Maryland's Jobless Rate Ticks Upward

Following national trends, Maryland’s unemployment rate rose slightly in June as new hiring was dampened by a sluggish economy and concern over the fiscal deadlock in Washington, the state’s top labor official said Friday.

Alexander Sanchez, secretary of the Maryland Department of Labor, Licensing and Regulation, said the state’s unemployment rate rose to 7 percent in June, compared to 6.8 percent in May.

The statewide statistics closely tracked the national numbers for June, in which unemployment rose to 9.2 percent, compared with 9.1 percent in May, Sanchez said.

Locally, a number of high-profile employers contributed to the trend by eliminating jobs in central Maryland—Superfresh grocery stores, Solo Cup, Verizon Wireless, Nationwide insurance and General Dynamics all engaged in job cuts at central Maryland facilities.

The statistics translate into 208,341 Marylanders officially out of work, according to preliminary data from the national Bureau of Labor Statistics. The state’s total number of residents employed in the civilian sector stood at 2,990,509, virtually unchanged from the previous month.

“June was another soft month,” Sanchez said, in a series of disappointing monthly reports since April, when new hiring in the state stalled.

“It seems like a cliché, but when it comes to success, there are no shortcuts. While other states have taken the national economic downturn as an opportunity to cut corners, attack working families, weaken collective bargaining, and defund important workforce initiatives, Maryland has made the tough choice” to reject those measures, Sanchez continued.

“And we’ve done this even while cutting $6.8 billion from the state budget and eliminating 4,800 state jobs,” he said.

The real impact of unemployment in the state is even worse than the official numbers indicate, said Neil L. Bergsman, director of the Maryland Budget & Tax Policy Institute.

Taking into account unemployed workers no longer actively seeking new jobs, and marginally employed workers, the real unemployment rate is about 12 percent, Bergsman said.

“Overall, this new jobs report shows no progress in jobs or unemployment. Essentially, we are standing still,” he said.

Bergsman said he agreed with Sanchez that one damper on new employment was the failure by the federal government to resolve the issue of raising the national debt limit. Failure to do so has created uncertainty about the future of the economy and therefore acted as a deterrent to new hiring, he said.

“I feel certain that Congress’ irresponsible refusal to act on the debt limit is a big part of the problem,” Bergsman said.

Aside from having a lower unemployment rate than the national average, another comparatively bright spot for Maryland is that the state’s unemployment insurance trust fund is in good shape, Sanchez added.

“Maryland is one of only 20 states to maintain a solvent unemployment insurance trust fund,” he said.

“While other states’ trust funds are in debt to the federal government and face the threat of higher premiums to employers in future years, Maryland’s fiscal responsibility during difficult times will help lower payroll expenses for employers,” and make the state more attractive to businesses, the labor secretary said.

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