Washington Area Economy: Performance and Outlook

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1 Washington Area Economy: Performance and Outlook Center for Regional Analysis Schar School of Policy and Government George Mason University April 8, 219

2 U.S. Gross Domestic Product 6. Quarterly Change Real GDP (Billions) $2, $19, $18, $17, $16, % 2. $15, $14, $13, $12, $11, $1, Source: Bureau of Economic Analysis (Seasonally Adjusted, Chained 212 Dollars ) % %

3 (s) 4, Annual Change in Payroll Jobs US Month-Over-Year 2, Mar = +2.5M -2, -4, -6, -8, Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

4 (s) 7 US Payroll Job Change Month-to-Month Mar = +196k Source: Bureau of Labor Statistics (Seasonally Adjusted), GMU Center for Regional Analysis

5 US Payroll Jobs Month-to-Month Change (s) Total (Millions) M Mar +196K Source: Bureau of Labor Statistics (Seasonally Adjusted), GMU Center for Regional Analysis Since M

6 Ranked by Size in 218 Educ & Health Svcs Prof. & Bus. Svcs State & Local Govt Retail Trade Leisure & Hosp. Manufacturing Financial Construction Wholesale Trade Other Services Transp. & Util. Federal Govt. Information U.S. Payroll Job Change by Sector Mar 218 Mar (s) Source: Bureau of Labor Statistics (Seasonally Adjusted), GMU Center for Regional Analysis 246 Total = 2,537,

7 Ranked by Size in 218 Educ & Health Svcs Prof. & Bus. Svcs State & Local Govt Retail Trade Leisure & Hosp. Manufacturing Financial Construction Wholesale Trade Other Services Transp. & Util. Federal Govt. Information U.S. Payroll Job Change by Sector Feb 219 Mar (s) Total = +196k Source: Bureau of Labor Statistics (Seasonally Adjusted), GMU Center for Regional Analysis

8 U.S. Unemployment Rate % Mar Source: Bureau of Labor Statistics (Seasonally Adjusted), GMU Center for Regional Analysis

9 U.S. Unemployment 15. U-6 UR LFPR Mar 7.3% Mar 3.8% Mar 63% Mar18 to Mar19 U-6 -.6% UR -.2% 6 Source: Bureau of Labor Statistics (Seasonally Adjusted), GMU Center for Regional Analysis

10 (s) Initial Claims for Unemployment 4-Week Moving Average Mar 3: 22K Source: Department of Labor (Seasonally Adjusted), GMU Center for Regional Analysis

11 (s) 5 Initial Claims for Unemployment 4-Week Moving Average Mar 3: 22K Source: Department of Labor (Seasonally Adjusted), GMU Center for Regional Analysis

12 Average Weekly Earnings U.S., Total Private, Across all Industries Average Weekly Earnings 1,2 1, Real Average Weekly Earnings ( dollars) Mar 18 Mar 19 Avg Hourly Wages +3.2% Mar 18 Mar19 Avg Weekly Earnings +3.2% Feb 18 Feb 19 Real Avg Weekly Earnings +1.6% Source: Bureau of Labor Statistics, GMU Center for Regional Analysis

13 Labor Productivity Nonfarm business, seasonally adjusted QOTYC Index Source: Bureau of Labor Statistics, GMU Center for Regional Analysis Base year (1) = 212

14 Consumer Confidence Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Source: The Conference Board, GMU Center for Regional Analysis Current Situation March 219 Cur. = 16.6 Exp. = 99.8 (1985 = 1) Expectations

15 Annual Consumer Prices Source: Bureau of Labor Statistics, GMU Center for Regional Analysis

16 Interest Rates % Yr 1-Yr Treas Fed Source: Federal Reserve Bank of St. Louis, GMU Center for Regional Analysis

17 1-yr./1-yr. yield spread Percentage points Source: FRB Dallas Only false signal '59 '62 '65 '68 '71 '74 '77 '8 '83 '86 '89 '92 '95 '98 '1 '4 '7

18 1-yr./1-yr. yield spread Source: U.S. Treasury, Yield Curve for Treasury Nominal Coupon Issues (TNC yield curve), which is derived from Treasury nominal notes and bonds

19 U.S. New and Existing Home Sales Feb 18 - Feb % Feb 18 - Feb 19.6% 4k (s) 7, 6,5 6, 5,5 5, 4,5 4, 3,5 3, 2,5 2, Existing (Left Axis) New (Right Axis) (s) Source: U.S. Census (New)(Seasonally Adjusted Annual Rate), National Association of Realtors (Existing)

20 Growth in Total Consumption Outlays Source: Bureau of Economic Analysis

21 % 2.6 U.S. GDP (Annual % Change) % Source: Bureau of Economic Analysis, GMU Center for Regional Analysis

22 The Washington Economy

23 Population Change Elements of Population Change Washington MSA 12, +2.% +1.7% +1.5% +1.1% +1.% +1.% +1.1% 1, 8, 6, 23,864 6,843 3,143 37,183 39,715 39,358 41,48 45,41 45,66 44,76 4, 2, 49,16 49,169 47,79 48,651 47,832 44,882 42,616-2, -4, Net Domestic Migration Net Int'l Migration Natural Increase -23,29-31,483-31,492-21, Source: US Census Bureau, Population Estimates Program, V217

24 (s) 15 Annual Job Change MOTYC Washington MSA Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

25 Annual Job Change - Washington MSA s MOTYC Non-Farm Jobs s 11 3, ,3 3,2 3,1 3, 2,9 Feb 18- Feb K Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis 2,8 February-19 Total: 3,29 K

26 (s) 4 Annual Job Change MOTYC District of Columbia Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

27 Annual Job Change District of Columbia s MOTYC Non-Farm Jobs s Feb 18- Feb K February-19 Total: 791 K Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

28 (s) Annual Job Change MOTYC Suburban Maryland Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

29 Annual Job Change Suburban MD s MOTYC Non-Farm Jobs s 3 1, ,2 1, Feb 18- Feb 19-3, Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis 88 February-19 Total: 1, K

30 Annual Job Change MOTYC Northern Virginia (s) Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

31 Annual Job Change Northern VA s MOTYC Non-Farm Jobs s 5 1, ,5 1,45 1,4 1,35 1,3 Feb 18- Feb K Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis 1,25 February - 19 Total: 1,484 K

32 Employment Composition by Sector February 219 Washington MSA Professional & Business Services Education & Health Services Federal Government State & Local Government Leisure & Hospitality Retail Trade Other Services Construction Financial Activites Information Transportation & Utilities Wholesale Trade Manufacturing 2.2% 2.1% 1.9% 1.6% 11.% 1.5% 1.1% 8.% 6.3% 4.7% 4.7% 13.5% 23.3% % 5% 1% 15% 2% 25%

33 (Ranked by Size in 218) Prof. & Bus. Svcs Educ & Health Svcs Federal Govt. State & Local Govt Leisure & Hosp. Retail Trade Other Services Construction Financial Information Transp. & Util. Wholesale Trade Manufacturing Job Change by Sector February 218 February 219 Washington MSA (s) Total = 2, Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

34 (Ranked by Size in 218) Prof. & Bus. Svcs Educ & Health Svcs Federal Govt. State & Local Govt Leisure & Hosp. Retail Trade Other Services Construction Financial Information Transp. & Util. Wlse Trade Manufacturing Job Change by Sector January 219 February 219 Washington MSA (s) Total = 13, Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

35 (s) 25 Professional & Business Services Washington MSA Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis Feb 18- Feb K MOTYC Total Jobs

36 (s) Professional & Business Services Washington MSA Month Over the Year Change Prof., Sci. & Tech. Svcs. Admin. & Waste Mgt Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

37 (s) Federal Government Washington MSA Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis (s) Feb 18- Feb 19-9 MOTYC Total Jobs February-19 Total: 363K

38 $ Billions Federal Procurement in the Washington MSA (Fiscal Years) 82.4 TOTAL = $1,471.1 Billion Source: US Census, Consolidated Federal Funds Report and USAspending.gov

39 (Ranked by Size in 218) Federal Govt. Prof. & Bus. Svcs Educ & Health Svcs Leisure & Hosp. Other Services State & Local Govt Financial Retail Trade Information Construction Transp. & Util. Wholesale Trade Manufacturing Job Change by Sector February 218 February 219 District of Columbia (s) Total 2, Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

40 (Ranked by Size in 218) Federal Govt. Prof. & Bus. Svcs Educ & Health Svcs Leisure & Hosp. Other Services State & Local Govt Financial Retail Trade Information Construction Transp. & Util. Wlse Trade Manufacturing Job Change by Sector January 219 February 219 District of Columbia (s) Total 4, Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

41 (Ranked by Size in 218) Prof. & Bus. Svcs Educ & Health Svcs State & Local Govt Retail Trade Leisure & Hosp. Federal Govt. Construction Other Services Financial Manufacturing Wholesale Trade Transp. & Util. Information -2.7 Job Change by Sector February 21 February 219 Suburban Maryland (s) Total: -3, Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

42 (Ranked by Size in 218) Prof. & Bus. Svcs Educ & Health Svcs State & Local Govt Retail Trade Leisure & Hosp. Federal Govt. Construction Other Services Financial Manufacturing Wholesale_Trade Transp. & Util. Information -2.1 Job Change by Sector January 219 February 219 Suburban Maryland (s) Total: 7, Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis 7.5

43 (Ranked by Size in 218) Prof. & Bus. Svcs Educ & Health Svcs State & Local Govt Leisure & Hosp. Retail Trade Federal Govt. Other Services Financial Construction Transp. & Util. Information Wholesale Trade Manufacturing Job Change by Sector February 218 February 219 Northern Virginia Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis (s) Total 18,

44 (Ranked by Size in 218) Prof. & Bus. Svcs Educ & Health Svcs State & Local Govt Leisure & Hosp. Retail Trade Federal Govt. Other Services Financial Construction Transp. & Util. Information Wholesale Trade Manufacturing Job Change by Sector January 219 February 219 Northern Virginia (s) Total: Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

45 Unemployment Rates in the WMSA By Sub-State Area DC 4. U.S. 4.1 SMD 3.7 MSA 2.8 NVA 2 Source: Bureau of Labor Statistics (Region - Not Seasonally Adjusted, US Seasonally Adjusted)

46 (s) Largest Job Markets Job Change: Feb. 218 Feb. 219 Washington +2, Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis

47 15 Largest Job Markets Job Change: Feb. 218 Feb % 3.% 2.5% 2.% 1.5% 1.%.5%.% -.5% -1.% Washington +.6% 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

48 6. % U.S. GDP and Washington Area GRP (Annual % Change) % U.S. -2. Washington Source: Bureau of Economic Analysis, GMU Center for Regional Analysis. Chained Dollars

49 % % Economic Outlook (GRP), Washington Area and Sub-State Areas (Annual % Change) NV MSA SM DC Source: GMU Center for Regional Analysis, Forecast: April 216

50 Employment Change in the Washington MSA (Thousands of Jobs) Annual Totals Source: BLS, GMU Center for Regional Analysis (March 218) Average Annual Change = 39,8

51 8 7 Employment Change in the Washington MSA (Thousands of Jobs) Dec-Dec Source: BLS, GMU Center for Regional Analysis (March 218)

52 Employment Change in the WMSA by Sub-State Area (s) Annual Totals D.C Sub. MD No. VA REGION Source: BLS, GMU Center for Regional Analysis (March 218) NOTE: The sub-state totals do not include Jefferson, WV. Average Annual Change = 38,9

53 Employment Change in the WMSA by Sub-State Area (s) (Dec Dec) D.C Sub. MD No. VA REGION Source: BLS, GMU Center for Regional Analysis (March 218) NOTE: The sub-state totals do not include Jefferson, WV.

54 Long commutes diminish quality of life Proportion of workers with travel time to work of 6 or more minutes New York SF-Oakland DC Atlanta Boston Chicago Los Angeles Seattle Philadelphia Houston Miami Dallas United States Phoenix Detroit Minneapolis 5.7% 7.3% 7.1% 14.5% 14.2% 14.1% 13.6% 12.3% 11.8% 11.1% 1.6% 9.4% 9.3% 17.9% 17.5% 22.5% % 5% 1% 15% 2% 25% Source: US Census Bureau, 217 American Community Survey, Table S82

55 Annual change in Metrorail Average Weekday Passenger Boardings Metrorail ridership is in decline 15.% 1.% 5.% DC Maryland All Metro Alexandria Arlington Fairfax.% -5.% -1.% -15.% * Source: Washington Metropolitan Area Transit Authority (WMATA)

56 56

57

58

59 The contributions of foreign-born, non-citizen workers to the Washington region s workforce 59

60 Source: 216 American Community Survey, Public Use Microdata Sample (PUMS) files 6

61 Most Foreign Born, Non-Citizens originate from Latin America El Salvador 23.5% India Guatemala Mexico Honduras 6.2% 6.1% 5.8% 5.6% Ethiopia China Bolivia Philippines Canada Bangladesh 3.1% 3.% 2.9% 2.7% 1.%.7% % 5% 1% 15% 2% 25% Proportion of Total Foreign-Born, Non-Citizen Workers Source: US Census Bureau ACS 216, GMU Center for Regional Analysis 61

62 Source: 216 American Community Survey, Public Use Microdata Sample (PUMS) files 62

63 Majority of foreign-born, non-citizen workers have been here 1 years or more 6% 5% Year of Entry, Non Citizen Foreign Born Workers MWCOG Region 48.3% 4% 3% 2% 1% % 22.2% 17.2% 8.4%.2%.5% 1.5% 1.8% before or later Source: US Census Bureau ACS 216, GMU Center for Regional Analysis 63

64 Percentage of Workers Foreign-born, non-citizen workers are about as likely to have a post-secondary degree as all workers nationwide 35% 3% 29.4% Non-Citizen, Foreign-Born Workers Greater Washington Region Workforce 25% 27.4% 25.8% 2% 2.9% 22.7% 15% 16.% 16.2% 16.% 17.5% 1% 5% 8.2% % Less than High School High school diploma/ged Source: US Census Bureau ACS 216, GMU Center for Regional Analysis Associates degree or Some College Bachelors Degree Graduate or Professional Degree 64

65 Several occupational groups rely heavily on foreign-born, non-citizen workers Foreign-Born, Non-Citizen Workers % of Total Occupation Workforce Occupation Group Construction & extraction 65, % Cleaning & maintenence 52, % Farming, fishing, & forestry 1,15 38.% Food preparation & serving 43, % Production 14,22 28.% Healthcare support 1,3 21.6% Personal care & service 21, % Transportation & material moving 22,87 2.7% Life, physical, & social science 1, % Installation, maintenance, & repair 9, % Sales 33, % Computer & mathematical 21,52 1.1% Healthcare practitioners 11,42 8.7% Financial specialists 8,7 8.6% Office & administrative support 27,98 8.6% Source: 216 American Community Survey, Public Use Microdata Sample (PUMS) files 65

66 Housing Market Trends

67 Inventories of Existing Homes Month-Over-Year , MSA % Chg Inv Inventory Feb -4.1% Source: Bright MLS, GMU Center for Regional Analysis. Total monthly inventory includes listings active at the end of the month plus sales during the month.

68 (2.) (4.) (6.) Percent Change in Inventories of Existing Homes Month-Over-Year 2 219, MSA Feb -4.1% Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis. Total monthly inventory includes listings active at the end of the month plus sales during the month.

69 16, 14, 12, 1, 8, 6, 4, 2, Existing Home Sales Washington MSA Through February Month Moving Average ,452 Feb 219 Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

70 2, 1,5 1, , -1,5-2, Existing Home Sales Washington MSA Month-Over-Year Change -399 Feb 219 Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

71 3, Washington MSA Building Permits , 3-Month Moving Avg. 2,5 2, Feb 2,292 1,5 1, 5 Source: Census Bureau, GMU Center for Regional Analysis

72 3, 2,5 2, (s) Inventory and Permits Washington MSA Permits Inventory ,5 2 1, Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

73 8% 6% MOTY Change in Existing Sales and Permits Washington MSA (12 month Moving Average) (s) Permits Existing Home Sales 4% 2% % -2% -4% Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

74 (s) (s) Median House Sales Price Washington MSA $417 K Feb 219 Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

75 Median House Sales Price (s) 7 12 per. Mov. Avg. (Washington MSA) 12 per. Mov. Avg. (Arlington) 12 per. Mov. Avg. (Alexandria City) Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

76 (s) 7 Median House Sales Price Washington MSA Arlington $565K Feb 219 $416 K Feb Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

77 Median House Sales Price ($s) 7 12 per. Mov. Avg. (Arlington) 12 per. Mov. Avg. (Fairfax County) 12 per. Mov. Avg. (Loudoun County) Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

78 Number of Sales ($s) per. Mov. Avg. (Arlington) 12 per. Mov. Avg. (Fairfax County) 12 per. Mov. Avg. (Loudoun County) Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

79 Median Sales Price Percent Change (MOTYC) Washington MSA Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

80 % Average Sales Price Percent Change (MOTYC) Washington MSA Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis Feb. = $467K

81 % Average Sales Price Percent Change (MOTYC) District of Columbia Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis Feb. = $692K

82 Average Sales Price Percent Change (MOTYC) Suburban Maryland % Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis Feb. = $381K

83 Average Sales Price Percent Change (MOTYC) Northern Virginia % Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis Feb. = $485K

84 Total Listings Per Sale Sep Each Year PW PG ARL MONT FFX LDN DC Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

85 Total Active Listings Per Sale February Each Year Metro Area Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

86 Average Home Sales Price Northern VA - Single Family Detached (%) MOTY Change 12 per. Mov. Avg. ($ Sales) (s) 2 $ $7 $6 $5 $4 $3 $2 $1-5 $ February 219 = $644,988, +4.3% Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis

87 Average Home Sales Price Northern VA - Single Family Attached (%) MOTY Change 12 per. Mov. Avg. ($ Sales) (s) 3 $ $5 $4 $3 $2 $1-5 $ Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis February 219 = $472,56, +5.1%

88 Average Home Sales Price Northern VA - Condos (%) MOTY Change 12 per. Mov. Avg. ($ Sales) (s) 25 $ $35 $3 $25 $2 $15 $1 $5-1 $ Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis February 219 = $327,779,.7%

89 Average Home Sales Price DC- Single Family Detached (%) MOTY Change 12 per. Mov. Avg. ($ Sales) (s) 6 $1,4 5 $1,2 4 3 $1, 2 $8 1 $6 $ $2-3 $ Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis February 219 = $956,117, -19.3%

90 Average Home Sales Price DC- Single Family Attached (%) MOTY Change 12 per. Mov. Avg. ($ Sales) (s) 4 $1, 3 $9 $8 2 $7 1 $6 $5 $4-1 $3 $2-2 $1-3 $ Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis February 219 = $78,811, +16.2%

91 (%) MOTY Change 12 per. Mov. Avg. ($ Sales) (s) 3 $ Average Home Sales Price DC- Condos Source: Metropolitan Regional Information Systems (MRIS), GMU Center for Regional Analysis February 219 = $512,695, -2.9% $6 $5 $4 $3 $2 $1 $

92 Where are we? We are growing: Some diversification Some catch-up Recent job growth across all wage levels Growth will continue in 217, but at a moderating pace Advantages Government Center International Institutions Connectivity to the World Concentration of Leaders Access to capital High Quality-of-Life Diverse Population Higher Education Educated Work Force Advanced Occupational Specializations Challenges Drain the swamp/sequester Further market shifts needed Cost of living/doing business Mobility Access to capital Regional branding / cooperation Globally competitive? Understanding changing nature of jobs Productivity

93 Thank You Questions cra.gmu.edu

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