Unlike many states, Maryland has historically had a relatively robust and diversified economy that allows it to maintain healthy growth. But the future of Maryland's economy, like that of the nation, is uncertain.
Underpinning its economic diversity is a highly educated workforce — one of the nation's highest ratios of Ph.D. holders — and virtually full employment. There are a large number of well-paying jobs in government, health care and education. The unemployment rate was just 3.6 percent last year, among the nation's lowest. And Maryland ranks fifth in personal income in the nation.
The federal government acts as a stabilizing force in Maryland's economy. "Maryland is blessed by its geography," said Daraius Irani, director of the Regional Economic Studies Institute at Towson University outside Baltimore.
The Department of Defense's Base Realignment and Closure process, for example, will create an estimated 40,000 to 60,000 new jobs and 28,000 new households in Maryland, starting as early as 2009. This will help reverse the state's ailing housing and construction industries.
The Port of Baltimore generates more than $1 billion in revenue and accounts for about 128,000 jobs. And the weak dollar has actually helped fuel an increase in international demand for U.S. goods. A surge in sales of U.S.-made autos has made Baltimore the top vehicle export port in the nation. Efforts are also being undertaken to boost its cruise line industry, which also bodes well for future growth of the port.
The manufacturing sector, however, continues to disappoint and accounts for increasingly fewer jobs as it continues to shrink. While the loss of these jobs has slowed in the past three years, it remains the biggest economic drag on the state's economy. Maryland is trying to shift from labor-based manufacturing jobs to more science and knowledge-based jobs. But attempts to lure large international corporations have been hurt by the high cost of doing business in the state.
Housing prices in Maryland are expected to drop more than 10 percent in the next year, slightly less that the national average. For several consecutive years more people have moved out of Maryland than moved in, largely because of people searching for cheaper housing.