Nice to know jobs are being created somewhere! <g>
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Area's Economy Continues Its Strong Surge
By Neil Irwin
Washington Post Staff Writer
Thursday, June 3, 2004; Page E01
A construction boom and soaring government spending drove the Washington area economy ahead again in April, as the region generated thousands of new jobs and unemployment dipped.
According to Labor Department data released yesterday, the region's April unemployment rate was the nation's lowest among major metropolitan areas: 2.8 percent, down from 3 percent in March and 3.4 percent in April 2003. The Washington area also added more jobs than any other metro area: 77,300 in the year ended in April, the fastest growth in the past 15 years except for the extraordinary boom years of 1999 and 2000. The strongest job growth came in the construction, retail, and business and professional services sectors.
Job growth is nothing new for the Washington area, which generally kept adding positions, albeit in small numbers, through the economic slump of 2001 and 2002. But local companies now appear to be expanding robustly.
"The numbers keep going up and up and up," said Steven Cochrane, chief regional economist of consulting firm Economy.com.
The biggest drivers of the expansion, economists said, continue to be a strong housing market, which explains most of the 11,000 construction jobs added in the past year, and growing federal government spending, much of which trickles to the business and professional services firms that added 27,900 jobs in the 12 months ended in April.
But there are signs that companies in more industries are beginning to hire in substantial numbers. For example, wholesale trade, a sector that had been cutting positions, added 2,500 jobs in the year ended in April. And while the long-troubled telecommunications and manufacturing sectors still have fewer jobs than they had a year ago, they are bleeding less profusely.
"It's not just the government and government contractors that are growing at this point," said Mark P. Vitner, senior economist at Wachovia Corp. "It's virtually every part of the private sector seeing some gain."
That could be crucial for the local economy's long-term outlook. Eventually, the federal government may attempt to trim the deficit, which could come at the expense of procurement spending that helps keep the Washington area afloat; about half of economic activity in the region is tied to the federal government. Meanwhile mortgage rates are on the rise, and some economists think the housing market has seen its peak, which could slow construction and other hiring tied to real estate.
If one or both of those things happen, it would be up to other major local industries, such as finance, technology and tourism, to pick up the slack.
"At the moment, it's still not a very balanced economy," said Cochrane, arguing that job growth in Washington is still highly concentrated in fields supported by government spending and low interest rates.
But whatever the future holds, at present the Washington area is in a jobless recovery no more. The region had 2.8 percent more jobs in April than a year earlier; nationally, jobs were added at a 0.8 percent rate. And the 82,300 local residents who were unemployed in April is the lowest number since May 2001. There were 96,800 jobless in the region in April 2003.
Jim Buckmaster, chief executive of the Web site Craigslist, which publishes about 80,000 help-wanted ads online each month, said that its volume of job postings in the Washington area was up 400 percent in May, compared with May 2003. That's tied with San Diego for the strongest help-wanted growth among the large cities for which Craigslist operates sites.
"Washington has significantly outpaced other cities," said Buckmaster, on the strength of particularly strong growth in demand for retail, marketing and technology workers.
Geographically, the jobs in the Washington area are being added in all parts of the region, with the sharpest gains in Northern Virginia. In the year ended in April, Northern Virginia added 48,400 jobs. Suburban Maryland added 14,700 jobs. The District added 5,300.
© 2004 The Washington Post Company |
