The Washington County area continues to outpace the state and the nation in the recovery of jobs lost to the COVID-19 pandemic.
But inflation and Russia’s invasion of Ukraine pose risks to the worldwide economy, said Adam Scavette, a regional economist at the Baltimore branch of the Federal Reserve Bank of Richmond, Va.
And for some, such as restaurants in and near the nation’s capital, recovery could depend on when people resume working in their offices instead of at home, he said during a conference call Friday.
“The fundamentals of the economy are quite strong,” Scavette said.
Maryland gained another 3,900 jobs in March, according to preliminary data released Friday by the U.S. Department of Labor’s Bureau of Labor Statistics.
Compared with this time last year, Maryland jobs are up by 92,100.
Scavette said 2,200 of those jobs were added in the Hagerstown-Martinsburg metropolitan statistical area.
In this region, the Leisure and Hospitality sector saw the most growth with an increase of 700 jobs over the past year. Trade, Transportation, and Utilities added 600, and the Professional Services sector grew by 500 jobs.
Maryland’s job number is 2.8% lower than what it was in February 2020, before the pandemic, Scavette said. The U.S. total is down by about 1%.
In this region, the total is down by 0.7%, he said.
He said businesses in the Leisure and Hospitality sector — think restaurants and hotels — in areas like Prince George’s County outside Washington, D.C., are struggling to add workers.
Job creation there might depend on getting other workers back into their offices, he said. Many of those people started working remotely, and stopped eating so many restaurant meals, when the pandemic hit.
Scavette said it “isn’t quite clear what the new equilibrium is going to be.”
‘Risk from this situation in Ukraine’
The Labor Department said Tuesday that its consumer price index jumped 8.5% in March from 12 months earlier. It was the sharpest year-over-year increase since 1981.
Prices have been driven up by bottlenecked supply chains, robust consumer demand and disruptions to global food and energy markets worsened by Russia’s war against Ukraine.
From February to March, inflation rose 1.2%, the biggest month-to-month jump since 2005. Gasoline prices drove more than half that increase.
At the same time, Scavette said, demand for workers is at or near an all-time high and the fundamentals of the U.S. economy remain solid.
He said there is a “risk from this situation in Ukraine” to the world economy.
“We’ve seen this happen before,” Scavette said.
Some analysts compare this situation to 1991, when Iraq invaded Kuwait. The United States and its allies expelled the Iraqis from Kuwait in the first Gulf War.
The conflict cut into world oil supplies, Scavette said, but Saudi Arabia increased production and a feared recession did not happen.
This time Russian petroleum exports are the issue, he said.
“It’s not clear anyone is going to be able to make up the difference in 2022-2023,” he said.
Maryland’s numbers for March
According to the Department of Labor’s Bureau of Labor Statistics, Maryland’s Leisure and Hospitality sector experienced the most growth in March with an increase of 2,900 jobs.
That was followed by Mining, Logging and Construction (1,800) and Trade, Transportation and Utilities (900).
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Other sectors that experienced growth include: Education and Health Services (600) and Professional and Business Services (400).
Seeing a decline last month was a broad sector called Other Services, which lost 500 jobs. Manufacturing was down by 500 jobs, and the Financial Activities sector lost 300 positions.
Mike Lewis covers business, the economy and other issues. Follow Mike on Twitter at MiLewis.
The Associated Press contributed to this report.
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