Mar 26, 2010 0
Every month, the state reports unemployment statistics and every month, at least lately, the message that accompanies those statistics follows a formula, something like “things have gotten worse, but they’ve gotten worse less quickly than they have before, so that’s a good thing.”
The numbers released by the state on Friday were made more interesting by the context provided by Gov. Martin O’Malley on Thursday.
O’Malley signed into law a $20 million tax credit program that will give businesses $5,000 for every unemployed Marylander they hire in 2010, up to $250,000 per business. The Department of Labor, Licensing and Regulation expects to start taking online applications for the credits next week.
Less than a day later, DLLR reported that the state’s unemployment rose to 7.7 percent in February, up from 7.5 percent in January. The number of unemployed Marylanders hit 227,524, up from 222,196 the month before.
If businesses decided to take advantage of all the available tax credits and hired 4,000 people immediately, that still would not bring the state’s unemployment situation from the February level down to the January level. That probably says more about the enormity of problem, rather than the scope of the solution.
“While there continue to be signs of improvement in the economy, we are still seeing significant pressure on the job market,” said Labor Secretary Alexander M. Sanchez in a written statement. “Both the unemployment rate and job creation statistics may continue to move erratically as the economy strives to move ahead.”
Maryland lost 68,300 jobs from Feb. 2009 to last month. Of those losses, 13,800 were lost between January and February.
Those figures also have big implications for the Unemployment Insurance Trust Fund, which was the focus of another bill the governor signed Thursday. His overhaul of unemployment benefits will bring the bankrupt trust fund $126.8 million from the feds.
The fund has opened a line of credit with the U.S. Department of Labor to keep paying benefits and state officials hope the one-time infusion brought by the overhaul will keep the state from borrowing again this year. But that assumption is based on the employment situation improving this year. Persistent, high levels of unemployment would be bad news for the fund.