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Q: What drives D.C.'s economy? ( Answered 5 out of 5 stars,   0 Comments )
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Subject: What drives D.C.'s economy?
Category: Business and Money > Economics
Asked by: shikibobo-ga
List Price: $10.00
Posted: 10 May 2004 05:34 PDT
Expires: 09 Jun 2004 05:34 PDT
Question ID: 343973
What drives Washington DC's economy? (Obviously government, but make
the case. How cyclical is the local economy? How predictable?)
Answer  
Subject: Re: What drives D.C.'s economy?
Answered By: googlenut-ga on 11 May 2004 22:39 PDT
Rated:5 out of 5 stars
 
Hello shikibobo-ga,

As you have said, the Washington, D.C. economy is obviously driven by
the Federal Government, which is by far, the largest employer with
nearly one third of D.C.'s total employment.  Other than the
government, D.C.?s top employers are universities and hospitals, which
account for nine of the 10 largest private sector employers.

Although there is a seasonal effect due to the education sector,
D.C.?s economy is apparently not very cyclical.  This is due largely
to the consistent spending of the federal government, which fuels the
private sector.



References:


DC Marketing Center
Key Business Statistics
http://www.dcmarketingcenter.com/key.asp.13.html?PHPSESSID=d436dcffe4ac69a7705aca9546daea38
?Total Employment (Nov 2003): 670,300 
Federal Government Employment (Nov 2003): 189,500 
Taxable Retail Sales (2002): $7.5 billion 

Major Employers in Private Sector (Oct 2002)
1. George Washington University
2. Howard University
3. Washington Hospital Center
4. Georgetown University
5. Georgetown University Hospital
6. Children's National Medical Center
7. Fannie Mae
8. Howard University Hospital
9. American University
10. Washington Post Newspaper 

Employment by Industry (Nov 2003): 
Government 226,800 
Professional & Business Services 143,800 
Educational & Health Services 94,300 
Other Services 55,500 
Leisure & Hospitality 50,100 
Financial Activities 31,000 
Trade, Transportation & Utilities 27,900 
Information 25,400 
Natural Resources, Mining & Construction 12,700 
Manufacturing 2,800?



District Columbia Department of Employment Services
Chief Executive Officers
Top 200 of the Major Employers in the District of Columbia
http://does.dc.gov/does/frames.asp?doc=/does/lib/does/info/Top_200r.pdf
?Education and healthcare top the list. Universities and hospitals are
nine of the 10 largest private sector employers and account for 70
percent of the jobs in the Top 20.?



District Columbia Department of Employment Services
Labor Market Trends
Metropolitan Washington, DC
http://does.dc.gov/does/frames.asp?doc=/does/lib/does/pdf/feb_newsletter_04-14.pdf
?District of Columbia Job Growth The District?s February 2004 wage and
salary jobs increased by 4,400 due to an increase in the private
sector, which gained 4,700, partially offset by a 300 job loss in the
public sector. The employment gain is due primarily to a 3,400
increase in educational and health services resulting from a 3,300
seasonal increase in educational services. Professional and business
services gained 900 jobs with 700 more jobs in legal services; leisure
and hospitality gained 400 jobs and other services added 200 jobs;
natural resources and construction; trade, transportation and
utilities; and financial activities remained unchanged in February.
The only private sector entities registering loses were manufacturing
and information with 100 jobs lost, respectively. The public sector
lost 400 jobs in the federal government while public transportation
gained 100 jobs?the District government remained unchanged.?



Retailtrafficmag.com
Economic strength
http://retailtrafficmag.com/ar/retail_economic_strength/
?The composition of the Washington economy is different than other
economies, with the federal government representing nearly a third of
the local economy. In 2000, the federal government spent $74.1 billion
in the Washington D.C. metro area on items ranging from payroll to
procurement of goods and services.

Because its spending is non-cyclical, the federal government has a
stabilizing influence on the Washington D.C. economy. ?It grows every
year in spending,? Fuller notes. ?This fuels the private sector.??



Bizforward.com
What Now? - Washington's Wartime Economy
http://www.bizforward.com/wdc/issues/2001-11/whatnow/economy.shtml
?Washington is different, and it has proven much less vulnerable to
cyclical forces over the years. This has not changed with the
downsizing of the federal workforce in the '90s, and it is what will
continue to protect the area economy from the full force of the
national recession that is likely to grow out of the terrorist
attacks.

Our economy is built on five core industries that are unusually
interdependent and distinguish Washington from other areas: the
federal government, the technology industry, international business,
the hospitality industry and the building industry. These industry
clusters draw their income (the money they inject into the area
economy) predominantly from sources outside the metropolitan area.?

---

?It's the technology and construction industries that are the most
vulnerable to cyclical trends. But in Washington, both of these
industries benefit from government-based revenues. More than one-third
of the technology industry in the Washington area draws its revenues
from federal contracting. Despite the shakeout in the industry, the
Washington technology industry was still adding net new jobs up until
September 11.?

---

?This mix of core industries almost guarantees growth each year. In
2000, when the economy increased 4.8 percent, the federal government,
international business, the hospitality industry and the construction
industry (the economy's historic strength) accounted for half of the
gains, while the technology sector, though representing only 20
percent of the economy, accounted for the other half of its growth.?



Mason Enterprise Center
The Washington Area Economy: Resilience and Recovery
http://www.masonenterprisecenter.org/Outlook%202003%20Text.doc
?What has distinguished the Washington area economy from all other
metropolitan area economies and cushions it from the full down-side
impact of the national business cycle is its sectoral structure.  This
is best illustrated by identifying the industrial clusters or groups
of interdependent activities that generate the largely non-local
income they spend locally in support of their employees (payroll
outlays) and retirees, operations (spending for overhead and
procurement), subcontractors and partners.


The federal government is the largest of these core industries. 
Federal spending, by itself, accounts for more than 30 percent of
gross regional product but the economic impact of the federal
government is far larger than its direct spending.  It encompasses all
of the private activities whose presence and activities in the
Washington economy revolve around its national capital functions.
Lobbyists, membership organizations, and legal services specializing
on federal regulations, patents and trademarks, and contracting fill
out the federal government industrial cluster.  There are others. 
However, federal spending in the Washington economy by itself is
enormous and continues to grow year-in year-out averaging 4 percent
annually over the past 20 years.  In 2001, federal spending increased
6.9 percent and this increase did not reflect any increased spending
associated with the War on Terrorism.   That new spending and
increased local spending associated with the new Department of
Homeland Security will show up in 2002 and 2003 and is likely to
continue increasing the area?s share of procurement outlays nationwide
in coming years.?


=============================================================

Other references:


District of Columbia Department of Employment Services
Wage and Salary Employment by Industry and Place of Work
http://does.dc.gov/does/frames.asp?doc=/does/lib/does/info/lmi/LMI_Tables_1.pdf



District Columbia Department of Employment Services
Employment Projections by Industry and Occupation 2000-2010
in the Washington Metropolitan Area and the District of Columbia
http://does.dc.gov/does/frames.asp?doc=/does/lib/does/info/Industry_Occupation.pdf



U.S. Department of Labor
Bureau of Labor Statistics
2002 State Occupational Employment and Wage Estimates
District of Columbia
http://www.bls.gov/oes/2002/oes_dc.htm



U.S. Department of Labor
Bureau of Labor Statistics
2002 Metropolitan Area Occupational Employment and Wage Estimates
Washington, DC-MD-VA-WV PMSA
http://www.bls.gov/oes/2002/oes_8840.htm



U.S. Department of Labor
Bureau of Labor Statistics  
District Of Columbia Economy at a Glance
http://www.bls.gov/eag/eag.dc.htm


=============================================================


I hope you have found this information helpful.  If you have any
questions, please request clarification prior to rating the answer.

Googlenut



Google Search Terms:

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dc "economic base"
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"dc economy"  seasonal OR cyclical
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"dc economy"  cyclical
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shikibobo-ga rated this answer:5 out of 5 stars
Thank you. Right on point.

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