Economic Performance Improves as Maryland Enters Recovery
Firms Across State Bullish on Gains in Sales, Employment
May 2, 2011
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The first-quarter Maryland Business Climate Survey—produced by the University of Baltimore's Jacob France Institute in the University's Merrick School of Business—indicates the beginnings of a sustained economic turnaround, with key indicators such as sales and jobs remaining in positive territory for the first three months of 2011. A clear majority of businesses participating in the survey say they believe the Maryland economy is poised to continue to expand, and they are generally pleased with the overall business climate.
But is it the end of the recession? Only time will tell, but by mid-year it may be clear that the recovery was already "maturing" in early 2011.
"It's not possible or advisable for economists to say from day to day whether the recession is dead and buried," said Richard Clinch, director of economic research at the Jacob France Institute. "It's better to let business tell us what they're seeing now, and what they expect to see in the coming months. Based on that assessment, it appears that we have entered a period of recovery, and that recovery appears to be maturing this spring. Soon, it may become apparent that it's grown strong enough to stand on its own, producing month after month of job growth, stronger sales and a Maryland economy that can begin to flex its muscles again—perhaps even later in 2011."
Clinch pointed to the 39 percent of surveyed Maryland firms that reporting improved sales in the first quarter, up from 37 percent in the final quarter of 2010. Of the surveyed participants, 27 percent noted growth in their employment—a 9 percent increase from the previous quarter.
A majority of firms surveyed expect the market for their products and services to continue to expand in 2011 (63 percent), with only 9 percent expecting a market contraction. Sixty-six percent expect to increase their sales in the coming year, a rise of eight percent since the last quarter.
The positive numbers follow a year in which Maryland Business Climate Survey participants expected to make gains in 2011, but saw the state's economy waver between growth and stasis.
"Part of a maturing recovery is about going through that kind of pain," Clinch said. "It's difficult to experience growth followed by a period when not much is happening. But 2011 is off to a significantly better start. I believe we're better poised to have sustained growth in our state, although I don't expect it will be a boom by any measure."
Every quarter, the Maryland Business Climate Survey takes the pulse of the state's economy by surveying 250 Maryland companies, gathering data on employment, sales, the availability of skilled workers, the ability of businesses to compete, and so on. The survey is produced by the non-partisan Jacob France Institute, the economic research arm of UB's Merrick School of Business.
The University of Baltimore is a member of the University System of Maryland and comprises the School of Law, the Yale Gordon College of Arts and Sciences, the College of Public Affairs and the Merrick School of Business.