DC Region Loses 100K Jobs As Federal Cuts Hit Local Economy

The Washington Metropolitan Region lost more than 100,000 jobs over the past year, while the rest of the country gained slightly, according to new data released by the Metropolitan Council of Governments.

Citing the Bureau of Labor Statistics, the COG reports that the region lost 100,500 jobs between May 2025 and May 2026, about a 3 percent drop. More than half were federal government jobs.

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Losses included:

• 54,500 federal government jobs
• 32,100 professional and business sector jobs
• 7,500 leisure and hospitality jobs
• 1,900 education and health services jobs.

Additionally, the trade, transportation and utilities sector added about 300 jobs, COG said.

Unemployment Rates Steady

Unemployment rates around the region remain below the national average, with the metropolitan statistical area’s average at 3.9 percent compared to the national 4.4 percent.

Unemployment has been trending slightly downward since the start of the year, but increased by about a percentage point between January 2025 and January 2026. In the same period, the region lost 62,000 federal jobs.

The number of unemployed people in Northern Virginia has fluctuated since the start of the year, with a slight uptick between April and May, from 46,028 to 47,700, according to the Northern Virginia Regional Commission.

The region’s inflation rate has also jumped from 3 percent in March to 4.1 percent in May, roughly mirroring national rates.

The Washington metropolitan area has a higher concentration of federal employment than any other region in the country. Job losses have been felt acutely in the region, particularly the wave of layoffs triggered by the Department of Government Efficiency (DOGE) budget cuts.

The region's professional sector has also been bleeding jobs as budget cuts reverberate among contractors, the professional services sector and federal grantees. General Dynamics recently announced layoffs among some of its Pentagon workers.

The state of Virginia and some regional governments have launched programs to help laid-off federal workers and contractors bounce back.

Read more about job losses in Virginia here.