“Gov. Ehrlich and I, over the last three years, have seen the creation of 100,000 new jobs. Government didn?t do that. Businesses did that, individuals did that, risk-takers did that.” ? Lt. Gov. Michael Steele, interview in The Examiner, April 28.
Actually, government did generate many of these jobs. Some were within the government itself; some came from contracts that swelled the coffers ? and payrolls ? of businesses that depend on government work.
Looking at the government job category decline ? about 2 percent ? in the state since the incumbent governor and lieutenant governor took office doesn?t, of course, provide the entire answer.
But it is accurate to say that during Ehrlich and Steele?s administration, about 10,000 federal, state and local government payroll jobs have gone away.
That does not mean government is not creating jobs in Maryland. About 50 federal agencies and research facilities are based in the state. Maryland ranks second in federal research and development spending.
And about 25 percent of the state?s economy ? $60 billion ?derives from federal grants, wages and contracts.
Those dollars ripple through every segment of the economy.
Loyola economics professor Tom DiLorenzo notes that the explosive growth of the federal government in response to terrorism, the war in Iraq and creation of the Department of Homeland Security has “undoubtedly ?created? thousands of ?private-sector? jobs in Maryland.”
DiLorenzo makes clear that while government contractors are not formally a part of the government, they are paid with our tax dollars.
The boom in residential construction and pricing is at least partially fueled by the government workers, who account for 17 percent of the state?s work force ? and more than 20 percent of the state?s wages, and government contract workers, for whom separate statistics are not available. Again, our tax dollars at work.
Last year, construction fueled about 15 percent of job growth in the state.
The Pentagon?s base realignment and closure process is projected to bring about 50,000 new jobs to Maryland within the next six years. Those jobs will generate new ones for people who need to build homes for them and cut their hair and pump their gas and pave roads for them to drive on.
New jobs will be good for the state. But Steele might want to be more candid about one of the biggest reasons Maryland?s unemployment rate is so low and its median household income is the third-highest in the country: the federal government.
Right now, breaking out the truly private-sector jobs from the 100,000 is problematic at best because many jobs have some link to government. But we think that the statisticians at the Maryland Office of Labor Market Analysis and Information should start including federal contract jobs as a new category in their quarterly analyses of the state?s work force. Those numbers would provide a much clearer picture of the state?s job growth and employment picture.
