In late August, Governor Larry Hogan announced that Lidl, the Germany-based grocery store chain that has emerged as America’s fastest growing retailer, would open 10 new stores and add 400 jobs in Maryland by the end of 2021, more than doubling its footprint in the state.
The new stores, part of a $500 million U.S. expansion, include locations in Annapolis, Brooklyn Park and Glen Burnie in Anne Arundel County and in Columbia in Howard County.
“This is more good news for our economic recovery, and will help more Marylanders get back to work,” Hogan said.
But it’s not only grocery stores that are adding jobs. Businesses throughout the food sector have experienced a boost due to a convergence of COVID-19 adjustments and a general trend toward local, sustainable sourcing.
“COVID-19 has actually increased the need for more help, especially for farms that are growing produce and selling at markets or have on-farm stores,” said Kathy Johnson, director of Agricultural Business Development for the Howard County Economic Development Authority (HCEDA). “I believe we will see an increase in food-related job creation, at least for a couple of years, because this has started a cycle that is creating an upswing of people wanting to buy local.”
Rumors of a possible food shortage over the winter months may also increase the likelihood of customers buying more food from local farmers, she said.
The pandemic has forced many consumers to change their buying habits, which affected businesses throughout the supply chain.
In April, U.S. Secretary of Agriculture Sonny Perdue also announced the establishment of the Coronavirus Food Assistance Program (CFAP) and the Farmers to Families Food Box Program that is partnering with regional and local distributors whose workforce has been impacted by the closure of restaurants, hotels and other food service entities.
The initial Food Box program has allocated up to $3 billion for the purchase of fresh produce, dairy and meat products for delivery to food banks, community and faith-based organizations and other non-profits serving Americans in need.
According to Mark Powell, chief of Agriculture and Seafood Marketing for the Maryland Department of Agriculture, a number of Maryland’s food producers have benefitted from the new program.
“Sudano’s Produce at the Maryland Food Center Authority in Jessup has received contracts worth more than $30 million for the program,” he noted. “Coastal Sunbelt in Laurel received $12.6 million, and CGC Holdings in Jessup had contracts worth $2.6 million.”
Patricia Kanashiro, associate professor of International Business at Loyola University’s Sellinger School of Business, said there may not be any hard evidence that these grants are helping to increase the number of jobs, “but if we look at data from the USDA, they claim that for every $1 million in revenue there are 13 jobs created, three times more than compared to regular retail stores.”
At the same time, she said, it’s easy to overlook the trickle-down effect that may be tied to the change in consumer habits.
“There are family farms, those who own warehouses where food is stored, individuals who distribute, process or sell food,” she said. “The chain is comprised of many players, and there is an economic impact from keeping the sales in the local economy as well.”
What is measurable, however, is the amount of attention lavished on Maryland by big grocery retailers.
“In the last decade, grocery store chains have been very interested in locating in Maryland because of the higher income of consumers here,” Powell said. “It’s been a hot market with Harris Teeter coming in, Wegmans expanding, Aldi, and all of these other chains that are interested in Maryland.”
Producers are also interested in central Maryland.
“We’re seeing interest from out-of-state companies that are looking to focus here because of all the processing companies that are already established here,” Johnson said.
“They’re interested in either locating in the Maryland Food Center Authority or in the surrounding areas around Jessup.”
According to Kanashiro, the Bureau of Labor Statistics projects an 8 percent increase in the number of farming jobs in Maryland in its Long-Term Occupational Projections over the decade that ends in 2028, compared to a national average of only 3 percent.
“That may be a result of local public policies, Marylanders’ consumer profile compared to other states, or even Maryland’s [untapped] agricultural potential,” she said.
Moreover, the same data indicate a 13.3 percent projected increase for food processing jobs in the state, compared with the national average of 1.8 percent.
Many local farm jobs are seasonal, Johnson said, but some farmers are considering growing food over the winter months to extend their sales period or provide food for food banks, which could create additional jobs.
“Job growth in agriculture doesn’t happen overnight and it’s been difficult to connect unemployed people with these jobs because of transportation issues,” she said. “But I foresee an increase in jobs and new opportunities down the road because the demand for locally grown food has increased due to COVID, and hopefully people will realize there’s good opportunity there.”
By George Berkheimer | Senior Writer | The Business Monthly | November 2020 Issue