Northern Virginia leaders assess economic outlook and job market risks for Arlington

The Arlington County Board Work Session held on May 19, 2025, focused on the region's economic outlook and the challenges facing local businesses. Officials discussed the importance of collaboration in economic development, emphasizing a regional approach with Northern Virginia partners to address ongoing issues.

Key insights were drawn from the University of Virginia's Weldon Cooper Center, which reported a weakening labor market. Projections indicate a potential loss of 32,000 jobs statewide in 2025, alongside modest GDP growth of only 0.4%. This economic slowdown is attributed to national and global factors, creating a climate of uncertainty for businesses.

A survey conducted by the Northern Virginia Chamber revealed a pessimistic sentiment among local executives, with 59% anticipating a decline in the regional economy. Notably, one in five respondents indicated plans for layoffs, with federal budget cuts cited as a significant concern.

In Arlington specifically, unemployment has risen to 3.2%, a 60% increase from the previous year, with over 1,000 residents filing for unemployment benefits. However, officials acknowledged that these figures may not fully capture the reality, as many individuals have opted for federal buyout packages, delaying their exit from the workforce.

The meeting highlighted the risks associated with the local economy, particularly concerning the 87,000 federal and contractor jobs in Arlington, which are vulnerable due to the ongoing uncertainties in federal employment and contracting.

Overall, the discussions underscored the need for strategic planning and support from state leadership to navigate the challenging economic landscape ahead.