By Del. Cory McCray
Keeping a steady focus on careers instead of just creating jobs will help add longevity and health to Maryland’s economy.
We ended fiscal year 2016 with a $250 million deficit and we are expected to receive around $300 million less in the current fiscal year. In 2017, legislators in the Maryland General Assembly will be faced with tough decisions because of the deficit. But why have we collected less revenue than expected?
According to Andrew Schaufele, director of revenue estimates, as reported by the Baltimore Sun, “weak tax collections largely reflected a slow recovery and sluggish gains in Marylanders’ earnings despite improving employment numbers. The jobs Maryland’s economy has been gaining lately have disproportionately been low-paying, temporary positions.”
Comptroller Peter Franchot stated that, “while a few more Marylanders have jobs, overall wages continue to fail to keep pace with the cost of living for too many families.”
Slow wage growth
Suppressed wages seem to be unique to Maryland. Wage growth is above 3% nationally. Our surrounding jurisdictions, Virginia and Delaware, are above 3%. Maryland’s economy, however, lags behind with just 2% wage growth.
Poor wage growth has a detrimental effect on our neighborhoods, local businesses, and future generations. The bottom line: when Marylanders have less money in their pockets we all feel the effects. So how did we get here and how can we fix it?
In the state of Maryland we negotiate deals with private developers to lease buildings for state use, but not once have we considered whether the workers constructing or maintaining the buildings are making a good wage, have healthcare, or some form of retirement. More importantly, we have failed to use our available resources.
Specifically, we have failed to utilize registered apprentices who are governed by the Maryland Department of Labor, Licensing and Regulation (DLLR) and are protected by their regulations. This has to change.
In Maryland, we often rely on Tax Increment Financing (TIF) to incentivize private development. In Baltimore City, we just negotiated the largest TIF program in the state. A private developer has leveraged Maryland taxpayer dollars to the tune of $600 million to build public infrastructure and public parks, but not once have we considered whether the workers constructing the infrastructure are making a good wage, have healthcare, or some form of retirement.
Failing to use registered apprentices
This is another instance where we have failed to utilize registered apprentices. Because of its large scope, there is a possibility that this development could adversely affect the wages of Marylanders across the state – if the private developer decides to suppress workers’ wages.
In Maryland, we contribute a large percentage of our capital dollars to hospitals, universities, and nonprofits in the form of bond bills or by making carve-outs in the capital budget. While many of those projects are worthy of receiving help from Maryland taxpayers, those projects are a contributing factor to suppressed wages. A large percentage of these projects are not utilizing registered apprentices. And by the way, this isn’t done in any other state in our region.
Apprentices registered with DLLR are required to receive on the job training and educational training. They are guaranteed that – for each successful year in their registered apprenticeship program – their wages and employment status will advance, and DLLR tracks their advancement and holds employers accountable. Now is the time to demand more for our workers.
Suppressed wages and the lack of revenue coming into Maryland is a problem for our state. It contributes to the current budget deficits.
We must take a hard look at our method for leasing properties, awarding TIFS, and Maryland capital projects funding the construction of hospitals, universities and nonprofits. When thinking of creative ways to address these issues we must put a central focus on registered apprenticeships. It is a common-sense solution that will help put our fiscal house in order.
Cory McCray is a Democratic delegate in the 45th Legislative District representing Northeast and East Baltimore City. Email : firstname.lastname@example.org