Unemployment & Labor Market

Baltimore's unemployment rate stands at 3.6%, within the healthy range of 3.5–4.5%. However, the year-over-year increase of 0.9 percentage points indicates a rising rate, signaling labor market weakening. Although the current level suggests relative tightness, the upward trend implies deteriorating conditions compared to the prior year.

Workforce Supply

The civilian labor force in Baltimore is contracting, with a year-over-year decline of 0.62%. This decline in the available worker pool raises concerns about shrinking participation, outmigration, or demographic decline, which can constrain long-term economic growth and reflect underlying structural challenges in workforce engagement.

Wage Growth

Average hourly earnings in Baltimore have risen 1.42% year-over-year, a pace that falls short of the 3–4% benchmark needed to outpace inflation. With inflation exceeding this figure in recent years, workers are likely experiencing a decline in real purchasing power. This limited wage growth suggests that employers face little pressure to raise pay, possibly due to modest labor demand.

Labor Demand

Baltimore's labor demand is weak, as indicated by a Labor Demand Composite score of 3.78 and a nonfarm employment growth rate of -0.14% year-over-year, reflecting slight job losses. Although weekly hours worked are slightly above the 12-month trend, at +0.324%, this minor demand strength is insufficient to offset the overall contraction in employment. The combination points to a softening labor market with limited near-term momentum.

Cost of Living

Baltimore's cost of living composite score is 3.11, moderate and suggesting that housing costs are relatively affordable compared to local earnings. While not among the most affordable markets, this level indicates that income-to-price ratios are not severely strained, which could support some household financial stability. However, stagnant wages may limit the practical benefit of this affordability.

Office Economy

The Office Worker Ratio Composite is 2.92, a relatively low score indicating a below-average concentration of white-collar, professional services employment. This suggests that Baltimore's economy is less anchored in high-value knowledge sectors and may rely more on government, healthcare, logistics, or lower-wage service industries. A weaker office economy could limit high-income job creation and commercial real estate vitality.

Housing — Construction

Residential building permits in Baltimore have declined 11.14% year-over-year, a significant contraction in construction activity. This sharp decline suggests waning builder confidence, limited demand for new housing, or supply-side constraints. Reduced construction could exacerbate housing shortages over time, although current market velocity data indicates soft demand.

Housing — Market Velocity

Homes in Baltimore are taking a median of 37.0 days to sell, with a 27.59% increase in days on market compared to the prior year, indicating a meaningful slowdown in buyer activity. The rising days on market reflect a cooling housing market, characterized by reduced urgency among buyers or excess supply. Despite the relatively low absolute number of days, the strong year-over-year increase signals deteriorating momentum.

Conclusion

Baltimore's economy shows signs of stagnation, with a low overall grade of C- and a weighted percentile of 31.9. While the unemployment rate remains within a healthy range, it is rising, and employment growth is negative. Wage growth is anemic, and the labor force is shrinking. The housing market is slowing, with fewer permits issued and homes taking longer to sell. Structural weaknesses include a lack of high-wage office employment and weak labor demand, although the cost of living remains manageable. Without stronger job and wage growth, the near-term outlook is subdued.