1. Economic and Workforce Challenges in Central VA
Background Information for Discussion

2. Purpose
Provide a better understanding of macro & regional economic factors.
The positives and negatives
Employment dynamics
Who’s most affected by the changes
Identify underlying issues
Recommendations & discussion

3. The Macroeconomic Picture

4. Foreclosures have probably not peaked, meaning a continued oversupply of housing stock.

5. Demand is down despite record low interest rates.

6. The overall demand picture remains weak nearly 5 years into the housing depression.

7. The supply/demand dynamics will lead to higher inventories and further price declines.

8. The connection between housing and employment is very strong
The connection between housing and employment is very strong. Without a rebound, employment will lag.

9. The rebound in manufacturing has been stronger, but subdued compared to other recessions.

10. Manufacturing employment may actually grow with a favorable exchange rate, but the sector is still underutilized.

11. Growth in services has rebounded somewhat, but employment gains have been tepid.

13. Job Leaders / Losers, Q4 2007-Q1 2010
Industry
EMP
WAGE
CHANGE
ALB VA US
Agriculture, Forestry, Fishing and Hunting
440
$25,099 9
1.1%
-3.2%
-1.0%
Mining, Quarrying, oil and Gas Extraction nd
-4.1%
-1.4%
Utilities
1.0%
0.7%
Construction
2,600
$39,453
-888
-13.7%
-11.2%
-11.0%
Manufacturing
2,575
$61,540
-514
-8.7%
-7.5%
-7.6%
Wholesale Trade
588
$53,177
-68
-5.4%
-3.6%
Retail Trade
5,375
$26,497
-570
-4.9%
-3.1%
Transportation and Warehousing
636
$37,572
-179
-11.7%
-3.8%
-3.4%
Information
606
$54,524
-59
-4.5%
-5.9%
-3.5%
Finance and Insurance
915
$70,008 85
5.0%
Real Estate and Rental and Leasing
704
$39,561
-33
-2.3%
-4.3%
Professional, Sci, and Tech Services
3,052
$57,326
179
3.1%
2.0%
Mgt of Companies and Enterprises
1,551
$52,774 26
0.8%
-1.6%
0.4%
Admin, support, Waste Mgt
1,746
$29,069
-394
-9.7%
Educational Services
14,584
$52,521
197
1.2%
Health Care and Social Assistance
4,927
$53,238
145
1.5%
3.0%
2.3%
Arts, Entertainment, and Recreation
1,315
$21,552
-40
-1.5%
-0.6%
-0.5%
Accommodation and Food Services
3,304
$15,950
-115
-1.7%
-1.1%
-1.3%
Other Services (except Public Admin)
1,415
$48,348
127
4.8%
-0.8%
Public Administration
1,608
$63,210 89
2.9%
2.5%
Total All Industries
47,983
$45,522
-2,034
-2.1%
-2.5%

18. Government Debt as a Percent of GDP

19. Employment Dynamics

20. Positive Attributes and Workforce Opportunities

21. Unemployment, 1990-Present (VEC)
Local, regional unemployment consistently tracks lower than state and national averages.

22. Wage Growth, 1990-Present (QCEW)
93.9%
Average wage growth in the county has been consistently strong.
100.3%

23. Greater Charlottesville Employment by Size of Establishment
Large / public sector employers are the county / region’s firewall against more severe downturns.
39% of Albemarle County’s Wages Come from the Public Sector
35% of the MSA’s Wages Come from the Public Sector
19% of the Commonwealth’s Wages Come from the Public Sector

24. Greater Charlottesville Economic and Workforce Challenges
Downside Risks:
Greater Charlottesville Economic
and Workforce Challenges

25. Albemarle Unemployment, 1990-Present (VEC)
Labor force participation and employment have broken under their 12 month moving averages. Rates go down, but not because of employment growth.

26. Private Sector Wage Growth, 1990-Present (VEC)
85.9%
91.0%
Private sector wage growth is eroding when compared to the rest of VA.
88.6%

27. Labor Supply and Demand
(2008 QCEW, 2000 Census)
Albemarle
MSA VA
Labor Demand
Low Skill
36.5%
37.9%
40.2%
Medium Skill
28.6%
30.0%
30.7%
High Skill
34.9%
32.1%
29.1%
Labor Supply
26.9%
30.8%
38.0%
20.3%
27.5%
29.0%
52.8%
41.6%
33.1%
Underemployed
-9.6%
-7.1%
-2.3%
-8.2%
-2.5%
-1.7%
17.9%
9.6%
4.0%
Albemarle leads the ‘mismatch’

28. WIA 6 Commuting to Work (2000 Census)
Commuting Workforce
WIA 6 Commuting to Work (2000 Census)
(~ 22,200)
Out commuters are one indicator of competing economic opportunities in different workforce areas.
NOVA
(~ 1,900)
(~ 2,800)
VAL FB
RIC
(~ 1,100)
(~ 4,700)
LYN

29. Greater Charlottesville Business Clusters
Professional
Information Technology
Finance
Insurance
Prof & Tech Services
Mgt of Co. & Enterprises
Skilled Trades
Agriculture
Mining
Utilities
Construction
Manufacturing
Wholesale & Trans.
White Collar Service
Real Estate
Educational Services
Health Care
Social Assistance
Public Administration
Industry cluster types coalesce around wage and education levels.
Blue Collar Service
Retail
Administration
Arts, Entertainment & Rec
Accommodation
Food Service
Other Services

30. Greater Charlottesville Employment Growth by Cluster Q1 1990 – Q1 2010
(US Department of Labor, Quarterly Census of Employment & Wages)
$1,241
$883
Employment growth has been steady until the recession.
$995
$435

31. Greater Charlottesville Employment Growth by Cluster Q1 1990 – Q1 2010
(US Department of Labor, Quarterly Census of Employment & Wages)
But the growth has been uneven.
(L14 – 16) $883
(L8 - 12) $435
(12 – 14) $955
(L14 – 20) $1,241

32. Greater Charlottesville Business Clusters
(US Department of Labor Quarterly Census of Employment & Wages)
Low wage service jobs comprise almost 1/3 of the employment share, unchanged since 1990.
1990
Jobs, comprised mostly of public sector employees are taking a larger share of the regional economy.
Skilled trades employment has declined by almost 30% since 1990.
2010

33. Observations
The public sector and hospitality industry are driving employment growth in the Charlottesville MSA.
There are several downside risks to this pattern:
Economy demands higher education for the same pay.
Lack of diversity in job opportunities may be contributing to a permanent underclass and a permanent commuting class.
Population growth is not balanced by revenue growth.

34. Greater Charlottesville Employment Growth by Cluster Q1 1990 – Q4 2009
(US Department of Labor, Quarterly Census of Employment & Wages)
(L14 – 16) $999
(L8 - 12) $474
(12 – 14) $1,012
(L14 – 20) $1,405

35. Greater Charlottesville Housing
Sales and Median Prices, (CAAR)

36. Issues & Challenges
The regional economy may continue to grow in a way that causes several challenges:
More residents may not necessarily mean more tax paying employers.
Property tax revenues (70-75% of most budgets) will be under strain because of declining residential assessments (75-90% of property tax revenues).
Education funding will likely be the biggest challenge as a result.

37. Looking Forward

38. Workforce Area 6 Projected Employment Growth by Industry, 2010-2020
WAGE ‘10
EMP ‘10
GAIN ‘20
Educational Services
$45,419
25,208
6,427
Health Care and Social Assistance
$44,942
22,856
6,163
Retail Trade
$24,780
17,201
1,293
Accommodation and Food Services
$15,562
13,811
1,444
Construction
$39,806
10,309
2,248
Professional, Scientific, and Technical Services
$60,039
8,876
3,300
Manufacturing
$49,676
7,954
-384
Public Administration
$45,401
7,031
1,016
Other Services (except Public Administration)
$35,752
5,151
854
Admin, Support and Waste Mgt
$29,235
4,883
994
Transportation and Warehousing
$47,624
3,705
317
Wholesale Trade
$49,222
3,337
252
Information
$63,393
3,102
199
Finance and Insurance
$75,916
2,991
304
Arts, Entertainment, and Recreation
$22,618
2,976
583
Management of Companies and Enterprises
$57,644
2,225
193
Real Estate and Rental and Leasing
$36,508
2,045
292
Agriculture, Forestry, Fishing and Hunting
$27,503
2,029 33
Utilities
$85,698
1,706
-153
Mining, Quarrying, and Oil and Gas Extraction
$47,683
218 1

39. Workforce Area 6 Projected Employment Growth by Occupation, 2010-2020
Title
EMP
WAGE
PWN VA US
GAIN
Office and Administrative Support
23,645
$33,000
0.8%
-0.1%
3,421
Education, Training, and Library
15,400
$51,100
1.9%
1.8%
1.2%
2,886
Healthcare Practitioners and Technical
9,702
$67,900
2.6%
2.1%
1.7%
2,521
Food Preparation and Serving Related
13,485
$20,900
1.1%
0.9%
1,972
Sales and Related
13,655
$33,600
-0.6%
-0.7%
-0.5%
1,600
Business and Financial Operations
6,100
$60,900
0.3%
1,581
Healthcare Support
4,691
$26,800
2.9%
3.0%
2.2%
1,562
Construction and Extraction
7,597
$39,400
-4.4%
-3.9%
-2.4%
1,533
Personal Care and Service
4,090
$25,100
2.8%
1,217
Computer and Mathematical
3,611
$71,500
2.7%
2.4%
1.4%
1,153
Management
7,216
$99,900
0.2%
0.1%
940
Installation, Maintenance, and Repair
5,193
$42,200
-0.8%
-1.6%
769
Building and Grounds Cleaning and Maintenance
5,441
$23,700
0.5%
0.7%
701
Transportation and Material Moving
7,635
$28,400
-1.1%
700
Community and Social Services
2,309
$44,700
2.3%
3.9%
563
Protective Service
3,191
$43,900
1.3%
534
Life, Physical, and Social Science
1,727
$57,400
479
Arts, Design, Entertainment, Sports, and Media
2,173
$50,300
-0.4%
383
Architecture and Engineering
2,237
$69,500
0.0%
-0.2%
363
Production
6,213
$32,900
-2.9%
-3.4%
263
Legal
872
$81,700
0.4%
185
Farming, Fishing, and Forestry
1,426
$26,200
-2.3%
-1.9%
-0.3% 27

40. Workforce Area 6 Age by Industry, 2009

41. Educational Challenges/Opportunities from an EcoDev Perspective
Funding constraints will continue.
More students in education, health, IT career paths to work in the Central VA region.
Pay attention to the retiree wave that could affect both the region’s and department’s workforce.
Have flexibility to adjust as conditions change. (DIA, Other ‘game changing’ employment sectors)
Work with EcDev on career paths for targets, emerging industries.

42. Overall EcoDev Recommendations
Our economic program should have 3 main goals:
Reduce the number and percentage of our residents who commute out of the region for work.
Reduce the number and percentage of our working poor.
Expand and diversify the local employment / tax base.

43. TJPED Recommendations
Strategically grow and attract capital intensive, private sector employers that provide career ladder job opportunities for our resident workforce.
Actions that can help us achieve our goals:
Determine business targets
Create a favorable climate
Cultivate & grow local businesses
Strategically attract new investment
5. Develop the right workforce