The General Assembly got some bad news, and then some relatively good news about the state’s economy Monday.
The Senate Budget and Taxation Committee and the House Appropriations Committee met with a cadre of legislative analysts to hear about the state’s fiscal situation.
The findings? We’re doing better than last year, when the state faced an estimated $1.5 billon budget deficit that was largely addressed during a special session.
But we’re not out of the woods yet. Gov. Martin O’Malley and lawmakers will have to manage carefully to avoid further deficits in the next few years, analysts said.
But some interesting statistics came out of the briefing. State revenue is heavily dependent on the state of the economy, so analysts watch it slowly for trends in job growth, construction, income, etc. Essentially, Maryland is doing OK compared with some other states, because job growth has stayed up.
Some highlights:
- Payroll employment in the state grew almost 1.5 percent in 2007, compared to the national economy, where the growth was less than 1 percent.
- But, existing home sales fell last year by nearly 40 percent. That’s not a huge surprise, and it’s happened in the past few years as well. But the big news here is that for the first time median home price fell as well.
- And even though the state saw solid job growth figures, the housing swoon is making itself apparent on the labor scene. Average construction employment fell last year, a sharp contrast with 2006, when there were more than 5,000 new hires in the industry. In the financial activities sector, average employment fell by more than 2,000 jobs.
