Baltimore, February 5, 2026
The Trump administration’s policies have severely affected Maryland’s contracting industry, resulting in nearly 25,000 federal job losses and numerous canceled contracts. Local businesses face economic challenges stemming from these disruptions, prompting legal responses from Maryland’s Attorney General. Nevertheless, there is a cautious optimism among firms for potential recovery in the coming year as they anticipate improvements in revenue and demand.
Impact of the Trump Administration on Maryland’s Contracting Industry
Baltimore, Maryland – The Trump administration’s policies have significantly disrupted Maryland’s contracting industry, leading to substantial job losses, contract cancellations, and economic challenges for local businesses.
Federal Job Losses and Contract Cancellations
Between January and November 2025, Maryland experienced a loss of nearly 25,000 federal jobs, accounting for approximately 8% of all federal position eliminations nationwide during this period. This reduction was primarily due to the administration’s cuts, which had a more pronounced impact on Maryland than any other state. The federal workforce in Maryland represents 6% of the state’s overall employment and 10% of its total wages.
In addition to job losses, the administration’s policies led to the cancellation of numerous federal contracts. Notably, the U.S. Agency for International Development (USAID) saw its contracts in Maryland canceled, directly affecting companies and workers involved in these projects.
Legal Actions and Policy Changes
In response to these disruptions, Maryland’s Attorney General, Anthony G. Brown, has taken legal action against the administration’s policies. In December 2025, he joined a coalition of 19 states in suing over the imposition of a $100,000 fee on new H-1B visa petitions, arguing that it unlawfully created a barrier for employers seeking to hire skilled foreign workers.
Furthermore, in January 2026, the Department of Justice filed a motion to dismiss its appeal of a final judgment that blocked the administration’s attempt to impose immigration enforcement requirements on Department of Transportation grants, amounting to over $1 billion annually for Maryland. This move effectively resolved the case in favor of Maryland and the 21 other states involved.
Economic Impact on Maryland Businesses
Maryland businesses have reported adverse effects due to federal policy changes. A report indicated that nearly 45% of firms experienced negative impacts from reductions in federal employment, while 36% faced challenges stemming from changes in procurement and contracting policies. These disruptions have led to delayed payments, administrative issues, and the termination of programs supporting minority-owned businesses and environmental initiatives.
Future Outlook
Despite the challenges, there is cautious optimism among Maryland businesses for 2026. Firms anticipate improvements in revenue, demand, and hiring over the next six months, reflecting hope that the adverse effects of 2025 may be easing.
Background Context
Maryland’s economy is closely tied to federal activities, with the federal government employing at least 229,000 residents and contributing significantly to the state’s economy through wages, contracts, and grants. The administration’s policies have introduced uncertainties, particularly in sectors like renewable energy, where projects such as the Maryland Offshore Wind Project have faced challenges due to federal funding cuts.
Conclusion
The Trump administration’s policies have had a profound impact on Maryland’s contracting industry, leading to job losses, contract cancellations, and economic challenges. While legal actions have been taken to address some of these issues, the full extent of the long-term effects remains to be seen. Maryland businesses continue to navigate these challenges with cautious optimism for the future.
FAQ
What were the main impacts of the Trump administration’s policies on Maryland’s contracting industry?
The administration’s policies led to nearly 25,000 federal job losses in Maryland, accounting for approximately 8% of all federal position eliminations nationwide during this period. Additionally, numerous federal contracts were canceled, directly affecting companies and workers involved in these projects.
What legal actions has Maryland taken in response to these federal policies?
Maryland’s Attorney General, Anthony G. Brown, joined a coalition of 19 states in suing over the imposition of a $100,000 fee on new H-1B visa petitions, arguing that it unlawfully created a barrier for employers seeking to hire skilled foreign workers. Additionally, in January 2026, the Department of Justice filed a motion to dismiss its appeal of a final judgment that blocked the administration’s attempt to impose immigration enforcement requirements on Department of Transportation grants, amounting to over $1 billion annually for Maryland.
How have Maryland businesses been affected by these federal policy changes?
Maryland businesses have reported adverse effects due to federal policy changes. A report indicated that nearly 45% of firms experienced negative impacts from reductions in federal employment, while 36% faced challenges stemming from changes in procurement and contracting policies. These disruptions have led to delayed payments, administrative issues, and the termination of programs supporting minority-owned businesses and environmental initiatives.
Is there any optimism for Maryland’s contracting industry in the future?
Despite the challenges, there is cautious optimism among Maryland businesses for 2026. Firms anticipate improvements in revenue, demand, and hiring over the next six months, reflecting hope that the adverse effects of 2025 may be easing.
How significant is the federal government’s role in Maryland’s economy?
Maryland’s economy is closely tied to federal activities, with the federal government employing at least 229,000 residents and contributing significantly to the state’s economy through wages, contracts, and grants. The administration’s policies have introduced uncertainties, particularly in sectors like renewable energy, where projects such as the Maryland Offshore Wind Project have faced challenges due to federal funding cuts.
Key Features
| Feature | Details |
|---|---|
| Federal Job Losses | Nearly 25,000 federal jobs lost in Maryland between January and November 2025, accounting for approximately 8% of all federal position eliminations nationwide during this period. |
| Contract Cancellations | Cancellation of numerous federal contracts, including those from the U.S. Agency for International Development (USAID), directly affecting companies and workers involved in these projects. |
| Legal Actions | Maryland’s Attorney General joined a coalition of 19 states in suing over the imposition of a $100,000 fee on new H-1B visa petitions. Additionally, the Department of Justice filed a motion to dismiss its appeal of a final judgment that blocked the administration’s attempt to impose immigration enforcement requirements on Department of Transportation grants, amounting to over $1 billion annually for Maryland. |
| Impact on Businesses | Nearly 45% of Maryland firms experienced negative impacts from reductions in federal employment, while 36% faced challenges from changes in procurement and contracting policies, leading to delayed payments and administrative issues. |
| Future Outlook | Despite challenges, there is cautious optimism among Maryland businesses for 2026, with expectations of improvements in revenue, demand, and hiring over the next six months. |
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