Until last week, Lisa Beuche gave advice to others on getting a fresh start.
Now, she’s looking for one of her own.
Beuche, 45, was a collections caller with national bank HSBC. But like so many others this summer, she was laid off, and on Friday began an uphill battle against a brutal job market.
“Years ago I would have been a wreck,” she said outside the state’s Workforce Development Center in Baltimore County. “But as you get older you get a little more sure of yourself, but I am still a little bit nervous.”
There seems to be no shortage of troubling employment news, with unemployment rates in Baltimore City, the Baltimore metro region and Maryland reaching levels in June the areas haven’t seen in two years.
The Baltimore City rate jumped from 5.9 percent in May to 6.6 percent in June; the Baltimore metro area rate increased from 4 percent to 4.5 percent; and the Maryland rate spiked from 3.8 percent to 4.3 percent, according to the most recent data from the Department of Labor, Licensing & Regulation.
The national unemployment rate was 5.5 percent in June and increased to 5.7 percent in July.
“While the waning strength of the national economy has contributed to a tightening in statewide labor market conditions, Maryland’s economy continues to tread water,” DLLR Secretary Thomas Perez said in his June labor report.
The unemployment rates in Baltimore and Maryland haven’t been this high since July 2006, and economists think the rates will only increase during the balance of 2008.
“Over the last seven months, the U.S. economy has lost 463,000 jobs,” said Peter Morici, an economics professor at the University of Maryland. “Auto production, housing starts and the market for existing homes will not improve much until 2009 or perhaps 2010, and those conditions will feed into the rest of the economy. The jobs outlook should not improve satisfactorily until at least mid-2009.”
Layoffs widespread across nation, region
Nationally, job reductions have spread across a wide variety of industries, with companies like General Motors, Starbucks and UAL Corp. announcing sweeping cuts last month that involve thousands of jobs.
In fact, planned job cuts announced by employers in July jumped 26 percent to more than 103,000, up from almost 82,000 in June, according to outplacement consultancy firm Challenger, Gray & Christmas. The number is up 141 percent from June 2007 when employers announced about 43,000 job cuts.
“The downturn, which was isolated to the housing and financial sectors just a few months ago, has spread throughout much of the economy,” said John Challenger, CEO of Challenger, Gray & Christmas.
Transportation companies announced 17,051 reductions in July. Financial firms plan to eliminate 15,517 positions, and retail stores announced 12,160 cuts.
Locally, HSBC North America Holdings this month will close its White Marsh operation — HSBC Finance Corp. — and lay off 450 employees. With Boscov’s closing its Glen Burnie, Owings Mills and White Marsh stories, 400 people will lose jobs. The Baltimore Sun Media Group last month announced its was reducing its work force by 100 employees through buyouts and layoffs. Starbucks plans to shutter four Baltimore-area locations, cutting about 80 local jobs.
Job cuts will continue in the residential construction sector, as they have with Pulte Homes and Altieri Homes, and financial sector, said Anirban Basu, an economist with Baltimore-based Sage Policy Group. The Baltimore area — not the manufacturing center it once was — is built on health care, education and professional and business services, areas that won’t see as many reductions.
“We’re almost becoming an adjunct to the Washington, D.C., region, with defense and health care firms employing a lot of people,” Basu said.
Intern Dan Murphy contributed to this story.
| January | 55,600 | 4 percent |
| February | 53,500 | 3.8 percent |
| March | 52,700 | 3.8 percent |
| April | 49,600 | 3.5 percent |
| May | 56,800 | 4 percent |
| June | 64,500 | 4.5 percent* |
| January | 115,500 | 3.9 percent |
| February | 112,000 | 3.8 percent |
| March | 109,400 | 3.7 percent |
| April | 102,000 | 3.4 percent |
| May | 115,800 | 3.8 percent |
| June | 130,600 | 4.3 percent* |
*High since July 2006 Source: Department of Labor, Licensing and Regulation
Job seekers hunting in competitive market
The Baltimore region’s unemployment rate was 4.5 percent in June, but University of Maryland economics professor Peter Morici thinks it’s closer to 5.4 to 5.6 percent.
The reason? Discouraged job seekers.
“Many more adults are sitting on the sidelines, neither working nor looking for work,” Morici said. “If you have a two-income household and one of the earners can take care of the family, the other spouse who lost their job is staying home and taking care of the family rather than considering the jobs that are available.”
Department of Labor, Licensing and Regulation Secretary Thomas Perez knows the options are limited for Maryland’s unemployed.
“By historical standards, job creation is lagging considerably, limiting the number of available opportunities and creating increased competition among job seekers,” Perez said. “Recently passed legislation to extend unemployment benefits will provide additional support to job seekers during the current economic slowdown.”
DLLR’s Division of Unemployment last month began mailing letters to about 46,000 Marylanders who might be eligible for emergency unemployment compensation. The legislation allows for a 13-week extension of unemployment benefits.
Economists might say the economy isn’t in a recession, but the unemployed might disagree, said John Challenger, chief executive officer of outplacement consultancy firm Challenger, Gray & Christmas.
“The big worry is that the economy will continue to underperform,” Challenger said. “If that persists for several quarters, or even years, it will seem like we are in a recession, particularly for job seekers.”
