Presenter: Daraius Irani, Ph.D., Vice President, Business & Public Engagement, Towson University -- (Slide Deck)
Maryland’s economy is facing significant strain amid broader national uncertainty, with its heavy reliance on federal employment and spending making it especially vulnerable. Roughly 10% of the state’s workforce is directly tied to the federal government, leaving it exposed to federal job cuts, reduced research funding, and policy shifts. At the same time, Maryland’s long-term growth has lagged behind peer states, with slower employment gains and increasing competition from lower-cost regions drawing both businesses and residents away.
Workforce and population trends are adding to these challenges. Maryland is experiencing notable domestic out-migration, particularly among younger residents who are leaving in search of greater affordability and economic opportunity. Labor shortages persist across key sectors such as healthcare, IT, and hospitality, compounded by lower workforce participation and reliance on immigrant labor. Stricter immigration policies threaten to further constrain these sectors, while an aging workforce leaves gaps that are not being fully replaced.
Affordability pressures—especially in housing—are a major concern. High mortgage rates, chronic underbuilding, and regulatory constraints have driven up costs, making homeownership increasingly unattainable for many residents. This has contributed to delayed household formation, with more young adults living with family and the median age of first-time homebuyers rising significantly. At the same time, rising consumer debt and delinquencies reflect growing financial stress among households.
Overall, Maryland’s key industries—captured in the “eds, meds, feds, beds, and treads” framework—are all under pressure from a mix of policy changes, economic slowdown, and shifting demand. Despite strong assets, including major federal installations and higher education institutions, the state lacks a clear, forward-looking economic strategy. Addressing structural budget deficits, improving growth competitiveness, and reducing dependence on federal spending will be critical to stabilizing and strengthening Maryland’s economy.
Note: This summary was AI-generated from the session transcript and reviewed.