Cost-information website howmuch.net released a report based on the Bureau of Economic Analysis 2014 statistics indicating that Washington, D.C.’s economic growth lags behind other major U.S. metropolitan areas on Nov. 18.
The report analyzed 381 metro areas and found that the gross domestic product grew in 282 of them. The professional and business services sectors accounted for 27 percent of GDP growth in 314 of the 381 areas.
In the report’s ranking of 10 cities by growth in GDP, the D.C. metro area ranked lowest with a 0.3 percent growth rate. The Dallas and San Francisco metro areas came in the top spots with 8.5 percent and 5.2 percent growth rates, respectively.
Director of Research at the Georgetown Center on Education and the Workforce Jeff Strohl said that D.C. has done fairly well through the recessionary period. He added that the city is known for having a strong labor market with high incomes, high earnings and low unemployment.
“For the growth rate to slow down a little bit in the face of some restrictions in government spending doesn’t actually come off as that surprising,” Strohl said. “I wouldn’t make too much hay out of that.”
However, Strohl said that D.C.’s low ranking in comparison to the growth rates of other large metro areas should not be of serious concern and said that economic statistics are often relative in nature.
“There have been indications in the past that the D.C. area will slow down with decreases in government and military spending,” Strohl said. “The D.C. labor market was fairly stable during the recessionary period. D.C. didn’t decline a lot, but it’s also not going to grow a lot.”
Strohl also stressed the importance of D.C.’s economic stability during the recession. According to the Bureau of Labor Statistics, in 2008 and 2009, the District’s unemployment rates averaged around 5.8 percent and 9.3 percent, respectively. The national average was 9.9 percent during the same period.
“The D.C. metro area has had some of the lowest unemployment rates in the country during the recession. Now we are moving into recovery and economic growth is starting to spurt off elsewhere,” Strohl said. “Relative to those places that are doing really well Washington is doing relatively well.”
Strohl argued that the main factor contributing to the D.C. metro area’s slow economic growth is decreased government spending.
“Uncertain government spending is what really causes the problem,” Strohl said. “You don’t know when to make investments and this begins to affect stuff. Growth can be impacted just as much by uncertainty as actual declines in spending.”
Strohl said that because Georgetown students often navigate a national job market after graduation, the local economy is not as significant to job search success as it may initially seem.
“Georgetown and its graduates should fare fairly well,” Strohl said. “People apply to Georgetown from Vermont to California and its graduates do that same thing when looking for jobs.”
Andrew Yan (COL ’16) said that he was not concerned about the impact of the city’s low economic growth on his career prospects after graduation and added that GDP is not a fully accurate means of determining economic growth.
“I don’t believe that GDP is a reliable indicator of how well any area is doing,” Yan said. “It is much more important to look at employment rates for young people and the availability of actual paid opportunities.”
Christi DeSimone (COL ’16) echoed Yan’s sentiments, expressing the belief that GDP figures have little relevance to her career search.
“I’m just trying to get into an industry,” DeSimone said. “Maybe my opinion would vary if I was looking for a paid position. If I was going to a market that incorporated more investment or finance, it might matter more. But as far as I know, for my friends who are going into investment banking, I don’t think GDP has really affected them at all.”