The Maryland State House steps. File photo by Bryan Sears.
Maryland’s Senate president warned of a “Maryland recession” Tuesday, after a top bond rating agency released a report highlighting the state’s unique vulnerability to federal budget and employment cuts coming from the Trump administration.
“We have to brace for a Maryland recession. That is the news that we are receiving,” Senate President Bill Ferguson (D-Baltimore) told reporters.
State officials have been bracing for a hit to the state’s finances since President Donald Trump took office and — under the guidance of billionaire Elon Musk and his U.S. DOGE Service — began slashing federal jobs and freezing government spending.
But a Moody’s Ratings report that Ferguson was refererencing said Maryland ranks “at or near the top for risk from changing federal priorities and policies.”
The report, which was released Monday, highlights three factors that place Maryland at more risk than any other state in the nation.
Maryland’s exposure to federal job cuts exceeds other states, according to Moody’s. In addition to a previously reported 160,000 federal jobs in the state, Moody’s adds 250,000 more federal employees who live in Maryland but work in Washington, D.C.
The report also notes that Maryland was already “confronting a large and growing budget gap even before job cuts and other downsizing objectives emerged,” but decreased tax revenue caused by federal job cuts will worsen those fiscal challenges.
Finally, Moody’s notes that “less generous federal grant policies” could encourage nonprofit research organizations to “scale back,” specifically noting Johns Hopkins University.
“When we look at all of our core priorities, the actions of the Trump administration are causing us to have to rethink everything from public safety to health care to education,” Ferguson told reporters. “And it is no surprise that it’s validated by this Moody’s report today that everything continues to have to be on the table, because it’s not just about filling the gap that exists.”
– This story will be updated.