>In Which I Examine Unemployment in the Washington Area

>It’s often been argued that the Washington DC area has several features which make it exceptional when it comes to unemployment. I examine some of the statistics. Originally posted here.

Unemployment: Washington metro region vs. the nation

By: Jeremy Skog
Special to The Examiner
06/09/10 6:40 AM EDT

Businesses and investors undoubtedly spent much of the past few days mulling over the unemployment numbers released last week. It was certainly picked up on the political beat and stocks sank, only recently recovering slightly. But there’s always been a meme that the greater Washington area is more stable than other areas of the country, due to its reliance on the Federal Government and industries employing highly-educated workers, both groups which are traditionally less affected by job-market downturns.

This was borne out last Wednesday, June 2nd when the Bureau of Labor Statistics also released their estimates of local employment and unemployment up to April, 2010. In contrast to a country-wide average of 9.7%, the regional unemployment rate is only 5.9%. This is mostly due to the suburbs – within the city itself the rate is reported at 9.8%. This is worse than last year for all of the areas in greater Washington. Last April, DC’s unemployment rate stood at 8.5%, Maryland at 5% and Virginia at 5.1%.

It’s easy to let this gloom overwhelm, but our area may be the one-eyed man in the land of the blind. It is the only metropolitan area in the country to see an increase in the number of employees on payroll over the last year, by 0.2% in the area and 1.5% in the District itself. This increase in jobs, however, wasn’t large enough to counteract the overall increase in the size of the labor force, which increased by about 5,500 people in the entire area. Maryland saw a drop in the size of its labor force by about 3,700 people while the District gained almost 8,000. Virginia held steady, adding 1,200 people to the labor force. (These numbers may not add up exactly due to rounding in the reported statistics.)

This report was especially criticized because 411,000 of the jobs created nationally were temporary positions with the 2010 Census. Each of the 12 national census regions hires approximately 40,000 to 70,000 of these temporary workers. Depending on local laws, they may be eligible for unemployment benefits after their work ends.

Squeezed budgets have led to headline-grabbing cuts in local services, but it is true that the Washington region does have several unique advantages. One is its reliance on government which helps to smooth out booms and busts like an ocean does temperatures. The unemployment rate for government workers was only 3.4% in May. Another beneficial factor is the regions incredibly highly-educated workforce. DC has a national-high 47.5% of residents over age 25 with a bachelors degree or higher. 26% possess an advanced degree. Maryland and Virginia also rank well on these metrics – 35% of Marylanders over age 25 have at least a Bachelors degree as do a third of over-25 Virginians. This has a real effect on the workforce. Those with higher levels of education are both more likely to participate in the workforce and less likely to be unemployed. The national unemployment rate in May for those with at least a Bachelors degree was only 4.7% versus 15% for those without a High School diploma. This difference holds, even accounting for the fact that 77.3% of those with a College degree were in the labor force versus only 45.8% of those who didn’t graduate High School. The general effect is a feeling of relative prosperity as more people in our area consider themselves eligible for work and more of them are employed.

These regional aspects can lead to an unfortunate myopia among policymakers – it can be hard to see a problem until one is personally affected. Most Americans currently list the economy as the most pressing issue facing our nation and the recent job numbers mean this will likely continue as graduates enter the labor force this summer. Given Washington’s often insularity and the climate of anti-incumbent sentiment around the country it’s ever more important for representatives to venture beyond the beltway and meet with their constituents to determine their upcoming legislative priorities and responsibilities.

This same local bubble can make the situation seem even more bleak for anyone job-hunting right now, especially they don’t possess any of the aforementioned advantages. It can be difficult to see one’s peers busily productive and though there is lots of advice available to job-seekers the traditional tip is still the best: stay busy and don’t give up. Local residents shouldn’t be too discouraged by national news – the greater Washington area remains one of the best places in the country to seek employment.

The next release of Regional and State Employment and Unemployment news is scheduled for Friday, June 18th at 10:00 am.

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