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Prince William Chamber of Commerce What Will the Washington Area’s and Prince William County’s Future Economies Look Like? Stephen S. Fuller, Ph.D. Dwight Schar Faculty Chair and University Professor Director, Center for Regional Analysis George Mason University March 8, 2013


Recession Recovery Patterns of GDP Past Four Recessions

% Change in GDP

25 20 1982-Q3 1991-Q1 2001-Q4 2009-Q2

15 10 5 0 0.0

2.0

4.0

6.0

8.0

10.0

12.0

Quarters After Trough Sources: U.S. Bureau of Economic Analysis, GMU Center for Regional Analysis

14.0


Annual Change in Payroll Jobs – US Month-Over-Year (000s) 4000

Jan = + 2.05 M

2000 0 -2000 -4000 -6000 -8000

20

01

.0

Source: U.S. Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis


U.S. Payroll Job Change by Sector Jan 2012 – Jan 2013 Ranked by Size in 2011

Total = 2,016

(000s)

Educ & Health Svcs

429 -31

Prof. & Bus. Svcs

467 213

Leisure & Hosp.

332 109 107 107 102 61 124

Financial Construction Transp. & Util. -43

Information

-600

21

-400

-200

0

200

400

Source: U.S. Bureau of Labor Statistics (Seasonally Adjusted), GMU Center for Regional Analysis

600


U.S. Gross Domestic Product Quarterly Change: 2007 – 2014 %

Forecast > > > > >

6 4 2 0 -2 -4 -6 -8 -10

2007-1 3 2008-1 3 2009-1 3 2010-1 3 2011-1 3 2012-1 3 2013-1 3 2014-1 3

Source: U.S. Bureau of Economic Analysis, Global Insight Feb. 11 2013


The Impacts of Decreasing Federal Spending in the Washington Area Economy


2010 Structure of the Greater Washington Economy Non-Local Business 12.0 %

Other Federal 10.7 % Fed Wages & Salaries 10.0% Total Federal 39.8%

Oth er 1

Source: GMU Center for Regional Analysis

5% % 3. t’l 2.1 In . sp .8% Hosn 1 d. As h/E alt He 4.5%

.5%

Local Serving Activities 34.8%

Procurement 19.1%


Federal Procurement in the Washington Metro Area, 1980-2012 $ Billions

0

0

0

0

0

0

0

0

19 86 .

19 89 .

19 92 .

19 95 .

19 98 .

20 01 .

20 04 .

20 07 .

0

0 19 83 .

Source: US Census, Consolidated Federal Funds Report

$75.6 B

1 12 1 0 20 2

20 10 .

0 19 80 .

90 .5 3 6 $5 TOTAL = $1,023.5 Billion 80 = 10 â&#x20AC;&#x201C; 1 0 70 < | > B 60 9 7. 0 2 $ 50 = 00 1 9 40 |< > 30 B .5 6 9 20 =$ 0 9 10 < 80| 0

| > B $80.0 B


Professional & Business Services Washington MSA (000s)

Annual Month over Year

2008

2009

2010

2011

2012

Nov

Jul

Mar

Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

Nov

Jul

Mar

Nov

Jul

Mar

Nov

Jul

Mar

Nov

Jul

Mar

2006

2002

30 25 20 15 10 5 0 -5 -10 -15 -20

Annual Data

Tot 2011 = 688,700


Federal Employment in the Washington Metro Area, 1950-2012 000s

Eisenhower

Kennedy â&#x20AC;&#x201C; Johnson

400

Nixon Ford

+ 35

Carter

Reagan

+ 17

0

Bush 1

-8.6

Clinton

- 37

Bush 2

Obama

+17.5 + 24

+ 74

350 300

-5

250

Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

2010

2007

2004

2001

1998

1995

1992

1989

1986

1983

1980

1977

1974

1971

1968

1965

1962

1959

1956

1953

150

1950

200


Federal Government Washington MSA (000s) Annual Data

2008

2009

2010

2011

Nov

Jul

Source: U.S. Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

2012

Mar

Nov

Jul

Mar

Nov

Jul

Mar

Nov

Jul

Mar

Nov

Jul

Mar

2006

2002

30 25 20 15 10 5 0 -5 -10 -15 -20

Annual Month over Year


Summary for Federal Spending Trends in the Washington Metropolitan Area, 2010-2012 • Federal Procurement Outlays declined 8.4% between FY 2010 and FY 2012. • Federal employment has declined since peaking in July 2010, losing 8,700 jobs or 2.25%. • Federal payroll declined by 0.6% between FY 2010 and FY 2011 and will continue to decline as the workforce shrinks and older workers retire and are replaced by younger workers.


The Relative Importance of Federal Spending in the Maryland-DC-Virginia Region The Region’s Share of U.S. Population 4.7% The Region’s Share of All Federal $s 9.0% The Region’s Share of All DOD $s 15.0% Share of Total Federal Spending Subject to Sequestration 21.0% Federal Spending as a Percent of the Region’s GRP in 2011 39.0%


How did the recession change the Washington Area economy?


Wash MSA Payroll Job Change: Private Sector The Great Recession and Recovery To December 2012 (000s)

Total -193

-24.5

Prof. & Bus. Svcs Retail Trade Construction

13

-36.7

23

-45

9 -3

1

Financial

-14

Information

-13

0

Manufacturing

-14

0

Transp. & Util.

52

-29

Other Services

Wlse Trade

28

0

Educ & Health Svcs Leisure & Hosp.

Total 132

6

-9

0

-5

-80 -70 -60 -50 -40 -30 -20 -10 00

1 10

20

30

40

50

Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

60

70

80


(000s)

16 Large Job Markets Job Change: Dec 2011 â&#x20AC;&#x201C; Dec 2012

140 120 100

Washington + 30,200

80 60 40 20 0 lis po ea

a

e or m l ti Ba

n in M

nt la At

rk Yo

n to us Ho

C D

ew N

Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis


Job Change by Sector Dec 2011 â&#x20AC;&#x201C; Dec 2012 Washington MSA Total = 30,200

(000s) Prof. & Bus. Svcs

10 -3

Educ & Health Svcs Retail Trade

13 12 -6 2 2

Construction 0

Financial

4 -1 -1 -1 -2

Manufacturing Transp. & Util.

-20 -15 -10

-5

0

5

10

15

20

25

Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

30


Job Change by Sector Nov 2012 â&#x20AC;&#x201C; Dec 2012 Washington MSA Total = -1,300

(000s) Prof. & Bus. Svcs

-2 1

Educ & Health Svcs

-1 1

Retail Trade

0 0

Construction

-2 0 1 0

Financial Manufacturing

0 -2

Transp. & Util.

-20 -15 -10

1

-5

0

5

10

15

20

25

Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

30


Annual Job Change Northern Virginia, 2002-2012 (000s) Annual Data

2009

2010

2011

2012

2008.0

2005.0

2002.0

60 50 40 30 20 10 0 -10 -20 -30 -40

Annual Month over Year

Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis


Job Change by Sector Dec 2011 â&#x20AC;&#x201C; Dec 2012 Northern Virginia Total 20,600

(000s) Prof. & Bus. Svcs

4 0

Educ & Health Svcs

5 8

Retail Trade Construction

2 1 -3 0

Financial

5 -1 0 0 0

Manufacturing Transp. & Util.

-20 -15 -10

-5

0

5

10

15

20

25

Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

30


Unemployment Rates in the WMSA By Sub-State Area, 2005-2012 14 12 10

8.6 – DC 7.8 – U.S.

8 6

5.7 – SMD 5.2 – MSA 4.1 - NVA

4 2 0

38

38

38 4.

0

80

39 8.

0

23

39 4.

0

66

40 1.

0

08

40 7.

0

51

40 3.

0

94

Source: US Bureau of Labor Statistics (Region - Not Seasonally Adjusted, US – Seasonally Adjusted)

2.

0


The Washington Areaâ&#x20AC;&#x2122;s PostFederally Dependent Economy


Job Growth in the Washington Area By Sector, 2012-2017 (in thousands) Sector 2012 2017 Change Percent Prof. & Bus. Ser. 697.4 841.2 143.8 20.6 Federal Gov’t 380.4 358.4 - 22.0 - 5.8 Education/Health 380.2 419.0 38.8 10.2 S & L Gov’t 309.7 321.6 11.9 3.8 Hospitality 276.8 285.0 8.2 3.0 Retail Trade 254.1 266.6 12.5 4.9 Other Services 182.8 185.3 2.5 1.4 Financial Services 150.0 154.7 4.7 3.1 Construction 146.4 201.8 55.4 37.8 Information Ser. 80.6 87.6 7.0 8.7 Other Sectors (3) 175.0 193.2 18.2 10.4 Total Jobs

3,033.4

3,314.4

281.0

9.3


Major Sources of Job Growth in the Washington Area , 2012-2017 (in thousands) Growth Sectors 2012 2017 Change Percent Prof. & Bus. Ser. 697.4 841.2 143.8 20.6 Education/Health 380.2 419.0 38.8 10.2 Construction 146.4 201.8 55.4 37.8 Sub-Totals 1,224.0 1,462.0 238.0 19.4 % Total 40.4 44.1 84.7_ _______ Totals 3,033.4 3,314.4 281.0 9.3

Sources: IHS Global Insight; GMU Center for Regional Analysis


Job Growth in Prince William County By Sector, 2012-2017 (in thousands) Sector 2012 2017 Change Percent Retail Trade* 29.5 33.2 3.7 12.5 S & L Gov’t 22.7 24.9 2.2 9.7 Prof. & Bus. Ser. 20.2 27.1 6.9 27.6 Education/Health 16.3 19.8 3.5 21.5 Hospitality 16.2 17.8 1.6 9.8 Construction 13.8 17.6 3.8 27.6 Federal Gov’t 7.8 8.0 0.2 2.0 Other Services 5.4 5.9 0.5 9.1 Financial Services 4.4 4.9 0.5 10.8 Manufacturing 4.2 4.6 0.4 8.6 Information Ser. 1.5 1.8 0.3 18.8 Total Jobs

142.1

165.5

23.4

16.5


Major Sources of Job Growth in Prince William County, 2012-2017 (in thousands) Growth Sectors 2012 2017 Change Percent Prof. & Bus. Ser. 20.2 27.1 6.9 33.8 Education/Health 16.3 19.8 3.5 21.5 Construction 13.8 17.6 3.8 27.6 Sub-Totals 50.3 64.5 14.2 28.2 % Total 35.4 39.0 60.7_________ PW totals 142.1 165.5 23.4 16.5 Metro Totals 3,033.4 3,314.4 281.0 9.3 Sources: IHS Global Insight; GMU Center for Regional Analysis


GRP Per Job in the Washington Area By Sector (in 2005 dollars) Sector 2012 2017 % Change Prof. & Bus. Services $134,750 $154,656 14.8% Federal Gov’t 138,361 138,566 0.1 Education/Health 59,730 57,508 - 3.7 S & L Gov’t 60,975 56,920 - 6.6 Hospitality 42,883 42,391 - 1.1 Retail Trade 60,807 64,136 5.5 Other Services 70,339 69,151 - 1.7 Financial Services 543,482 578,062 6.4 Construction 98,824 82,490 - 16.5 Information Services 349,868 468,376 33.9 Other Sectors 147,903 151,120 2.2 GRP per Job $130,653 $138,881 6.3


GRP Per Job in the Washington Area By Sector (in 2005 dollars) High Job Growth 2012 2017 % Change Prof. & Bus. Svs. (33.8%) $134,750 $154,656 14.8 Education/Health (21.5%) 59,730 57,508 - 3.7 Construction (27.6%) 98,824 82,490 - 16.5 Other High Value-Added Sectors Information Services (18.8%) 349,868 468,376 33.9 Financial Services (10.8%) 543,482 578,062 6.4 Federal (2.0%) 138,361 138,566 0.1 Average Metro Area GRP per Job $130,653 $138,881 6.3


Washington Metropolitan Area: Major Sources of Net New Jobs 2012-2017 Occupation Net New % of Total % Change Business and Financial 52,253 14.7 13.7 Computer, Math and Sci 33,630 9.4 14.2 Health Care (all occup.) 31,915 9.0 13.7 Office Admin Support 30,334 8.5 6.3 Sales & Related Occup. 29,246 8.2 7.0 Personal Care Occup. 23,892 6.7 15.2 Management Occupations 22,964 6.4 7.1 Education & Training 21,642 6.1 10.6 Totals 224,234 63.0 10.0 Source: EMSI Inc., GMU Center for Regional Analysis


2017 Structure of the Greater Washington Economy Non-Local Business 16.3 %

Other Federal 8.9 % Fed Wages & Salaries 7.7 % Total Federal 28.8%

Source: GMU Center for Regional Analysis

In tâ&#x20AC;&#x2122;l

3. 9%

% .6 % .2 sp 1.9 d. Ho sn As h/E alt He 7.0 % % .5 r1 he Ot

Local Serving Activities 38.0%

Procurement 12.2%


%

Economic Outlook (GRP), 2012-2017 Washington Area and Sub-State Areas (Annual % Change)

7 6 5 4 3 2 1 0 -1 -2 2001.0

NV MSA SM DC

2004.0

2007.0

Source: GMU Center for Regional Analysis

2010.0

2013.0

2016.0


Thank You Questions cra.gmu.edu


Economic Forecast, 2013-2017