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Report: Baltimore region’s diversity grew with shift from manufacturing to professional services

Report: Baltimore region’s diversity grew with shift from manufacturing to professional services

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Donald C. Fry, president and CEO of the Greater Baltimore Committee. (The Daily Record / Maximilian Franz)
Donald C. Fry, president and CEO of the Greater Baltimore Committee. (The Daily Record / Maximilian Franz)

The Baltimore region has grown more affluent, educated and diverse over the past 20 years as its focus has changed from manufacturing to higher education, medicine, cybersecurity and technology, according to a new report.

But the report, released Monday, also raised questions about how the region’s growth and change will interact with that diversity.

“As we become wealthier and more expensive, what does that do to poor populations of any race, but what does it mean to our minority populations?” asked Mike Kelly, executive director of the Baltimore Metropolitan Council. “Are they keeping pace?”

The 2018 Greater Baltimore State of the Region Report from the Greater Baltimore Committee and the Baltimore Metropolitan Council looked at how the region performed in more than 80 statistical indicators and how that performance has changed since 1998, when the report was first published. The report also compared how the Baltimore region stacks up to 19 other peer regions, including Washington, Austin, Boston and Dallas.

In some areas, Baltimore’s growth stood out.

The median income in the Baltimore region has more than doubled since 1998, to $76,788, the third-highest growth rate among the cities surveyed.

The region’s gross domestic product also nearly doubled. The 95.5 percent growth was good for seventh among surveyed cities.

“I think the income is probably tied together with some of the change in the switch from a manufacturing industrial type base to more of a professional services, again the high technology some of the knowledge based industry,” said Donald Fry, president and CEO of the Greater Baltimore Committee. “This is a look at the entire region. …We have to recognize that there has been significant growth in these areas particularly in Howard County and Harford County related to BRAC and some of the base (realignment).”

But Baltimore saw regression in other indicators.

The city’s downtown office vacancy rate was 18 percent, 17th among the cities surveyed. In 1998, by contrast, the downtown office vacancy rate was 8 percent, ranking seventh.

Much of the region’s jobs have moved to the suburbs, near employment centers like Fort Meade, and economic engines like medicine and higher education do not lease traditional office space.

And while the number of businesses grew nearly 8 percent (as measured by establishments with payroll), the increase puts Baltimore 17th out of the 19 regions. By comparison, Dallas saw the most growth, increasing the number of businesses by more than 79 percent.

In terms of diversity, African Americans grew to be 29 percent of the Baltimore region’s population, a growth of 130 percent that ranked fourth among the peer cities. But the number of black-owned businesses accounted for approximately 5 percent of all firms. The city’s 45 percent growth in black-owned businesses ranked 11th in the survey.

“GBC has been looking at this for a number of years through our Bridging the Gap program,” Fry said. “We are going to be looking more seriously at the small business financial element in the city, which could be beneficial because access to capital is one of the real challenges that everybody has.”

The report also confirmed what just about anyone who drives to work already knows: Commutes in the region are bad and only getting worse. The average commute time has increased 5 minutes, to 31 minutes, dropping Baltimore from 15th to 17th in the rankings.

At the same time, because many of the jobs have moved away from public transportation infrastructure, the percentage of workers using public transit has fallen from 8 percent to 6 percent. But that 6 percent still ranks sixth among the cities surveyed. And the people who use transit use it more often, as rides per capita per year have risen from 43 to 49, good for sixth among peer cities.

“This is a trend nationally that population and jobs are growing outside of cities. The reality is that it is very expensive to develop suburban transit,” Kelly said. “We also as a region need to think about where we are incentivizing businesses to go to make businesses accessible to existing.”

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