The Trump administration’s cuts to federal spending and jobs will have a damaging effect on Maryland’s economy, according to a new report from the state’s comptroller and the University of Maryland Robert H. Smith School of Business.
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“Federal spending is a huge part of Maryland’s economy,” said Vojislav Maksimovic, the William A. Longbrake chair in finance and professor of finance at UMD.
Maksimovic said the report found that Maryland’s federal job base is large, highly earning and until 2025, it was expanding.
Nearly 230,000 Maryland residents are employed by the federal government and work in the D.C. area, which is the third highest number of federal jobs in the country after D.C. and Virginia. The federal government also contributes $150 billion a year to Maryland’s economy.
“My team and I are closely analyzing how federal decisions — such as workforce reductions, cuts to research funding, and changes to veterans’ benefits — directly impact Maryland’s economy, families, and institutions,” Comptroller Brooke Lierman said in a news release. “This report offers us a baseline from which to measure and understand the scope of that impact.”
A second report will be released later this summer estimating the direct financial impacts on Maryland’s economy, including the budget for the 2026 fiscal year. Maksimovic also talked about the multiplier effect, and the importance of analyzing long term impacts.
“It’s important to know how big the problem is, who’s going to be affected, and how we can go ahead and address those issues,” Maksimovic said. “The question that comes about is, what are the ripple effects?”
Researchers are also creating an interactive digital tool to let users see how changes in federal funding affect specific counties and communities.
The full report is available online.
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