Secretary of Commerce and Trade Maurice A. Jones Presentation to - PowerPoint PPT Presentation

Secretary of Commerce and Trade Maurice A. Jones Presentation to VLGMA February 13, 2015

} Virginia was founded as a business venture more than 400 years ago. That spirit of enterprise and entrepreneurship continues to grow strong. } Virginia boasts a stable 6% corporate income tax—one of the lowest in the nation—that hasn’t increased since 1972, property tax exemptions and one of the lowest combined state/local/use taxes at 5%. } The Port of Virginia is the deepest port on the East Coast and the only port on the East Coast currently capable of handling Post Panamax vessels as a first or last port of call. } With six major interstate highways, Virginia has the third largest state maintained transportation network in the country.

} Fourteen railroads operate in Virginia, including Virginia- based Norfolk Southern and CSX. } Fourteen airports serve Virginia, including Washington Dulles International Airport. } Virginia ranks among the top 10 states best prepared to navigate the changing economy, in terms of knowledge jobs, globalization, economic dynamism, technology-driven and innovative, according to the "2014 State New Economy Index” published by the Information Technology and Innovation Foundation.

} Virginia’s higher education system is the 11 th largest in the nation. ◦ More than 80,000 graduates received associate, bachelor, master, and doctoral degrees at Virginia public and private institutions last year. ◦ More than 500,000 students were enrolled in over 90 in-state institutions of higher education last year. ◦ Virginia’s education system hosts 23 community colleges – there is one community college within 30 miles of most Virginia residents. } Our highly skilled and educated workforce is evidenced by: ◦ Over 20,000 doctoral scientists and engineers ◦ Highest concentration of private sector high-tech workers in America for seven years in a row

} Employers benefit from an influx of over 2,000 highly-trained military personnel who exit the U.S. military each year in Virginia. } Virginia is in the center of the U.S. East Coast, with nearly 50% of the U.S. population and manufacturing base located within a 1,000 kilometer radius. } The average unemployment rate in the Southeast (VA, NC, SC, GA, FL, KY,TN, AL and MS) is 6.8%. Virginia’s 5.6% unemployment rate is 1.4% lower than the average for the region and is the lowest unemployment rate in the Southeast.

U.S. Department of Defense 12. Capital One Bank 1. Walmart 13. City of Virginia Beach Schools 2. Fairfax County Public Schools 14. Loudoun County Schools 3. Huntington Ingalls Industries, Inc. 15. Inova Health System 4. Sentara Healthcare 16. University of Virginia Academic 5. and Hospital Campuses Food Lion 6. 17. Virginia Tech Cooperative U.S. Postal Service Extension Office 7. County of Fairfax 18. Virginia Commonwealth 8. University HCA Virginia Health System 9. 19. Lowe’s Home Centers, Inc. 10. U.S. Department of Homeland Defense 20. U.S. Department of Commerce 11. Prince William County School Board

(000s) Ranked by Size in 2014 Total -293 Total 190 Prof. & Bus. Svcs -25 28 Educ & Health Svcs -4 54 Retail Trade -36 26 Leisure & Hosp. -19 41 Manufacturing -69 2 Other Services -6 14 Financial -18 19 Construction -75 2 Transp. & Util. -9 4 Total Private Wholesale Trade -12 1 Sector Job Losses Information -19 ended in March Mining & Logging -2 2010 -90 -70 -50 -30 -10 - 20 40 60 80 Source: Bureau of Labor Statistics (Seasonally Adjusted), GMU Center for Regional Analysis

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Prof. & Bus. 568.0 559.5 547.0 549.3 578.5 606.1 628.5 646.3 657.0 640.1 650.4 667.5 678.5 678.2 664.6 Services State & 471.7 482.0 488.3 489.8 499.3 510.1 520.3 526.4 534.5 533.8 530.3 535.9 535.6 536.4 538.3 Local Gov’t Edu.& Health 336.2 351.9 368.7 376.5 387.6 399.5 414.4 432.0 451.9 460.3 468.0 474.9 485.0 497.1 512.8 Services Retail Trade 410.0 405.6 404.4 403.1 412.7 418.5 423.8 427.5 420.6 398.8 398.1 402.4 406.0 409.9 413.7 Leisure 297.1 301.2 303.9 308.5 320.1 329.4 338.7 345.3 349.3 341.7 341.4 349.2 358.9 366.2 368.8 Hospitality Manu- 363.6 341.2 320.0 304.9 298.7 295.8 288.1 277.8 264.8 239.3 230.5 231.0 231.4 230.6 230.6 facturing Other 160.7 168.6 177.3 176.6 179.4 181.0 181.6 185.5 188.8 185.9 184.7 187.9 192.2 193.9 197.4 Services Financial 178.9 179.9 182.1 186.4 189.0 192.5 194.8 193.7 188.7 180.0 179.1 182.6 188.3 192.1 195.2 Activities Constructio 210.1 216.9 214.3 217.5 230.9 243.6 248.8 239.9 222.9 190.3 183.1 178.5 176.6 177.3 179.3 n Federal 153.0 147.3 146.6 147.7 151.7 151.8 154.5 156.6 159.9 166.2 174.5 174.4 174.4 173.6 169.7 Gov’t Transp. & 126.4 124.3 119.2 118.8 119.1 121.4 119.5 119.7 119.0 112.9 113.0 114.9 116.0 116.2 115.1 Utilities Wholesale 114.3 114.7 112.8 113.2 114.6 117.2 119.6 120.9 119.5 112.6 110.0 111.4 111.4 111.2 111.3 Trade Information 119.0 119.1 105.8 101.4 98.3 92.7 91.6 90.4 87.4 81.1 76.0 73.7 71.7 71.1 70.3 Mining 11.5 11.4 10.6 10.1 10.3 10.7 11.3 10.9 11.1 10.2 10.4 10.9 10.9 10.1 9.9 Logging Total 3,520.5 3,523.6 3,501.0 3,503.8 3,590.2 3,670.3 3,735.5 3,772.9 3,775.4 3,653.2 3,649.5 3,695.2 3,736.9 3,763.9 3,776.8 Gained in rank between 2000 and 2013 Source: Chmura Economics & Analytics & Virginia Employment Commission

The GSP* Effects of Job Change in the Commonwealth of Virginia, March 08-Sept 14 (in billions of 2014 $s) Jo Job Change Average GSP Average GSP Value Value -294,400 $146,964 +179,500 $113,193 Net Effect -114,900 - $22,948,049,000 Source: GMU Center for Regional Analysis *Gross State Product

Sta tate te GSP Growth th 2012-2013 US US Rank Ranking ing US 1.84% Virginia 0.07% 48 th Maryland 0.01% 49 th DC* -0.49% 51 st Calculated using chained (2009) dollars Source: U.S. Bureau of Economic Analysis

Recession Impacts The state lost 293,000 jobs • Impacts of Federal Spending Reduction Federal procurement $s down by 15.2% from peak in 2011 • DoD procurement down 21.8%, or $9.8 b • There are 13,700 fewer federal jobs • Federal payroll is down 7.5% or $1.16 billion •

Sectors (largest 1 st ) GSP per Job* Professional & Business Services $126,267 Prof., Scientific, Technical $156,892 State and Local Government $69,102 Education/Health Services $63,890 Retail Trade $58,253 Hospitality Services $38,540 Manufacturing $178,652 Other Services $63,290 Construction $82,378 Federal Government $151,070 Military $121,681 Financial Services $242,966 Transport &Utilities $152,458 All Jobs in the Commonwealth $107,461 Sources: IHS Global Insight; GMU Center for Regional Analysis

Higher-Wage Mid-Wage Lower Wage (100) (80) (60) (40) (20) 0 20 40 60 80 Th Thou ousan ands ds 2008-2009 2010-2013 Sources: QCEW & Self-Employed EMSI 2013.4& GMU Center for Regional Analysis

Ye Year Virginia Virginia U. U.S. S. 2000-2007 3.0 2.5 2008-2009 -0.8 -3.1 2012 1.1 2.8 2013 1.0 1.9 2014 1.5 2.4 2015 2.3 3.2 2016 2.6 3.5 2017 2.7 3.2 2018 2.7 2.7 Sources: IHS Global Insight; GMU Center for Regional Analysis

Federal Contract Spending FY2014 -3.7% FY2015 -4.8% Sources: Chmura Economics & Analytics, President’s Budget FY2016

0 -5,000 -10,000 -11,330 -15,000 -20,000 -21,620 -25,000 2014 2015 Source: Chmura Economics & Analytics - 2014

• Broadband • Port • Energy • Housing • Transportation • Regional Airport Traffic • Megasites • Quality of Life • Dulles

Diversify the economy by strategically growing the energy 1. sector. Innovate to reduce greenhouse gas emissions and lower 2. energy consumption throughout the Commonwealth. Strengthen our business climate by investing in reliable and 3. resilient energy infrastructure. Provide access to low-cost power in every corner of the 4. Commonwealth. Prepare Virginia’s workforce to drive the energy economy 5. into the future. 21

• Advanced Manufacturing • Modeling and Simulation • Cyber Security • Data Centers • Big data & data analytics • Federal Government: BRAC Resilience • Information Technology • International Trade • Tourism • Healthcare • Aerospace • Agriculture and Forestry • Energy • Life Sciences

} Virginia’s Life Sciences Industry employs approximately 23,000 people at over 800 establishments in Virginia. } Bioscience related distribution accounts for 29% of Virginia's Life Science Industry employment and 62% of its establishments. } Research, testing, and medical laboratories account for 48% of Virginia Life Sciences’ employment and 22% of its establishments. } Drugs and pharmaceuticals production accounts for 20% of Virginia's Life Sciences Industry employment and 8% of its establishments. The Medical Devices and Equipment Production accounts for 6% of Virginia’s Life Sciences Industry employment and 6% of its establishments.