Key to Job Creation: Improve Maryland's Business Climate
In the last four years, Maryland has plummeted from 24th to 45th on the nation's list of business-friendly states.
We have lost in the competition to attract new business, such as the decision in April by Northrup Grumman to locate their national headquarters in Virginia instead of Maryland. In recent months, we have also lost corporate headquarters (Black & Decker) and manufacturing jobs (BP Solar in Frederick)
Under Governor Robert L. Ehrlich, Jr., Maryland's unemployment rate was 3.5%. However, the unemployment rate has steadily increased under Governor O'Malley's tenure and is approaching 8%. While the recession has been a factor in job losses, Maryland's deteriorating business climate has also contributed to high unemployment and has stymied the state's economic recovery.
Governor Martin O'Malley heralded his job creation package during the last session. The administration's bill could lead to the creation of 4000 jobs if fully implemented. Unfortunately, the Bureau of Labor Statistics released new job loss figures at the same time. The number of O'Malley's new jobs (4000) pales in comparison to the 13,800 Maryland jobs lost just in the month of February. Maryland was fifth worst in the country for job losses in February.
O'Malley's economic development policies operated under the misguided assumption that government creates jobs. Instead of signing tax credits for job creation, O'Malley should be sponsoring legislation to lower Maryland's corporate tax rate and other business-friendly measures as a means to grow jobs, stimulate economic growth and attract new businesses to the state.
However, O'Malley turned the state in the opposite direction. He raised the corporate rate as part of his historic tax increases during the 2007 special session. He also created tax surcharge on high income earners that has driven motivated and creative business people to leave the state. These measures are examples of the misguided policy from O'Malley that contributed to Maryland's poor business climate.
From the start, the next Governor and State Senators must focus on the multitude of measures to improve Maryland's business climate, return the state's reputation as a great place to do business and create new jobs that will stimulate Maryland's economy.