Gaithersburg leaders and COG warn federal downsizing is already denting the local economy; new regional job platform gains users

Gaithersburg Mayor (Jim) and the City Council on Oct. 27 heard a briefing from Clark Mercer, executive director of the Metropolitan Washington Council of Governments, and Sharon Disk, Gaithersburg’s economic development manager, who said federal workforce reductions and agency relocations are already affecting the regional and local economy.

“The challenge of federal downsizing is really, a regional issue that mandates a regional solution,” Disk said during the work session. Mercer described COG’s convening role across Maryland, Virginia and the District and warned the region must act together to limit economic damage.

Why it matters: A large share of the area’s payroll and related spending flows from federal employment and contractors. Mercer cited multiple federal-employment measures and said that, depending on the dataset, about 302,000 federal employees live in Maryland and roughly 330,000 live in Virginia. At the local level, Disk said Gaithersburg lost 978 jobs when comparing August 2025 with August 2024 and that the city’s unemployment rate rose from 3% to 4% over the same period.

COG’s evidence and regional response: Mercer outlined three groups affected by federal changes:…