In Maryland, forecast calls for more hires -- Gazette.Net


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It’s a new year, and Mandy Lippman is feeling better about her company’s prospects.

Since launching Environmental Cost Efficiencies, which primarily sells BigBelly Solar compacting and recycling stations, out of her Rockville office in 2007, Lippman has distributed the systems to the National Institutes of Health in Bethesda, Johns Hopkins University in Baltimore, Cassidy Turley in Reston, Va., and other clients. In the last two months, interest has grown, with repeat business from both private and public customers, she said.

Hiring slows

Hiring in Maryland slowed in the first 11 months of 2012 from the same period in the two previous years, when job growth rebounded more quickly from the Great Recession of 2007-09.

2012: +14,600

2011: +35,000

2010: +24,500

2009: -61,100

2008: -34,800

Source: U.S. Department of Labor

“There is a market if you have a product that fulfills a need,” Lippman said Wednesday after demonstrating the solar-powered station’s capabilities at the Universities at Shady Grove. The Rockville campus was the first university in Maryland to purchase the system several years ago.

“There is increased interest in products that can save clients money through innovation,” Lippman said. “There has been a change in how receptive people are to innovative products.”

That heightened receptivity is translating into the potential for hiring more contractors to install and maintain the trash compacting and recycling systems. With its compacting capabilities that utilize a solar-powered sensor, the units can hold up to five times the volume of the average trash receptacle, she said.

“Based on the type of jobs, I am looking to work with additional contractors,” Lippman said. “And for other aspects of my business, I am looking to work with additional independent contractors, such as a bookkeeping service. I have found that independent contractors are a better bet [than hiring full-time employees] for my small business, and that is the direction I am focused on.”

Lippman’s optimism is being felt by many executives in Maryland and nationwide. About 22 percent of companies in Maryland plan to hire more employees in the first quarter this year, up from 17 percent in 2012’s first quarter, according to a recent survey by employment services company Manpower Group.

The Maryland outlook is rosier than the nationwide one, where 17 percent of businesses say they plan to grow their workforce by March 31. Job prospects are strongest in professional and business services, as well as information technology, according to Manpower.

However, the more sanguine outlook hasn’t really translated into a big hiring increase so far. In fact, job growth slowed in 2012 as Maryland added only about 15,000 jobs from January to November, down from 35,000 and 24,500 in the same periods in 2011 and 2010, according to federal labor figures.

Employers that have been piling up profitable quarters say factors such as the fiscal cliff and a lack of qualified employees put a damper on their hiring plans last year. But data show that the job shortage is occurring at all levels of education, Heidi Shierholz, an economist with Washington, D.C., think tank Economic Policy Institute, said in a report this week.

“Workers with a college degree or more still have unemployment rates that are close to twice as high as they were before the recession began,” Shierholz said.

“Unemployment is high not because workers lack the right education or skills, but because employers have not seen demand for their goods and services pick up enough to need to significantly ramp up hiring,” she said.

Profit margins down

One reason for the slower hiring trend could be that profit margins for many businesses still are down, said Ylrico Alexander, COO of Aries Enterprises. The Upper Marlboro shredding, construction and recycling company has a stronger hiring outlook this year and hopes to grow to 25 employees from its current 15 by the end of the year, he said.

“We are seeing the economy turning,” Alexander said.

Still, clients continue to be more price-focused these days.

“That’s something we all are having to deal with,” Alexander said.

The four-year-old business also is looking at health insurance plans as it prepares to exceed 50 workers in the future, at which point it will need to provide employees insurance or pay a penalty under the Affordable Care Act.

“We believe we will eventually grow to beyond 50 employees, so we are planning for the future,” Alexander said.

Gaithersburg food and facilities management company Sodexo is another employer that plans to hire in the near future, adding about 50 jobs over the next three years and agreeing to keep its North American headquarters in the city. Company officials were persuaded to stay, in part, by loans and other incentives from the state, Montgomery County and the city totaling some $4 million.

In White Marsh this week, executives of academic, business and governmental certification testing company Prometric announced plans to hire about 100 more people in the near future as it builds a $12 million support facility near its Baltimore headquarters. Prometric, which now has more than 450 employees in Maryland, has seen seven consecutive years of revenues and profit growth.

Sparks engineering firm KCI Technologies and Brotman Financial Group in Timonium are other Baltimore County employers seeing a hiring uptick.

“We’re doing very well,” said Michael Myers, operations manager of KCI, which has some 1,100 employees in more than 25 locations, with about 400 in Maryland.

M&T Bank of Buffalo, N.Y., the second-largest depositor bank in Maryland, is coming off a “tremendous” 2012, “positioning us well for continued success in 2013,” CFO Rene F. Jones said this week in a conference call. M&T’s Maryland deposits grew to $18.0 billion in 2012, up about 4 percent from the previous year.

Maryland tops states in construction firm outlook

Construction, an industry that has been slow to recover from the Great Recession, should see a more robust year, especially in Maryland, according to a recent Associated General Contractors of America survey. Some 56 percent of construction companies in Maryland plan to add jobs this year, the most among states and well above the national average of 31 percent.

The positive outlook from construction companies in the state comes as many report a decline in government projects. Hospitals and higher education buildings are fueling the surge. However, Gov. Martin O’Malley’s proposed capital budget for fiscal 2014, announced this week, includes $336 million for school construction and upgrades, which would support more than 8,100 jobs, according to his office.

The stronger outlook in Maryland stems not just from its proximity to the federal government, but an optimism about more specific markets such as water and sewer, transportation, private office and schools, said Brian Turmail, executive director of public affairs for the Associated General Contractors of America of Arlington, Va.

“Those are all markets where nationally contractors are a lot less optimistic,” Turmail said.

Still, there are some signs of trouble for all builders; for example, the large majority of construction companies report an increase in the cost of raw materials.

Concern over federal budget

Many companies in Montgomery County still are concerned about what is happening with the federal budget, said Georgette Godwin, president and CEO of the Montgomery County Chamber of Commerce. On New Year’s Day, Congress put off for two months across-the-board cuts in projected federal spending increases known as sequestration.

But the county still is well-positioned to capitalize in key areas such as information technology and cybersecurity, she said.

“Businesses are by nature optimistic,” Godwin said. “I would say there is a cautious optimism about the economy this year.”

The emphasis on reducing the federal budget deficit will weigh on job growth in suburban Maryland and the Greater Washington, D.C., region, according to the 2013 first-quarter economic report from PNC Financial Services Group.

“Job growth will be close to the national average [in Greater Washington], instead of leading it, as was the case during the previous expansion,” PNC economists said.

Even though sequestration is a concern, it’s not as if federal agencies aren’t going to spend any money, Lippman said.

“The key is to submit proposals that fulfill their needs,” she said.

kshay@gazette.net