Why Northern Virginia's Unemployment Is Below National Levels

With national unemployment hovering near 9 percent, Northern Virginia may be one of the few places where economic recovery isn’t dominating public conversation. For most northern counties, unemployment rates in the past year have remained between 3 and 7 percent, and in Arlington County unemployment actually dropped to 3.8 percent.

"There's no magic bullet to success," said regional economist Troy Palma of Arlington County's Economic Development Office. "But you have to consider our workforce is highly educated. Sixty-nine percent of Arlington residents have at least a bachelor's degree, and as of last October, the average national unemployment rate of those with bachelor's degrees was 4.4 percent, which is much lower than the country's overall unemployment rate. So in a way, what you're seeing here is reflecting national trends."

According to Palma, the other key factors cementing lower unemployment and healthy economic success are excellent urban planning, which has made the area attractive to both businesses and working professionals, and business-friendly policies such as lower tax rates that give the area an edge over nearby Maryland and D.C.

He also emphasized the growing role that educational and research institutions are playing in the local economy, pointing to the growing presence of universities in the area. This year, Virginia Tech opened a campus in partnership with IBM and George Mason and George Washington universities expanded their Arlington campuses.

Despite a growing private sector and assertions of a diversified economy, the region's major employers show that the federal government continues to have a large presence. Seven of Arlington County's 10 largest employers are directly related to, or heavily funded by the federal government.

Arlington's Top 10 Employers in 2011:

U.S. Department of State

Source: The Arlington Office of Economic Development

Neighboring counties also rely on a strong federal presence. In Fairfax County, several top employers are also linked to federal contracts. As federal spending shrinks, it will present a challenge to counties in the region that have received large amounts federal funding for decades.

Fairfax County's Top 10 Employers in 2011:

Source: The Fairfax Office of Economic Development

While beneficial to local economies, federal funding does not guarantee employment. For unemployed residents, slow economic recovery is making job hunting in these counties just as difficult as it is in the rest of the U.S.

"Compared to other places, there are a lot more jobs available in this area, but competition is stiff," said long-time Arlington resident Sandra Kyle, who was searching for jobs at the Arlington Employment Assistance Center. A full-time teacher until last June when budget cuts led to staff layoffs, Kyle is also a cancer survivor. Her search for employment is complicated because for medical reasons she cannot work in a stressful environment. "I'm just trying to keep faith and stay positive, but it's been difficult."

At the center, Arlington residents have access to 50 computers which have 300 job search websites already bookmarked. There are printers, case workers available to provide guidance, and for those who qualify for additional assistance, one-on-one councilors for career advisory.

"Obviously in 2008 when the bottom fell out of the economy, we started seeing more people coming in just like in the rest of the U.S," said counselor Fernando Delgado, who has worked at the Arlington Employment Assistance Center for six years. "Compared to other regions, our unemployment rate is incredibly low, but five years ago it was at 1.3 percent, and now it's close to 4 percent, so we're still experiencing unemployment levels that are three times higher than they were several years ago."

Join us this week as we take a closer look at Northern Virginia's economy:

Tomorrow: Learn why the Super Committee's failure to reach a decision could spell out financial losses for northern Virginia's economy.

Wednesday: Hear what local retailers are expecting this holiday season and find out what some top selling items have been so far.

Thursday: Get the inside scoop from real estate experts on why they think the regional housing market could be bouncing back.

Friday: Wrap up the week with economic guru Stephen Fuller of George Mason University for a discussion on the future of northern Virginia's economy. As federal dollars decrease, where will the economy move?