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12/5/2019

1

December 5, 2019

Washington Area Economy: Performance and Outlook

Keith Waters, Ph.D.Center for Regional Analysis

Schar School of Policy and GovernmentGeorge Mason University

The National Economy

U. S. Gross Domestic Product

Source: Bureau of Economic Analysis (Seasonally Adjusted, Chained 2012 Dollars )

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

$10,000

$11,000

$12,000

$13,000

$14,000

$15,000

$16,000

$17,000

$18,000

$19,000

$20,000

-2.0

-1.0

0.0

1.0

2.0

3.0

4.0

5.0

6.0

Quarterly Change Real GDP (Billions)

%

Q3 2018-Q3 2019 +1.9%

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125,000

130,000

135,000

140,000

145,000

150,000

155,000

160,000

165,000

0

50

100

150

200

250

300

350

400

2013 2014 2015 2016 2017 2018 2019

1-mo. change (in thousands)

total payroll jobs(in millions)

U.S. Payroll Jobs

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

Since 2010(Jan 2010)

+22.1M

Since 2018(12-mo. ∆)

+2.09M

Sep-Oct 2019

(1 mo. ∆)+128k

U.S. Payroll Job Change by Sector12-Month Net Change (Oct 2019)

-4

-17

10

-3

11

10

16

-36

61

6

14

22

39

-60.0 -40.0 -20.0 0.0 20.0 40.0 60.0 80.0

Information

Federal Govt.

Transp. & Util.

Other Services

Wholesale Trade

Construction

Financial

Manufacturing

Leisure & Hosp.

Retail Trade

State & Local Govt

Prof. & Bus. Svcs

Educ & Health Svcs

total = +129k


Ranked by Size in 2018 (000s)

0.0

2.0

4.0

6.0

8.0

10.0

12.0

2014 2015 2016 2017 2018 2019

U. S. Unemployment

October7.0%

U-6

UR

LFPR

October3.6%

October63.3%


62.25

62.50

62.75

63.00

63.25

63.50

2014 2015 2016 2017 2018 2019

Oct 2018-Oct 2019(12-mo.)change:

U-6 -0.5%UR -0.2%

LFPR +0.4%

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3

300

400

500

600

700

800

900

1,000

2011 2012 2013 2014 2015 2016 2017 2018 2019

Average Weekly Earnings Real Average Weekly Earnings (1982-1984 Dollars)

Oct 2018-Oct 2019% change(MOTYC)

Avg HourlyWages

+3.03%

Avg WeeklyEarnings+2.74%

Real AvgWeekly

Earnings+0.95%

Source: Bureau of Labor Statistics, GMU Center for Regional Analysis

Average Weekly EarningsU. S., Total Private, Across all Industries

40.0

60.0

80.0

100.0

120.0

140.0

160.0

180.0

Consumer Confidence

Source: The Conference Board, GMU Center for Regional Analysis

Expectations Index

Present Situation Index

Nov 2019Pres. = 166.9Exp. = 97.9

(1985 = 100)

350

400

450

500

550

600

650

700

750

800

3,500

4,000

4,500

5,000

5,500

6,000

6,500

7,000

7,500

8,000

2013 2014 2015 2016 2017 2018 2019

Existing Home Sales

New Home Sales

U. S. Home SalesNew and Existing (2013-Present)

(000s)

Source: U.S. Census (New Home Sales) [Seasonally Adjusted Annual Rate], National Association of Realtors (Existing Home Sales)

(000s)

Existing Home Sales12-month change

Oct 18 – Oct 19+4.60%

New Home Sales12-month change

Oct 18 – Oct 19+31.6%

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The Washington Economy

Annual Job ChangeWashington MSA (2012-2019)

2,900

2,950

3,000

3,050

3,100

3,150

3,200

3,250

3,300

3,350

3,400

-10

0

10

20

30

40

50

60

70

80

2012 2013 2014 2015 2016 2017 2018 2019

12-month net change total employees

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

thousands thousands

Oct 2019Total: 3.37M

Oct 18-Oct 19+52.3k

Employment Composition by SectorWashington MSA October 2019

1.7%

1.8%

2.1%

2.2%

4.7%

4.9%

6.2%

8.0%

10.2%

10.5%

10.8%

13.5%

23.4%

0% 5% 10% 15% 20% 25%

Manufacturing

Wholesale Trade

Transportation & Utilities

Information

Financial Activites

Construction

Other Services

Retail Trade

State & Local Government

Leisure & Hospitality

Federal Government

Education & Health Services

Professional & Business Services

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Job Change by SectorWashington MSA

Oct 2018 – Oct 2019(000s) Total = +52,300


0.6

-1.1

2.5

0.4

0.5

2.7

0.9

-4.5

17.2

2.5

-0.5

9.9

21.2

-10.0 -5.0 0.0 5.0 10.0 15.0 20.0 25.0

Manufacturing

Wholesale Trade

Transport/Utilities

Information

Financial

Construction

Other Services

Retail Trade

Leisure & Hosp.

State & Local Govt

Federal Govt

Educ & Health Svcs

Prof/Business Svcs

(Ranked by Size in 2018)

Federal GovernmentWashington MSA

Oct 2018 – Oct 2019

Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional AnalysisOct 2019 total: 363.1k

(000s) (000s)

345

350

355

360

365

370

375

380

385

390

-20

-15

-10

-5

0

5

10

15

20

25

30

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

MOTYC

Total Jobs

Oct 2018-Oct 2019

-0.5k

Federal Spending in the Washington MSAFiscal Years 1980-2019

4.2 5.0 5.8 6.7 7.7 9.0 10

.7

11

.4

11

.5

11

.9

12

.6

14

.6

15

.6

16

.1

17

.9

19

.4

20

.8

21

.7

24

.8

27

.7

29

.3

32

.1 37

.1 44

.0

52

.6

54

.5

57

.1

59

.1

67

.9

75

.8 80

.0

78

.0

76

.0

70

.6

73

.1

74

.0 78

.5 83

.5 88

.7

82

.6

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

100.0

| FY80-89 = $83.9B |

| FY00-09 = $509.5B |

| FY90-99 = $191.2B |

($ Billions)

Total = $1,569.3 Billion

Source: USAspending.gov

| FY10-19 = $784.7B |

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-15.0

-10.0

-5.0

0.0

5.0

10.0

15.0

20.0

25.0

2013 2014 2015 2016 2017 2018 2019

640

660

680

700

720

740

760

780

800

MOTYC

Total Jobs

Oct 18-Oct 19+21.2k

Professional & Business ServicesWashington MSA

(000s)


(000s)

600.0

620.0

640.0

660.0

680.0

700.0

720.0

740.0

760.0

780.0

800.0

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

-15.0

-10.0

-5.0

0.0

5.0

10.0

15.0

20.0

25.0Professional, Science & Tech MOTYC Admin Support & Waste Mgmt MOTYC Professional & Business Services Employees (total)


Professional & Business ServicesWashington MSA

(000s) (000s)

660

680

700

720

740

760

780

800

820

-5

0

5

10

15

20

25

2012 2013 2014 2015 2016 2017 2018 2019



Annual Job ChangeDistrict of Columbia (2012-2019)

thousands thousands

Oct 18-Oct 19+7.7k

Oct 2019Total: 805.3K

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Job Change by SectorDistrict of Columbia

Oct 2018 – Oct 2019

0.0

-0.4

0.2

0.3

1.0

-0.7

0.6

-0.3

1.2

1.3

1.0

4.2

-0.7

-2.0 -1.0 0.0 1.0 2.0 3.0 4.0 5.0

Manufacturing

Wholesale Trade

Transp. & Util.

Construction

Information

Retail Trade

Financial

State & Local Govt

Other Services

Leisure & Hosp.

Educ & Health Svcs

Prof. & Bus. Svcs

Federal Govt.

(000s) Total +7,700k



880

900

920

940

960

980

1,000

1,020

1,040

-10

-5

0

5

10

15

20

25

30

2012 2013 2014 2015 2016 2017 2018 2019



Annual Job ChangeSuburban Maryland (2012-2019)

thousands thousands

Oct 2019Total: 1.02M

Oct 18-Oct 19+8.3k

Job Change by SectorSuburban Maryland

Oct 2018 – Oct 2019

-0.3

1.0

0.2

0.2

-1.0

0.5

0.2

-0.5

1.2

-1.6

4.2

2.6

1.6

-2.0 -1.0 0.0 1.0 2.0 3.0 4.0 5.0

Information

Transp. & Util.

Wholesale Trade

Manufacturing

Financial

Other Services

Construction

Federal Govt.

Leisure & Hosp.

Retail Trade

State & Local Govt

Educ & Health Svcs

Prof. & Bus. Svcs

(000s) Total: +8,300



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1,250

1,300

1,350

1,400

1,450

1,500

1,550

-10.0

0.0

10.0

20.0

30.0

40.0

50.0

2012 2013 2014 2015 2016 2017 2018 2019



Annual Job ChangeNorthern Virginia (2012-2019)

thousands thousands

Oct 18-Oct 19+26.7k

Oct 2019Total: 1.5M

Job Change by SectorNorthern Virginia

Oct 2018 – Oct 2019

0.6

-1.1

-1.3

0.1

1.1

2.5

0.6

-0.2

-1.5

8.0

3.5

1.7

12.7

-3.0 -1.0 1.0 3.0 5.0 7.0 9.0 11.0 13.0 15.0

Manufacturing

Wholesale Trade

Information

Transp. & Util.

Construction

Financial

Other Services

Federal Govt.

Retail Trade

Leisure & Hosp.

State & Local Govt

Educ & Health Svcs

Prof. & Bus. Svcs

(000s) Total +26,700



2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

10.0

11.0

Oct 2009 Oct 2010 Oct 2011 Oct 2012 Oct 2013 Oct 2014 Oct 2015 Oct 2016 Oct 2017 Oct 2018 Oct 2019

Oct 2019DC 5.3US 3.6SMD 3.1MSA 2.8NVA 2.0

Unemployment Rates in the WMSABy Sub-State Area

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

%

12/5/2019

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15 Largest Job Markets Job ChangeOct 2018 – Oct 2019

-20

0

20

40

60

80

100

120(000s)

Washington +52,300


•Mixed signals•Global slowdown, Brexit, Germany teetering on recession

•Trade wars: China, Now France (EU)

•Corporate earnings still good

•Wages finally reflecting tight labor markets

•Consumer confidence softening but good

Outlook/Discussion for 2020

•Fed rates: ??? If we see weakness, 2 rate cuts

•US GDP growth 1.9-2.1% depending on admin actions in summer (election year)

•Wage gains soften, inflation barely moving (energy stable)

•Equity markets (volatility, some gain, China trade deal) (hype, hype, hype).

•DC Area Employment +20k•Tight labor markets slowing potential job growth

Outlook/Discussion for 2020

12/5/2019

10

Thank You

cra.gmu.edu

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