The numbers were encouraging for retailers in May, but the same couldn?t be said for the region?s Realtors, employers and job seekers.
HOME PRICES SLIP AGAIN
Home prices continued a seven-month downward slide in Baltimore City and its five surrounding counties in May. Median home prices fell to $270,000 from $273,000, a decrease of 1.14 percent, according to data gathered by Metropolitan Regional Information Systems.
Also, the housing market hasn?t reached a bottom, economist Anirban Basu said.
“Fundamental forces of supply and demand suggest that prices have further to fall,” said Basu, president and CEO of Baltimore-based Sage Policy Group. “Buyers will remain somewhat disengaged from this market. It is quite likely that the market will continue to struggle along for the balance of the year through to 2009. The bottom may be achieved in 2009 assuming mortgage rates stay well-behaved.”
The market might pick up with the election of a new president, which historically has the ability to lift consumer perception, boost energy and gas relief, and make more credit available, Basu said. While the job market remains intact, mortgage rates must still be enticing to consumers both willing and able to buy, Basu said.
RETAIL SALES REBOUND
Maryland?s retail sales tax receipts rebounded in May, increasing about 3 percent from the year before, according to data from the state Comptroller?s Office.
“After a steep decline in April, the sales tax showed some growth in May,” Comptroller Peter Franchot wrote in a recent memo on May sales numbers.
Sales tax receipts declined about 6 percent in April from the year before, one of the worst month-over-month decreases since at least fiscal 1982, according to the Comptroller?s Office.
The largest part of the sales tax revenues came from consumers goods, which increased about 4.4 percent, but consumer goods sales are up only 0.9 percent for the year, according to the Comptroller?s Office.
“Year-to-date, revenues are slightly under expectations, with underperformance in the individual income tax, sales tax and tobacco tax offset by strong performance from most other revenue sources,” Franchot wrote.
Maryland?s general fund corporate income tax receipts grew 17.4 percent, and lottery sales increased 7.1 percent.
STATE UNEMPLOYMENT HITS 4 PERCENT
The state?s unemployment rate jumped to 4 percent in May ? the highest it has been in 2 1/2 years ? from 3.6 percent in April.
Maryland employers added 1,100 jobs in May, but that wasn?tenough to offset the more than 13,000 people who entered the state job market.
“Maryland?s economy is not immune to the financial stresses caused by the credit crisis and rising energy and food costs, and we are seeing the effects of those factors,” Department of Labor Secretary Thomas Perez said in a statement.
Nationally, new applications filed for unemployment insurance held steady at a high level of 384,000 this week, the U.S Labor Department said Thursday. The number of people continuing to draw unemployment benefits climbed to 3.1 million, the most in more than four years. Employers have cut jobs each month so far this year as they cope with fallout from high energy prices, the housing slump and harder-to-get credit.
“Regardless of whether the economy is technically in a recession, growth has been so sluggish that job prospects are poor ? especially for the long-term unemployed,” said Chad Stone, chief economist with the Center on Budget and Policy Priorities.
Nationally, private employers cut their payrolls for the sixth straight month in May, and nearly one in five unemployed workers has been looking for a job for more than six months, according to the Department of Labor.
“Weakness and the prospect of further labor market deterioration are sources of concern no only for the long-term unemployed and their families, but the economy as a whole,” Stone said.
Anthony Fair and The Associated Press contributed to this article.
