Washington Area Economy: Performance and Outlook Presentation to: - PowerPoint PPT Presentation

Washington Area Economy: Performance and Outlook Presentation to: Arlington Economic Development Commission Mark C. White, Ph.D. Deputy Director Center for Regional Analysis Schar School of Policy and Government George Mason University June 12, 2018 1

Agenda • US economic trends • The Washington regional economy • The continued influence of the federal government • Additional ongoing challenges • The contributions of foreign-born, non-citizen workers to the regional workforce • Looking ahead 2

U.S. Gross Domestic Product Quarterly Change Real GDP (Billions) 6.0 $18,000 $17,500 5.0 $17,000 4.0 $16,500 3.0 $16,000 % 2.0 $15,500 $15,000 1.0 $14,500 0.0 $14,000 -1.0 $13,500 -2.0 $13,000 2010 2011 2012 2013 2014 2015 2016 2017 2017 +2.3% 2018Q1 +2.2% Source: Bureau of Economic Analysis (Seasonally Adjusted, Chained 2009 Dollars )

US Payroll Jobs Month-to-Month Change (000s) Total (Millions) 400 150 2016- 350 2017 145 2.36M 300 250 140 May 200 +223K 135 150 100 130 Since 50 2010 0 125 +18.9 M 2013 2014 2015 2016 2017 2018 Source: Bureau of Labor Statistics (Seasonally Adjusted), GMU Center for Regional Analysis

The Washington Regional Economy 5

GDP Trends since 2001 6

Annual Job Change -Washington MSA 000’s MOTYC Non-Farm Jobs 000’s 110 3,350 3,300 90 3,250 3,200 70 3,150 Apr 17- 3,100 Apr 18 50 +38.7 K 3,050 3,000 30 2,950 2,900 10 2,850 -10 2,800 2012 2013 2014 2015 2016 2017 2018 April-18 Total: 3,308 K Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

15 Largest Job Markets Job Change: April 2017 – April 2018 4.0% 3.5% 3.0% 2.5% Washington +1.2% 2.0% 1.5% 1.0% 0.5% 0.0% Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

Unemployment Rates in the WMSA By Sub-State Area 12 10 5.0 – DC 8 3.9 – U.S. 3.5– SMD 6 3.1– MSA 2.4 – NVA 4 1.9 – ARL 2 0 Source: Bureau of Labor Statistics (Region - Not Seasonally Adjusted, US – Seasonally Adjusted)

Professional & Business Services drive the regional economy – April 2018 Professional & Business Services 22.9% Education & Health Services 13.7% Federal Government 11.1% State & Local Government 10.4% Leisure & Hospitality 10.2% Retail Trade 8.5% Other Services 6.4% Construction 4.9% Financial Activites 4.9% Information 2.3% Transportation & Utilities 2.1% Wholesale Trade 1.9% Manufacturing 1.7% 0% 5% 10% 15% 20% 25% 10 Source: US Bureau of Labor Statistics, Current Employment Statistics

Job Change by Sector April 2017 – April 2018 Washington MSA (000s) (Ranked by Size in 2017) Total = 38,700 Prof. & Bus. Svcs 7.3 Educ & Health Svcs 9.7 Federal Govt. -4.6 State & Local Govt 3.7 Leisure & Hosp. 8.5 Retail Trade 2.9 Other Services 2.1 Construction 2.1 Financial 3.2 Information 1.1 Transp. & Util. 4.3 Wholesale Trade -1.6 Manufacturing 0.0 -6 -4 -2 0 2 4 6 8 10 12 Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

Covered Employment in Washington MSA 22.6% Professional & Business Services 21.9% Government 13.0% Education & Health Services 10.5% Leisure & Hospitality 8.8% Retail Trade 5.5% Other Services 5.0% Construction 4.7% 2018 Financial Activites 2.2% Information 2008 2.0% Transportation & Utilities 1.7% Manufacturing 1.7% Wholesale Trade 0% 5% 10% 15% 20% 25% 12 Source: EMSI

Covered Employment in Arlington Professional & Business Services 32.6% 22.2% Government 10.5% Leisure & Hospitality 8.3% Education & Health Services 6.4% Other Services 5.3% Retail Trade 5.1% Transportation & Utilities 3.9% Financial Activites 2018 3.0% Information 2008 1.2% Construction 0.8% Wholesale Trade 0.6% Manufacturing 0% 5% 10% 15% 20% 25% 30% 35% 13 Source: EMSI

The Economic Influence of the Federal Government 14

Federal Government Washington MSA (000s) (000s) 30 390 25 385 20 380 Feb 17- 15 Feb 18 375 -6,600 10 370 5 365 0 360 -5 MOTYC 355 -10 Total 350 -15 Jobs -20 345 2010 2011 2012 2013 2014 2015 2016 2017 2018 February-18 Total: 362K Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

Federal Procurement in the Washington MSA 1980-2017 (Fiscal Years) $ Billions 90 82.4 TOTAL = $1,388.5 Billion 79.9 77.6 80 76.3 75.0 71.2 69.1 71.1 70 60 50 40 30 20 10 0 Source: US Census, Consolidated Federal Funds Report and USAspending.gov

Professional & Business Services Washington MSA (000s) 25 780 20 760 15 740 Apr 17- 10 720 Apr 18 +7.3K 5 700 0 680 -5 660 MOTYC Total Jobs -10 640 -15 620 2010 2011 2012 2013 2014 2015 2016 2017 2018 April-18 Total: 751.5K Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

Professional and Business Services Employment and Federal Employment in Washington, DC Metro Area Compared to the Previous Year, 2012-2018 25.0 Prof. & Business Services Federal 20.0 Month over the Year Employment Change (000s) 15.0 10.0 5.0 0.0 -5.0 -10.0 -15.0 -20.0 2012 2013 2014 2015 2016 2017 2018 Source: US Bureau of Labor Statistics, Current Employment Statistics 18

The DC Metro is a leader in Cyber-security Information Security Analysts (SOC 15-1122) by metro area, 2017 Washington 13,520 New York 7,380 Dallas 3,560 Chicago 3,400 Minneapolis 3,200 Boston 3,110 Los Angeles 3,030 Philadelphia 2,460 Atlanta 2,430 Charlotte 2,360 Phoenix 2,360 SF-Oakland 2,270 Baltimore 2,170 St. Louis 1,970 Denver 1,740 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 19 Source: U.S BLS Occupational Employment Statistics (May 2017) and GMU Center for Regional Analysis

Additional ongoing challenges 20

Population and employment trends in the Washington Metro Area 130 125 120 Population/Employment (2000=100) 115 110 105 100 Population Employment 95 90 21 Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis Source: US Census Bureau Population Estimates, US Bureau of Labor Statistics Quarterly Census of Employment and Wages

Population and employment trends in Arlington 22 Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

Arlington is fully immersed within the broader regional workforce Where Arlington residents work Where Arlington workers live (2015) (2015) *19.5 percent of workers living in Arlington, also work *15.4 percent of workers working in Arlington, also in Arlington live in Arlington 23 Source: US Census Bureau, Longitudinal Employer-Household Dynamics, OnTheMap

The region has experienced net domestic out-migration since 2013 120,000 120,000 100,000 100,000 • This trend started sooner in 37,183 places like Arlington- 80,000 80,000 Alexandria and suburban 41,048 39,715 39,358 45,410 44,760 Total Population Change Maryland. 45,606 Population Change 60,000 60,000 • People move here for jobs, 49,016 then choose a place to live in 40,000 40,000 the region. 49,169 47,790 48,651 • Many factors cause them to 47,832 44,882 42,616 20,000 20,000 consider other metro areas 23,864 6,843 3,143 0 0 • Note the continued Net Int'l Migration -21,543 importance of Int’l migration -23,209 -31,483 -31,492 Natural Increase -20,000 -20,000 to the region’s continued Net Domestic Migration growth Total Change -40,000 -40,000 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015 2015-2016 2016-2017 24 Source: US Census Bureau, Population Estimates Program, V2017

Long commutes diminish quality of life Proportion of workers with travel time to work of 60 or more minutes New York 21.8% Washington 17.8% SF-Oakland 17.2% Atlanta 14.5% Chicago 14.1% Boston 13.8% Los Angeles 13.3% Seattle 12.2% Philadelphia 11.6% Houston 11.2% Miami 10.7% Dallas 9.3% United States 9.1% Arlington Phoenix 7.6% 7.6% Detroit 7.2% Source: US Census Bureau, 2016 Minneapolis 5.5% American Community Survey, 0% 5% 10% 15% 20% 25% 25 Table S0802

Median House Sales Price Washington MSA (000s) Arlington 700 600 $560K 500 $442 K 400 May 2018 300 200 100 Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

The contributions of foreign-born, non-citizen workers to the Washington region’s workforce 27

Source: 2016 American Community Survey, Public Use Microdata Sample (PUMS) files 28

Most Foreign Born, Non-Citizens originate from Latin America El Salvador 23.5% India 6.2% Guatemala 6.1% Mexico 5.8% Honduras 5.6% Ethiopia 3.1% China 3.0% Bolivia 2.9% Philippines 2.7% Canada 1.0% Bangladesh 0.7% 0% 5% 10% 15% 20% 25% Proportion of Total Foreign-Born, Non-Citizen Workers 29 Source: US Census Bureau ACS 2016, GMU Center for Regional Analysis

Source: 2016 American Community Survey, Public Use Microdata Sample (PUMS) files 30