Many in So. Md. see no uptick in economy

Recession's end not yet visible to those polled by CSM

Wednesday, Jan. 27, 2010

The recession ended last fall, economists say, but it lives on in the perceptions of Southern Marylanders, almost half of whom believe the economy was worse in November than it was a year before, according to Pulse of Southern Maryland, a survey conducted occasionally by student volunteers at the College of Southern Maryland.

Statistics suggest Southern Marylanders have reasons to be skeptical of a national recovery.

The most recent news from the U.S. Department of Labor has the national unemployment rate holding at 10 percent, but the figure was accompanied by speculation that joblessness would be even higher except that workers are giving up altogether on finding work.

The last reported figure for Maryland was 7.4 percent.

At the same time, Southern Marylanders' confidence in all levels of government was relatively high, with 60 percent of participants saying they felt satisfied or very satisfied with the federal government's response.

Forty-four percent felt the same about state politicians, while more than half were pleased with local government.

Women were more likely than men to have neutral feelings about government in general, while those 22 to 30 were more likely to express dissatisfaction with the federal government than any other age group.

According to Anirban Basu, chairman and CEO of Sage Policy Group, a Baltimore-based economic consulting firm, Southern Marylanders are wrong to think the region is worse off than it was a year ago because most indicators are encouraging, and Southern Maryland, buffered by increased federal investment, has suffered less than the state and nation as a whole.

"In the last year the economy has made significant progress. I think one of the reasons [the low confidence] happened is people may have forgotten how treacherous economic times were a year ago, in part because things have improved since that time," Basu said.

"It is true that unemployment remains elevated, hiring remains quite weak, but over the past year there's been significant slowing in job loss, stabilizing unemployment rates, significant growth in homes sales, decline in the number of unsold homes listed for sale, a remarkable retracement on the Dow Jones and other financial indicators that have helped to replenish wealth and expansion in gross domestic product, beginning with the third quarter of last year," he said. "Each of these items is consistent with the notion that the economy is on the mend."

Basu, who had not read the survey, said he was surprised by the high confidence in government, but said Democratic President Barack Obama's charisma might boost attitudes toward the federal government in general.

Women surveyed were more pessimistic than men, with only 15 percent of women believing the economy has improved, compared with 22 percent of men.

Also, those in households earning less than $30,000 annually were most likely to say the economy is worse, and least likely to say it has improved.

Those surveyed by CSM making more than $100,000 were most likely to be optimistic.

Acting on their anxieties, female respondents were of a more frugal bent than men in every category of saving. Twenty-four percent of women reported no lifestyle changes in response to the economy, 6 percentage points lower than men. Overall, 26 percent of respondents reported no change in spending habits, more than a third of people held off on major purchases or ate out less often to save money, while almost a third have cut down on their traveling.

Wynne Briscoe of Prince Frederick might be an exception. The recession did not deter her from launching her Forever Eden skin care line last year.

She said she thinks starting up during a recession actually gives her a competitive advantage over firms used to better times.

"Those who came out in this, it's all we know," she said, unlike businesses "used to having things handed to them."

In answer to the question "Which of the following rising costs give you the most concern?" taxes and transportation costs were of most concern, with more than a quarter choosing each.

Credit card bills were of least concern at only 13 percent, but anxiety about costs varies across groups, with women more likely to be concerned about basic necessities like food and utility bills and men more likely to fret about taxes and credit card bills.

Households making less than $30,000 were concerned about food and utility prices, with 18 percent naming each as their biggest worry.

Those earning between $30,000 and $60,000 were more concerned about transportation costs than any other group, though the issue was of concern for all income groups.

For households making more than $100,000, the cost of food was of least concern, and taxes were of greatest concern.

Those between 18 and 21 were more likely to be concerned about credit card bills than any other group, while more than half were most worried about transportation costs, a level almost twice as high as that in any other group.

Thirty-seven percent of those older than 65 in the survey indicated they were most concerned about taxes while only 7 percent of this age group were most worried about credit cards.

Pat Russell of Hollywood is familiar with these concerns, having started a landscaping and handyman business to keep himself afloat after losing a job at Patuxent River Naval Air Station and being unable to find another one. But he is hopeful about the future.

"I think, personally, I think it is a little better, it's come around a little bit. Not back to the way it was. People have a tendency to watch when they spend and where they spend it," Russell said. Business for him is good but "very competitive," hinging on providing good customer service to those still willing to hire others for chores. Making a living is now very hard work.

"It was either go broke or bust it, and that's how it is ever since," he said.

emitrano@somdnews.com

About the survey

The survey was conducted by telephone by 87 student volunteers at the College of Southern Maryland on Nov. 10 through 12 and Nov. 17 last year. The numbers were selected randomly from the telephone book.

The 692 respondents were roughly proportionally representative of the three counties, with 24 percent of respondents from Calvert County, 46 percent of respondents from Charles County and 30 percent from St. Mary's County.

The three counties' populations respectively comprise 27 percent, 42 percent and 30 percent of the region's total.

The margin of error was 3.5 percentage points.

Sampling error increases when broken down by sex, age and other characteristics, meaning the results are less reliable. The survey summary said "caution should be used when making inferences about the data" on these bases.

The margin of error for women was 4.5 percentage points and 6 for men, according to Kathleen Rottier, CSM's executive director of planning, institutional effectiveness and research.

Margins for income and age were not available but, "When the results are broken down within income and age, the survey results admittedly have their limitations and we caution making inferences from that data. … To not report the results by age or income would be to miss some of the more interesting results," she wrote in an e-mail.

The margin error for responses by income level will be particularly high because more than a quarter of respondents declined to say how much they earn.

"We don't find that surprising. A lot of people are reluctant to share that. For that particular subgroup, by income level only, looking at responses based on income, it may impact the results," Rottier said.