Friday Five
July 24, 2026 | This week's latest on Maryland business and government
1 — Why Maryland’s economy trails Virginia’s despite similar Trump federal job cuts
Maryland and Virginia lost a similar number of federal jobs during recent workforce reductions, but their economies have responded very differently, with Virginia ranking third overall in CNBC’s Top States for Business while Maryland placed 36th overall and ranked 49th for its economy. Economists and business leaders say Maryland’s heavier reliance on federal employment, combined with long-standing challenges such as slower private-sector growth, higher business costs and affordability concerns, has left the state more vulnerable to economic shocks and less competitive than neighboring states.
Cut the red tape: Maryland leaders must consider remedies to address our state's declining rankings, including cutting regulations, reducing permitting delays and generating incentives to attract and retain businesses.
2 — Maryland home construction is slumping, can Congress fix it?
Maryland is on pace for its weakest year of homebuilding since the Great Recession, even as a new bipartisan federal housing law creates financial incentives for states and local governments to increase housing production and remove barriers to development. Housing experts say the state's persistent shortage of homes, limited inventory and slow pace of construction have contributed to affordability challenges and prompted many residents to relocate to states with lower housing costs. Supporters believe the new law could encourage faster permitting, zoning reforms and redevelopment projects, but they caution that Maryland will need to significantly accelerate construction to improve affordability.
Connected: Maryland's sluggish home construction market reflects a broader competitiveness challenge. Local policies that disincentivize housing construction, high taxes and an overall high-cost environment are contributing to Maryland's limited housing supply.
3 — PJM Interconnection electricity price hits cap again
Electricity prices across the 13-state PJM Interconnection region, including Maryland, reached the auction price cap for the second consecutive year, signaling continued strain on the power grid as demand — driven largely by data centers — continues to outpace available power generation. While the price cap is expected to save consumers billions compared with an uncapped auction, energy experts warn the region still faces reliability concerns and elevated electricity costs because new generation is not being added quickly enough to replace retiring power plants. Policymakers, regulators and industry leaders are calling for reforms to accelerate new energy projects, strengthen grid reliability and help stabilize electricity prices in the years ahead.
Why it matters: Higher electricity prices and ongoing grid reliability challenges increase operating costs for Maryland employers, underscoring the need for policies that expand energy supply, strengthen infrastructure and support the state's long-term economic competitiveness.
4 — House, Senate leaders draw hard line on special session topics
Maryland legislative leaders have limited the Aug. 3–5 special session exclusively to congressional redistricting, barring lawmakers from introducing unrelated legislation despite calls from some members to address issues such as affordability, energy costs and other pressing policy concerns. House and Senate leaders said the narrow scope is intended to keep the session focused on responding to recent legal developments affecting congressional maps and ensuring any constitutional changes can move forward efficiently. Others who argue the special session should also tackle broader challenges facing Maryland residents and businesses.
A closer look: Republicans were expected to file a number of bills focusing on utility costs, gas tax holiday, lowering costs of vehicle registration fees and other affordability issues. “Those are the issues we feel are important to Marylanders, not congressional redistricting,” Senate Minority Leader Steve Hershey said. Additionally, legislators will also have to consider overriding five vetoes made this spring by Governor Moore.
5 — Understanding what unaffordability means to Marylanders
A recent poll found affordability and the cost of living remain Marylanders' top concern, but experts argue the issue is driven by multiple factors — including housing, energy, groceries, gasoline and healthcare — that each require different policy solutions rather than a single, broad approach. The analysis contends that long-term affordability depends on addressing the underlying causes of rising costs, such as increasing housing supply, expanding energy generation and grid capacity and strengthening take-home pay, instead of relying on short-term subsidies.
Where we stand: Regulatory burdens and higher taxes increase the cost of living. Reducing the cost of doing business in Maryland by lowering taxes, creating incentive programs and eliminating unnecessary regulatory burdens will create systemic change that makes the state more affordable for every Marylander.
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The Maryland Chamber of Commerce is the state’s leading business advocacy organization — committed to working with our alliance of partners on critical public policy issues. With a focus on economic development and grassroots advocacy, we impact policies that directly affect Maryland business.
