Despite nationwide concerns of a coming recession in 2020, local economic development experts think Frederick County is equipped for continued growth and economic development.
Experts all year predicted a recession would come either in 2019 or 2020, though many of those prognosticators have since scaled those predictions back.
Frederick’s diverse economy makes the county more resilient to economic fluctuations, said Helen Propheter, director of the county’s economic development office.
And while the county is preparing for a potential economic downturn, she said they expect 2020 to be an even stronger year than 2019.
In order to best position the county for a potential downturn, the economic development office recommends buying local to support businesses, employees and their families and building a strong relationship with the bank because that relationship will be crucial in tough times. They also encourage business leaders to promote lifelong learning, saying businesses with strong leadership that understand the economic environment and the workforce are able to pivot to handle large changes in the economy.
Chamber of Commerce President and CEO Rick Weldon also expressed little concern about a possible economic downturn, adding that many challenges facing businesses are brought on by partisan politics.
“I just wish that national politicians of both parties would just shut up and get out of the way of business,” Weldon said. “That would be a great start.”
The economy is just as likely to expand in 2020 as it is to retract, Weldon said. The county is likely to see a record number of startups in the coming year, in large part because of FITCI, the tech business incubator that Weldon called the best anywhere.
Much like their concerns about a potential recession, Weldon and Propheter share a similar outlook that the county’s single most important issue in 2020 will be to develop a qualified and capable workforce.
The county celebrated major wins in recent years such as Kite Pharma, Navistar Direct Marketing and Daly Marketing choosing Frederick, Propheter said. But it needs a pipeline of employees to send to those companies.
“Our focus has to be on educating tomorrow’s workforce to be ready to take the jobs that will be created here in the county,” Weldon said. “STEM education will be the key.”
While STEM education is key, so is a commitment to trades. Weldon praised partnerships between Frederick County Public Schools, Hood College, Mount St. Mary’s University and Frederick Community College in providing workforce educational programs and apprenticeships.
“There are incredibly rewarding jobs in the skilled trades that don’t require a college degree, just a hardworking apprentice with a solid skill set,” Weldon said.
With a county that is propelled predominantly by small businesses, increases to the minimum wage will also present a challenge to local businesses. The minimum wage jumps to $11 an hour in 2020 as part of a phased-in process to get to $15 an hour.
For Propheter, the response has been a mixed bag. The challenge isn’t just increasing wages for minimum wage employees, but increasing wages for other employees accordingly.
“For some businesses this isn’t an issue and for others it is a big issue as it’s adjusting their salary scale to make room for the minimum wage increase and increase other employees at the same time,” Propheter said. “For those businesses, they have communicated with us that they will be forced to hire less staff to both meet this law and their bottom line.”
But as 2020 nears, there are still plenty of growth opportunities in Frederick County’s business community despite some of the challenges. While Frederick will remain strong in its biotech and IT presence, Propheter and Weldon see several emerging industries making their way to Frederick. The addition of the e-commerce center for Goodwill is likely just the beginning of a foray into e-commerce in the county, Propheter said. And while the craft beverage industry has seen immense growth, she expects to see more businesses in that field pop up in 2020 too.
The recreation destination and experiential business boom is also likely expected to continue, Weldon said. After adding Stumpy’s Hatchet House, Tree Trekkers and a virtual reality gaming shop in 2019, more entertainment hubs, including District 40 at the old Frederick Towne Mall site are in the pipeline.
“I still think we’ll see growth and expansion in the craft beverage industry, more restaurants and food service experiences, exciting new agri-tourism and steady growth in health care and allied health, but biotech and IT will continue to be our bedrock,” Weldon said.