment."


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