Maryland is boosting its efforts to attract new manufacturers to the state, and help its existing manufacturers grow and add jobs, with a new program called More Jobs for Marylanders. The program, which was passed in the 2017 legislative session and took effect June 1, provides tax incentives for new and existing manufacturers to create thousands of jobs, and also has a workforce component designed to improve worker skills.
Approved by the Maryland General Assembly, More Jobs for Marylanders was the centerpiece of Governor Larry Hogan’s Maryland Jobs Initiative to provide greater support to the state’s manufacturing industry and create jobs in areas of the state where they are most needed.
“Since day one the focus of our administration has been on restoring Maryland’s economy and putting more people to work. We have already seen incredible success – we have added nearly 111,000 new jobs and lowered unemployment to four percent,” said Governor Hogan. “The More Jobs for Marylanders Act incentivizes and encourages manufacturers to create thousands of jobs in the areas of the state that need them the most, like Baltimore City, western Maryland, and the lower eastern shore, while also offering benefits to both workers and job creators across the state.”
While Maryland has historically enjoyed a strong manufacturing industry, with some companies still going strong after more than 100 years, in recent decades the state’s manufacturing workforce had been shrinking. About 25,000 of these jobs – nearly 20 percent of jobs in the industry – were lost between 2007 and 2013.
But with the growth of advanced manufacturing in Maryland and the emergence of new technology, the industry is poised to rebound—which could put Maryland on the cutting-edge of the modern manufacturing industry.
Today, more than 3,600 manufacturing operations in the state employ more than 103,000 people. Maryland manufacturers have an annual economic output of $20 billion and pay $7.5 billion in annual wages. The average manufacturing salary—$73,000—is 28 percent higher than the state average.
This program gives Maryland a new set of tools to build on the progress and momentum already generated by manufacturers all across the state. In recent years, employers like Frito-Lay in Harford County, EVAPCO in Carroll County, Pinnacle Foods in Washington County, and Harbor Design and Manufacturing in Baltimore City have all announced plans to move to or expand in Maryland, creating hundreds of new jobs.
What are the benefits? New manufacturers opening shop in high-unemployment (Tier 1) counties and creating at least five new jobs may be qualified to receive a 10-year income tax credit based on the number of jobs created; state property tax exemption; a refund of sale and use tax for specific purchases; and a waiver of all state filing fees. Tier 1 counties are Allegany, Dorchester, Somerset, and Worcester counties and Baltimore City, as outlined by Bureau of Labor Statistics and Bureau of Economic Analysis data. The Maryland Department of Commerce designated three additional Tier 1 counties: Baltimore, Prince George’s and Washington. Tier 2 counties make up the remainder of jurisdictions in the state.
Existing manufacturers in the state that create at least five new jobs in a Tier 1 county, or 10 new jobs in a Tier 2 county, qualify for the 10-year income tax credit based on the number of jobs created.
Starting in 2019, the program also allows for faster depreciation of new capital investments, thereby freeing up capital more rapidly for companies to hire new employees and reinvest in their business operations.
“This is a huge step forward for Maryland’s manufacturing industry and will enable our great employers put even more Marylanders to work and bring even more high-quality products to consumers,” said Regional Manufacturing Institute president Michael Galiazzo. “I commend Governor Hogan and the Maryland General Assembly for recognizing the incredible value our manufacturing job creators bring to our great state, and for helping ensure the industry will continue to grow and thrive in the years to come.”
Through August, more than two dozen companies, ranging from manufacturers of metal, construction products, wood, and food, had filed a notice of intent to apply for the program.
The program also helps to strengthen the manufacturing workforce in Maryland by providing $1 million in funding for one of the state’s most popular programs, the Partnership for Workforce Quality (PWQ). The PWQ program provides matching training grants, up to 50 percent, and support services targeted to improve the competitive position of small and mid-sized manufacturing and technology companies. Grants are used to increase the skills of existing workers for new technologies and production processes, improve employee productivity and increase employment stability. To qualify for PWQ, companies should have a minimum of 10 full-time employees and priority is given to manufacturing and technology companies.
The More Jobs for Marylanders program also provides $1 million in workforce development scholarships for eligible students enrolled in job training programs at community colleges, and contains measures to encourage high schools to offer additional vocational training, as well as requiring state agencies to analyze their registered apprenticeship programs. This builds on the Hogan administration’s strong commitment to encouraging apprenticeships throughout Maryland’s nationally-recognized Employment Advancement Right Now (EARN) workforce training program, which has already provided training for nearly 2,000 unemployed or underemployed workers. The program also provides a $1,000 income tax credit for each apprentice a manufacturer employs with a cap of $500,000 per year.
How to Qualify?
- Be a manufacturer that would qualify for sectors 31, 32, and 33 (except refiners) as determined by the North American Industrial Classification System.
- Offer ongoing job training or a post-secondary education program such as tuition reimbursement.
- A new manufacturer must notify the Maryland Department of Commerce of its intent to be designated eligible before it establishes a facility in the state.
- An existing manufacturer must notify the department of its intent before creating new jobs.
- New and existing manufacturers in Tier 1 counties must create at least five new, qualified jobs. These jobs must be created within 12 months of the business’ Notice of Intent.
- Existing manufacturers in Tier 2 counties must create at least 10 new qualified jobs. These jobs must be created within 12 months of the business’ Notice of Intent.
- The business must be certified by the Maryland Department of Commerce as a qualified business entity.
For more information about the More Jobs for Marylanders Act and how to apply visit commerce.maryland.gov/morejobs.
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