DC’s exposure to negative impacts from a US recession is probably growing

DC’s private sector is now a larger share of the economy, and the City cannot count on increased federal spending to offset negative impacts

The U.S. economy is about to enter the longest period of economic expansion in its history as it passes the 10-year mark in June. Although a possible recession is not evident at this time, at some point a recession it is likely. When that happens, the negative impact on DC’s economy would depend on the nature and severity of the recession. However, as explained below, DC’s economy is not insulated from recessions, and exposure to the negative impacts from a recession is probably growing.

  • The negative impacts on jobs and wages in DC’s private sector in the past two recessions were similar to, although somewhat less severe, than the impact on the private sector nationally when manufacturing and mining are excluded from the calculation. (See graph of wages below.) There is no obvious reason to expect this to relationship to be significantly different in a future recession.
  • Federal spending gave a disproportionate boost to DC’s economy in the past two recessions, mitigating some of the negative factors confronting DC’s private sector. Current federal fiscal policy makes it less likely that such increases in federal spending can be counted on in the future.
  • The share of DC’s economy represented by the private sector has been rising, increasing the economy’s exposure to a downturn.
  • Jobs and incomes of DC residents were harder hit than those associated with jobs located in DC in the last two recessions. Being hit harder may not necessarily be true in another recession because DC’s economy has become stronger, but a substantial negative impact on residents would still be expected.
  • The negative impacts of the 2007 recession in DC’s suburbs were generally similar to those that occurred in the District of Columbia. Private sector jobs fell a little more sharply in the suburbs,  wages and salaries fell more sharply in DC, and the percentage drop in resident employment was about the same in both locations.

chart 1

Recession and DC’s private sector. In the 2001 and 2007 recessions, the manufacturing and mining sectors of the U.S. economy, which comprise around 15% of the U.S private sector, were hit very hard. In the 2007 recession, for example, wages and salaries in the manufacturing sector declined 13.9% from 2007.2 to 2009.3. The very large remaining part of the U.S. private sector was also adversely impacted by the recession, but not nearly as much, with wages and salaries falling 2.9% over the same nine-quarter period. The recession’s impact on DC’s economy was nothing like that on places with a lot of manufacturing and mining.  However, neither was DC insulated from adverse effects. This is evident by comparing what happened in DC with the experience of the part of the U.S. private sector that does not include manufacturing and mining.

The graphs of changes in both jobs and wages in DC’s private sector during the 2001 and 2007 downturn show a similar pattern to the US private sector with manufacturing and mining left out. The extent of the downturn in DC’s private sector is somewhat less, however. For example, a one year decline of 3.2% in private sector jobs in DC in the 2009.3 quarter compared to 4.8% in the private sector nationally (with manufacturing and mining excluded). Similarly, the one year drop in wages in DC’s private sector in the 2009.1 quarter was 4.1% compared to 6.0% in the US.

In a future recession, it would be reasonable to assume that the exposure of DC’s private sector would again at least be similar to that in the US as a whole (excluding manufacturing and mining sectors). However, one reason the private sector impact was lower in DC than for the similar sectors in the US in the last two recessions was the relatively large boost in federal spending that benefitted DC’s economy as the recession unfolded.

Chart 2Table 1.PNG

Federal spending. In the 2001 and 2007 recessions, federal spending increased, providing a counter-cyclical boost to the economy. Because the federal government accounts for such a relatively large portion of DC’s economy, this spending has provided a much more substantial boost to DC’s economy than was true nationally. (Federal jobs account for 25% of the jobs in DC compared to 2% nationally, and federal wages and salaries account for 31% of the total earned in DC compared to 3% nationally. Looked at another way, DC accounts for about 7% of all federal jobs and about 9% of all federal wages and salaries.

The proportionately greater boost that DC received from federal spending is evident in the change in wages and salaries that occurred in DC and the US from 2008.1 to 2009.1, a year right in the middle of the Great Recession. Federal wages and salaries in DC increased by $1.02 billion in that year, equivalent to 75% of the loss in private sector wages. For the US, the increase in federal wages was equivalent to only 2.3% of the private sector decline. The increase in federal wages and salaries in DC was 15.8% of the US total.

In a new recession it would appear that DC cannot count on receiving such a relatively large boost from federal spending. Under current federal fiscal policies, debt is increasing even as the economy expands. If controlling the level of federal debt is a policy concern at the time another recession occurs, counter-cyclical spending is likely to be much more moderate, if it happens at all, and the proportion spent in DC may be less.

table 2

chart 3.PNG

Private sector share of the economy. In the years since the 2007 recession the private sector share of DC employment and wages has been rising. In 2009.2, the recession’s last quarter, DC’s private sector accounted for 66.1% of all jobs in DC and 59.9% of all wages in the economy. By the 2018.4 quarter, these shares had risen to 70.2% and 64.6%, respectively. With this rise in the private sector’s share of the economy, it is reasonable to expect the potential for negative impacts on the DC economy from a US recession also to rise.

chart 4

Recession impact on DC residents. In the 2001 and 2007 recessions the jobs and earnings of DC residents (some of whom worked outside of DC) were more adversely affected than were the jobs and earnings related to all the jobs located in DC. In the 2001 recession, resident jobs and wages fell more quickly in the first quarter of 2001 when the recession began. The consequences for DC residents then lingered, which is likely related more to the shock of 9/11 than to the recession itself (9/11 occurred before the recession ended).

In the 2007 recession, neither the jobs located in DC or those for DC residents fell right away when the recession began. By the second quarter of 2009, however, resident jobs were 2.3% lower than a year earlier compared to 0.9% lower for all jobs located in DC. One year into the recession, the earnings of DC residents went from growing at a very fast 7.6% rate in the 2017.4 quarter to –1.0% in the 2018.4 quarter. Earnings of all those working in DC also fell, but not quite as much—from a 6.1% growth rate in 2017.4 to 2.5% in 2018.4.

The jobs and earnings of DC residents surely would be adversely affected by a new recession, but there have been changes in the economy that might mean the impact would be more like —or even less than— that affecting jobs and earnings for all working in DC. For example, DC’s population began to grow in 2005 and it is now 128,051 (22.3%) higher than it was in 2007 when the recession began. From calendar year 2009 to calendar year 2018, DC resident jobs grew faster than jobs located in DC (25.5% versus 12.9%), and the growth in amounts earned by DC residents also well outpaced the amounts earned in DC (64.5% versus 42.4%). Also, DC resident jobs and earnings recovered faster from the 2007 recession, and the growth of resident jobs and earnings also generally remained above jobs and earnings for all persons working in DC for the period of the sequester (FY 2013) and subsequent years.

chart 5

chart 6


DC and the Washington area suburbs. The negative impacts of the recessions were generally similar for DC and for the Washington suburban area, but there were a few differences. In the 2001 recession (which included the 9/11 attack), private sector jobs located in DC fell more sharply than those located in the suburbs, but suburban private sector wages fell more than amounts earned in DC. In the 2007 recession, the differences were reversed: the suburbs experienced more private sector job decline and less decline in private sector wages and salaries. In the 2007 recession, the percentage declines in resident employment in DC and the suburbs were about the same.

The appendix charts show changes in private sector jobs, private sector wages and salaries, and resident employment for DC, the Washington area suburbs, and the US.


chart 7

chart 8


Chart 11


About the data: The wage and salary employment data for DC, the Washington area suburbs, and the US is from the US Bureau of Labor Statistics (BLS), as is the data on resident employment in all locations. Most of the data shown here are based on quarterly data calculated from data that is not seasonally adjusted. Washington suburban area data is calculated by subtracting the amounts for the District of Columbia from metropolitan area totals.

Data on earnings and wages and salaries in DC and the US are from the quarterly Personal Income accounts compiled for states and the US by the US Bureau of Economic Analysis.

Data comparing jobs and wages and salaries in DC, the Washington area suburbs, and the US were accessed through Moody’s Analytics. The data are all seasonally adjusted.

All of the data are subject to further revision next year.

US business cycle expansions and contractions are officially designated by the National Bureau of Economic Research (NBER). According to NBER, the 2001 recession was a brief one, extending only from March 2001 (the first quarter) to November 2001 (the fourth quarter). Particularly for DC, the occurrence of the 9/11 attacks in the midst of the recession makes it more complicated to discern only the recession’s impact on DC.

NBER defines the Great Recession of 2007 as running from December 2007 (the fourth quarter) to June 2009 (the second quarter).

An earlier version of this blog appeared in the April 2019 District of Columbia Economic and Revenue Trends issued by the DC Office of Revenue Analysis of the DC Office of the Chief Financial Officer.


Charts of (1) private sector jobs,  (2) private sector wages and salaries, and (3) resident employment for DC, the Washington area suburbs, and the US.

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Chart 11


Chart 12

The curious connection between DC population growth and new Class A residential buildings

The new buildings are clearly related to DC’s population growth, yet population growth slowed as building increased

According to the US Census Bureau, DC’s population started growing in 2006, and in the 13 years from 2005 to 2018 DC added 135,319 people, a 23.9% increase. Over that same time, according to CoStar, there was a net increase of 303 multi-family residential buildings containing 40,388 multifamily housing units, a 27.6% increase.


table 1


Of the increase in multi-family housing, 74.3% of the buildings and 84.3% of the units occurred in what CoStar classifies as Class A buildings. These are newer, well-located apartments and condominiums with modern amenities. About 80% of the Class A units are apartments (see the appendix for more detail). Over the 13 years from 2005 to 2018 there was a 446% increase in units in Class A buildings compared to a 4.6% net increase in all other units.


graph 1


That there has been a significant increase in multi-family buildings and units is not surprising to anyone familiar with all the cranes that have dotted the city for more than a decade. What may be surprising, however, is the extent to which a relatively large proportion of the residential construction, especially that of Class A units, lagged population growth and occurred as population growth was actually slowing. The proportion of the entire 2005 to 2018 population growth that had occurred by 2013 was much greater than proportion of new housing units that had occurred by that date:

  • By 2013 DC had added 60.8% of the population growth that occurred from 2005 to 2018, but only 44.2% of the net increase in all multi-family housing units over the entire period—and only 39.0% of those in Class A structures.
  • From 2013 to 2018 DC added 38.4% of the population growth that occurred from 2005 to 2018, but a much greater share (55.8%) of the net increase in all housing units in multifamily structures occurred then. The share of Class A structures added after 2013 was 61%.
  • In 2013, the year of the largest annual gain in population, DC added 15,706 people and 2,078 net new multi-family housing units. In 2018 population growth was less than half (6,764) of what it was 5 years earlier while the net increase in housing units in multifamily buldings was more than twice as much ( 4,408).


table 2.PNG


graph 2


From the CoStar data on housing it is not possible to explain all of the dynamics that link population changes in DC to housing market developments. Clearly until 2013 most of the increase in population did not find housing in new Class A buildings. As we approach 2018, however, a much higher percentage of the growth could be housed in such units.  In 2013 the ratio of population growth to net increase in multifamily units of all classes was 7.6.  In 2018 that ratio has fallen to l.5. This means that the entire net increase in population in 2018 could have been housed in new (mostly Class A) housing if the average household size was 1.5.


Going forward, an interesting question is how much of a limiting factor the availability of new Class A housing may to population growth in DC.  There are quite a number of factors at play and so it is difficult to draw a firm conclusion here.  For example, not all Class A units that are occupied (or rented) are necessarily occupied or rented by residents who would be counted by Census as part of DC’s population. This could involve persons whose primary residence is in another state, units owned for temporary housing of corporate personnel, or units owned for short term rentals. Also if persons now sharing units in DC move to newly constructed ones to live by themselves, occupied units would increase without any increase in population. The full story linking population and housing market changes must, of course, take account of all housing units in the city, not just those in Class A units in multi-family structures.


As noted above, most of the Class A buildings are apartments. More details on Class A residential buildings are contained in the appendix.

About the data: 

This is the second of two blogs dealing with  population dynamics in the District of Columbia in relation to the latest  US Census Bureau estimates of DC population.

The population information reported here is from the DC population tables released in December 2018 by the US Bureau of the Census in connection with population estimates for the 50 states and the District of Columbia as of July 1, 2018.  The data include revisions to the years 2010 through 2017, and all information is subject to further revision next year.

Housing data is from CoStar, a real estate information firm that tracks all private sector apartment and condominium housing units in multifamily buildings with 5 or more units. Information for each year is for the second quarter, which corresponds closely to the July 1 date used by the Census Bureau for estimating annual population numbers. CoStar data is continuously updated and revised as more information becomes available.

A version of this blog appeared in the January/February District of Columbia Economic and Revenue Trends report, issued by the DC Office of Revenue Analysis.


table 3

graph 3

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graph 6

DC’s population topped 700,000 in 2018, but last year also saw the slowest annual increase in a decade

Natural increase, not net in-migration, has become the main source of DC’s population growth.

The US Bureau of the Census estimates DC’s population on July 1, 2018 was 702,455, an increase of 6,764 (1.0%) from the revised estimate for 2017. This is notable for several reasons:

  • 2018 is the 13th straight year of population growth. From 2005 to 2018 population grew by 135,319, a gain of 23.9%.
  • 2018 is also the slowest population growth in a decade. From 2008 to 2018 DC’s population grew an annual average of 12,222. Growth in 2018 was just 55.3% of the
  • decade’s average.
    graph 2


graph 1


  • 60.7% of the net increase in population from 2017 to 2018 was accounted for by natural increase of 4,104. (Natural increase is births minus deaths.) The rest of the net change was from international migration. For migration within the US, 936 more people left DC than moved here.


graph 3


  • DC’s population was larger than that of 2 states (Vermont and Wyoming), and last year’s growth was more than in 16 states (9 of which actually lost population).
  • In percentage terms, DC’s rate of growth was well above the US (0.6%) rate and above that for 36 states.

Additional details on recent growth, revisions to past years, population change since 2000, and comparison with the 50 states are included below.


Revision to the 2017 estimate. The July 1, 2018 DC population estimate of 702,455 is actually 8,463 higher than last year’s 2017 estimate. However, the increase over 2017 is now estimated to be 6,764 because revisions to population estimates in earlier years have resulted in a new estimate for 2017 that was 1,719 higher.   The current estimate for 2017, 695,691, is 1,719 less than the prior one (693,972).

As shown in the accompanying table and graph, the revision to prior years involved all the years from 2010 to 2017. The higher estimate for 2017 reflects the cumulative impact of increases and decreases since 2010. Although the level in 2017 was higher, growth in 2017 over 2016 was actually lower (by 520 persons).

table 1.PNG

graph 4

Components of population change last year compared to the 8 1/4 years since the April 1, 2010 Census. The 6,764 increase in DC’s population from 2017 to 2018 was just a little over half (55.4%) of the 12,205 annual average since the April 2010 decennial census count. Several features stand out:

  • Natural increase has become the major contributor to DC’s net population growth. This past year natural increase accounted for 60.6% of the increase; its average contribution since 2010 was 37.4%. Although births and deaths last year both exceeded their annual averages since the census, natural increase was less than the post-census average because deaths increased more than births.
  • Domestic migration is no longer a source of net growth for DC. Net domestic migration contributed 29.3% to growth since the census, but now more people are leaving DC for other parts of the US than are arriving from them.
  • International migration has become a more important source of growth for DC. It was the source of 32.0% of the net increase in DC’s population in the years since the census, and 53.1% of the growth last year.

table 2.PNG


Comparison with the 50 states. In 2018 DC’s population was greater than that of Wyoming and Vermont. (The next closest states to DC are Alaska (737,438) and North Dakota (760,077)), Also, from 2017 to 2018:

  • DC’s population increase exceeded that in 16 states (9 of which lost population).
  • DC’s natural increase was greater than in 11 states (2 of which were negative).
  • DC’s net domestic migration was less negative than in 26 states.
  • DC’s net international migration was greater than in 18 states.


table 3

Details on comparisons with the states for 2018 and for changes from 2017 to 2018 are shown in the appendix.

About the data: This is the first of two blogs dealing with aspects of population growth in the District of Columbia.

The information reported here is from the tables released in December 2018 by the US Bureau of the Census in connection with population estimates for the 50 states and the District of Columbia as of July 1, 2018. Those tables include (1) total population; (2) population as of April 1, 2010 in the decennial census and as of July 1 of each year from 2010 through 2018; (3) components of population change from July 1, 2017, to July 1,2018; and (4) components of population change from April 1, 2010, to July 1, 2018. The components of change are natural increase (with births and deaths shown separately) and net migration (with international and domestic migration shown separately. The data include revisions to the years 2010 through 2017.

A version of this blog appeared in the December 2018 District of Columbia Economic and Revenue Trends, issued by the D.C. Office of Revenue Analysis.


graph 5.PNG



Are growth of the labor force and resident jobs slowing in DC? Maybe—and maybe not.

Seasonally-adjusted and unadjusted data from BLS currently tell different stories

Each month the US Bureau of Labor Statistics (BLS) estimates labor market statistics for all states and the District of Columbia. Labor market statistics include the labor force, resident employment, unemployment, and the unemployment rate. The data is reported on both a seasonally adjusted and unadjusted basis. Seasonal adjustment takes account of recurrent events during a year such as holiday employment that can mask trends in the data.

Typically, comparing data from the same month of the prior year eliminates the need for seasonal adjustment. Accordingly, it would be expected that there should be little difference between seasonally adjusted and unadjusted estimates of the annual change in DC resident employment from September 2017 to September 2018. Currently, however, the two data sets give very different pictures of the change over this time, leaving unanswered the question as to whether DC’s resident employment is or is not slowing significantly.

  • The seasonally-unadjusted data say that from September 2017 to September 2018 resident employment (measured by the 3-month moving average) increased by 3,870 (1.0%). By contrast, the seasonally-adjusted data peg the increase at twice that (8,067, a 2.1% gain).
  • The unadjusted data show quite a sharp decline in the amount of year-over- year growth since May 2018, while the adjusted data show an increase.
  • The unadjusted data peg growth over the past year at about half the annual average increase over the past 5 years. Seasonally adjusted, the growth is very close to the average of the past 5 years.          

Details are shown in the tables and charts in the appendix. As indicated there, the story is similar for the seasonally adjusted and unadjusted estimates of DC’s labor force.

The current difference between the one year change in the seasonally adjusted and unadjusted resident employment and labor force data is an unusually clear example of the difficulty in spotting changes in the economy by closely monitoring data as it is released each month or each quarter. As with Personal Income, population, and other data produced by federal agencies, labor market data is revised as more information becomes available.

As the labor force data is revised the current differences in the story about changes over the past year told by the seasonally-adjusted and unadjusted data will be resolved. However, it will likely not be until March 2019 when major annual revisions typically occur that the matter will be cleared up.

It should be noted, however, that the seasonally-adjusted and unadjusted data both tell the same story about unemployment: the amount and rate of unemployment fell over the past year.











About the data. The labor market information is from the statistics released each month for the District of Columbia (along with all states) based on a population survey. The data include resident employment (persons over 16 years of age who say they are working on a full or part time basis); unemployment (persons over 16 years of age who are not working but say they are looking for work); labor force (the sum of resident employment and unemployment); and the unemployment rate (unemployment as a percentage of the labor force).

The data are reported on both a seasonally adjusted and not seasonally adjusted basis. For the month of September 2018 the data reflect the revisions which were part of the October 2018 release. The annual comprehensive revision to the data will occur in March 2019. All calculations here are based on 3-month moving averages (e.g., September 2018 is the average of July, August, and September as reported by BLS).

Seasonal adjustment is a statistical method for removing the seasonal component of a time series that exhibits a seasonal pattern. It is usually done when wanting to analyze the trend of a time series during a year independently of the seasonal components. It is common, for example,  to report seasonally-adjusted data for unemployment rates to reveal the underlying trends in labor markets.

An earlier version of this blog was included in the October 2018 District of Columbia Economic and Revenue Trends report issued by the Office of Revenue Analysis of the District of Columbia Office of the Chief Financial Officer.



In the last 5 years DC added 180 new apartment and condominium buildings with 22,348 units

The new units are essential to DC’s ability to absorb a growing population, but they are not the whole story

From 2012 to 2017 DC’s inventory of apartment and condominium housing units grew by a net of 22,348 according to CoStar, a real estate information firm that tracks developments in the District and many other locations. This 13.7% increase in housing units is a major element in the growth of DC’s population over that time, a relationship that will be looked at shortly. But first, a few details on the recent changes to the District’s stock of apartment and condominium units.

graph 1

table 1

  • Of the 22,324 net increase in units, 20,128 (90.1%) were in 95 apartments and 2,196 were in 84 condominiums. The average size of condominium buildings was much smaller, 26 compared to 212 for apartments. Condominiums therefore accounted for 47% of the buildings, but just 10% of the units. (In 2017, condominiums accounted for about 19% of the combined total multifamily units— condominium, apartment, and co-op—in the city.)
  • The number of new units delivered over the five years was 23,099, but 775 units, about one-half percent of DC’s stock of multifamily housing in 2012, were demolished or otherwise went out of existence.
  • The number of vacant apartment units increased by 2,374 over the past 5 years, and the vacancy rate rose from 6.5% in 2012 to 7.3% in 2017.
  • New construction at the end of 2017—11,179 apartment units and 1,614 condominium units—essentially continues the pace of recent development activity. It will take two or more years for all of this existing construction to deliver new units to inventory, and the amount of this new construction is more than half of the net increase in units that occurred over the previous 5-year period of 2012 to 2017. For apartments current construction is 56% of the prior 5 year net increase in units, and for condominiums the percentage is 74%.

Detail for each of these points are in the tables in Appendix 1.

Apartments, condominiums, and DC population dynamics

The number of occupied apartment and condominium units grew by 19,930 from 2012 to 2017. This is almost 2,400 less than the 22,348 net increase in inventory, but in percentage terms the gain in occupied units—12.9%—was greater than that of population over that time (9.2%).

table 2

table 3

Newly occupied apartment and condominium units clearly represent a major element in the demographic changes occurring in DC. Available data does not, however, make it possible to know exactly how much of the 58,342 growth in DC’s population from 2012 to 2017 was accommodated by the net increase in occupied apartments and condominiums described in the CoStar data. A judgment on this depends on the additional number of households associated with the increase in population—and this can only be estimated.

Definitions further complicate the task of trying to compare Census and CoStar information. For the Census Bureau, a household is equivalent to a housing unit occupied by DC residents. The resident household can be a single person, a small family, a large family, or a group of unrelated persons who share the unit. To be classified as occupied by CoStar, however, a unit need not only be occupied by a DC resident household (as defined by Census). Occupied units from the point of view of a property owner can also involve second homes, short-term rentals, corporate accommodations for employees and guests, units in transition waiting for a new owner or tenant to move in, or ones undergoing repairs. The growth in occupied units as defined by CoStar can thus easily exceed the increase in households as defined by Census.

That said, a reasonable place to start in connecting population increase to change in apartment and condominium occupancy is with the Census. In 2000 the ratio of population to households was 2.30, a ratio which fell to 2.27 in 2010. In that decade, the number of households grew faster than population (7.4% compared to 5.8%), and the ratio of the increase in population to the increase in households was only 1.80, suggesting that one of the features of population growth at that time was small households.

What of the period between 2012 and 2017? Was the increase in small households so great that the number of households grew faster than population, and the population/household ratio continued to get smaller? Or did population grow faster, resulting in a rise in the ratio? Among the factors contributing to this latter result would be more children and more people doubling up due to affordability issues.

Assumptions about an appropriate population/household ratio makes a big difference in assessing how many new households population growth has brought—and how much of that growth was accommodated by occupancy growth in apartment and condominium buildings. As noted above, the 2010 average population/household ratio was 2.27. That ratio applied to population growth over the 2012 to 2017 period yields an estimated growth in households of 25,701, a number that exceeds CoStar’s estimate of the increase in occupied units by 5,771.

The 2012-2016 American Community Survey 5 year estimate pegs the population/household ratio at 2.38. Applying that higher ratio gives 4,583 as the amount by which household growth exceeded the increase in occupied units. With ratios a little higher or lower than these averages new household growth exceeds the growth in occupied units. Only if the population/household ratio rises to 2.93 does the new household estimate equal that for the growth in occupied units. Under a range of plausible assumptions it appears likely that the District of Columbia added more households over the past five years than could live in newly occupied units in new apartment and condominium buildings. If this is the case, this means that other components of the housing stock—structures with four or less units—must have been able to absorb some of the increase in population.

table 5

Taken as a whole, the DC housing stock does provide room to accommodate some of the growth in population in units other than those in new apartment or condominium buildings. The Census Bureau’s American Community Survey estimated that for the 5-years 2012 through 2016 there were 306,711 housing units in DC, and that 160,750 (52.4%) of those units were in structures with 5 or more units. In other words, almost half of DC’s housing stock is in smaller buildings. Over the past 5 years more than 1,000 permits have been issued for projects with less than 5 units, and many smaller buildings can be reconfigured to accommodate more units.

table 4.PNG

In this connection, in the prior 5 year period— 2007 to 2012—larger buildings appear to have played a smaller role in accommodating population growth than in the most recent five years. From 2007 to 2012 Co-Star’s estimate of occupied units grew more slowly than population (6.9% versus 10.7%). The ratio of new population to the estimated increase in occupied apartments and condominiums was 6.1. (See Appendix 2. for more details.)

table 6

With the current pace of construction for apartment and condominium buildings much like that of the past few years, multi-family apartment and condominium projects will undoubtedly provide the largest share of the additional housing needed for DC’s growing population—provided, of course, that a sufficient number of households can afford to live in them. But the connection between increases in population and changes in the housing stock is a complex one, and DC’s changing demographics involve more than simply building large new apartment and condominium buildings for new people.

Appendix 1

Gross and net changes to inventory.

table 7

Apartment share.

table 8

Vacant units.

table 9

New construction.

table 10

Appendix 2

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About the data. Data on DC multi-family housing buildings and units are for apartments, condominiums, and co-operative apartments of all classes in structures with 5 or more units as reported by CoStar, a real estate information company. The data was accessed toward the end of April. Population data and data from the American Community Survey are from the US Bureau of the Census. The housing and population data are all subject to revision by the source as more information becomes available.

This analysis looks solely at the statistical relationships between changes in DC population, households, and housing units.  It does not address issues related to affordability or homelessness.

An earlier version of this blog was included in the April 2018 District of Columbia Economic and Revenue Trends report issued by the Office of Revenue Analysis of the District of Columbia Office of the Chief Financial Officer.



New income and labor force data give a more positive 2017 year-end picture of DC’s economy

Although federal jobs are declining, income is rising, the job structure is more diverse, and unemployment is falling

In March the US Bureau of Economic Analysis (BEA) released its estimate of income in the District of Columbia for the last quarter of calendar year 2017 along with revisions to the prior three quarters of 2017. Also in March, the US Bureau of Labor Statistics (BLS) revised labor force data for the past several years for wage and salary jobs located in DC and employment of DC residents. Taken together, these new data provide a more positive picture of the District’s economy as the year drew to a close.

  • Income growth for DC residents is increasing.
  • Resident employment is rising and unemployment is falling.
  • Other sectors are picking up some of the slack in jobs and income from weakness in the federal sector.

Income in DC. The change in income is particularly striking. From the previous estimate it appeared that DC’s Personal Income growth was continuing to slow down in the 3rd quarter of 2017, falling to a rate of 2.2%. The new data raised the 2017.3 rate to 2.8%, which then jumped to 3.8% in the 4th quarter. Instead of a picture where income growth in the District continued to slow while the US increased at a faster rate, now DC’s Personal Income growth is estimated to be growing much closer to the national average.

graph 1


graph 2a     graph 2b    graph 2c

For DC residents, the turnaround is more pronounced for wages and salaries, which grew an estimated 5.5% in the 2017.4 quarter. This growth is consistent with recent collections for the withholding portion of DC’s individual income tax which have been very strong. For in the last quarter of 2017 those collections were up about 10% over the prior year. (It should be noted, however, that taxable DC income includes things like capital gains that are not captured in the income statistics; also, the recently enacted federal tax law complicates year-over-year withholding comparisons because, for example, some bonus payments may have been accelerated into 2017 that might otherwise have been paid in early 2018 so that corporations could reduce their 2017 corporate profits subject to 2017’s higher rates.)

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Changes in commuting patterns do not explain the recent upsurge in the wages of DC residents—in other words, DC residents are not capturing a greater share of the income earned in DC. To the contrary, the new data show that the commuter share of income earned in DC appears to have risen even faster than that earned by DC residents. Thus, in the 2017.4 quarter DC resident earnings grow by 4.1% while those earned by all persons working in DC rise 5.2%. This is a change from 2016 when resident earnings, though slowing down, still grew faster than all amounts earned in DC. (Earnings by this measure include proprietors’ income and benefits as well as wages and salaries, and the earnings of DC residents include amounts earned in the suburbs.)

table 1graph 4



Resident employment is rising and unemployment is falling. The new data show that resident employment increased by 1.5% from 2016.4 to 2017.4, no doubt a contributing factor to rising incomes of DC residents. The recent revision to the labor force data made a modest change to the end of year level of resident employment (a 0.3% increase of 976). The revision made a substantial change, however, to the picture of unemployment in DC. Whereas before it appeared that unemployment had increased by 1,479 from 2016 to 2017, the new data shows that it fell instead by 391. The primary reason for the decrease in unemployment, however, is that the revision reduced the amount of growth in the labor force while making little change in resident employment.

table 2

Picking up the slack. Revisions to the employment data made no material change in the number of jobs in DC at the end of the year (797,667, 200 less than previously estimated), or to the amount and rate of change (a 1% increase of 7,800, 133 more than previously estimated). The new data shows, however, that the federal sector lost 3,433 jobs from 2016, a 1.7% decline. Similarly, although federal wages grew by 3.1% from 2016 to 2017, this rate was little more than half that for the economy as a whole (5.7%). Although still by far the largest sector in the District’s economy, over the past year the federal civilian share of jobs slipped to 24.8% and its share of wages slipped to 30.5%.

table 3    table 4.PNG

table 4table 6

One of the positive elements in the new employment and income data is the extent to which other sectors of the economy seem to have picked up some of the slack resulting from weakness in the federal sector. On the job side, all other sectors of the economy grew 1.9%, faster than the US average of 1.6% for all non federal jobs. Wages of all other sectors of the economy grew 7.0%, faster than the US average of 4.7% for all non-federal wages and salaries.table 7.PNG

The new data show a shift in the composition of employment and wages in a way that, on balance, give a picture at the end of the year of increasing diversity in the industry mix of the District’s economy.

On the employment side:

  • 5,633 jobs were added to year-over-year employment change in four sectors: health, information, professional and technical services, and personal services. Instead of appearing to lose almost 200 jobs from 2016 to 2017, this group gained almost 5,500.
  • 4,900 jobs were cut from the year-over-year changes in jobs in three sectors: business services, food services, and education. (Even with the reductions, food services and education remain among DC’s leading sectors.)

At year end the leading non-federal sectors are summarized in the following table:

table 8

On the income side, the new data show particularly large gains in disbursements from a few sectors:

  • Almost three-quarters of the revised gain in wages in the 2017.3 quarter occurred in five sectors or subsectors: Information, real estate, management, arts and entertainment, and organizations and personal services. These five sectors accounted for only 17% of all DC wages in the last quarter of 2017.
  • Those five areas also accounted for 39% of all wage gains from 2016.4 to 2017.4.

At year-end the leading non-federal sectors for wage and salary disbursements are summarized in the following table:

table 9

About the data: The information is regularly reported information from the US Bureau of Labor Statistics (BLS) and the US Bureau of Economic Analysis (BEA). BLS publishes monthly statistics of wage and salary employment for the US and all states (including DC) and each March revises data from the prior years based on the availability of additional information. This analysis uses the amount for the years 2016 and 2017 as originally issued in December 2017 and the revised data for those years issued in March 2018. BEA issues Personal Income and other income statistics each quarter, often revising information from prior periods. This analysis uses the December 2017 release for 2016 and 2017 (through the 3rd quarter of the year) and the March 2018 release that revises prior data and includes the new estimate for the 4th quarter of 2017. Data used here may be subject to further revision by the agencies.

An earlier version of this blog was contained in the March 2018 District of Columbia Economic and Revenue Trends report.








From 2010 to 2017 net migration into DC was greater than that of 31 states

Housing demand and school enrollment are examples of how this migration has had an influence on the city’s economy

The Census Bureau estimates DC’s population was 693,972 as of July 1, 2017, an increase of 92,206 from the April 1, 2010 census. Although DC had more people than only two states in 2017, the amount of DC’s increase since 2010 was greater than in 19 states. In percentage terms DC’s 15.3% gain over the 7 years was almost three times the US average (5.5%) and greater than that in all 50 states. (The percentage gains in the 7 states with the most rapid increases in population—Colorado. Florida, Nevada, North Dakota, Texas, Utah, and Washington—ranged between 10.1% and 12.6%)

Net in-migration is the principal explanation for DC’s relatively rapid population gains. In other words, more people moved in than moved out.

  • Net migration into DC of 57,912 accounted for almost two-thirds (63.7%) of the city’s population increase.
  • DC’s net migration was greater than in 31 states. It represented a 9.6 % increase over DC’s total 2010 population, a higher percentage gain from migration than in every state except Florida (10.3%).
  • DC’s net migration was almost evenly split between international (47%) and domestic (53%).
  • The amount of net international migration into DC topped 14 states, but net domestic migration was even more striking: DC outpaced 35 states.

table 1

Migration also contributes to the part of DC’s population gain resulting from natural increase (which is births minus deaths).

According to the Census Bureau about one-third (36.3%) of DC’s population increase from 2010 to 2017 was due to natural increase. It should be noted, however, that many of the births that occurred in DC must have been to parents who migrated into the city during those seven years. In addition, the relatively young age of many migrants meant that few of them died in those years. In DC there were only 51.7% as many deaths as births over the period whereas for the US as a whole there were 66.1% as many deaths as births. Consequently, although DC had more births than only two states, the natural increase in DC’s population from 2010 to 2017 was greater than in 9 states.

Migration and age groups in DC. According to the economic forecasting company IHS Global Insight, 85% of the increases in DC’s population from 2010 to 2017 fell in two age groups: (1) 25 to 44 years and (2) under 15. Although migration can occur within any age range, these two age groups are closely tied to migration.

  • From 2010 to 2017 DC’s population between the ages of 25 and 44 grew by 54,071, a 26.3% increase that accounted for 58.6% of all growth in the city from 2010 to 2017. It is not possible to know how many of the additional 54,071 persons in this age group were migrants, but it can be no coincidence that this increase is close to the 57,912 net migration into DC reported by Census for the period. This age group is mobile and can easily move for employment reasons—and is also the age group most likely to have children.
  • From 2010 to 2017 DC’s population under 15 years of age grew by 24,436, a 29.2% increase slightly higher than that for the 25 to 44 age group. Accounting for 13.9% of the city’s population in 2010, children under 15 accounted for 26.5% of all growth from 2010 to 2017. Again, it is not possible to know how many of the additional children of this age either accompanied persons migrating to DC or were born to such migrants after they arrived, but surely many were.

The scale of the changes in migration and age groups that occurred between 2010 and 2017 would be expected to have many influences in the District’s economy, and this has been the case. For example, according to CoStar, a private sector firm that collects data on apartments and other commercial real property, from the first quarter of 2010 to the second quarter of 2017 there was an increase of 21,492 in occupied market rate apartment units in the District of Columbia. Similarly, enrollment in DC Public and Charter schools increased by 17,139 from the 2009-10 to 2016-7 school years, a 23.5% gain. Increases of these magnitudes in housing and school enrollments would not have been possible without the net in-migration experienced in DC from 2010 to 2017.

table 2

graph 1

The course of net migration will continue to have a great deal of influence on the the District’s economy. Migration is a net concept, meaning that it is the difference between those moving in and those moving out, so the questions surrounding migration have to do both with DC’s ability to attract new people and to retain those that are here.

According to Moody’s Analytics, an economic forecasting company, the nation’s population in the 20 to 30 age group is actually expected to decline over the coming years. From the first quarter of 2010 to the second quarter of 2017 there was a 22.6% increase in the 25 to 29 age group, whereas in the next five years Moody’s expects a 3% decline. To maintain its past inflow of young adults in this age group DC would therefore have to attract a larger share of the national total than was true of the past few years. In attracting people to DC an important question is also the city’s continuing ability to attract workers over 30 years of age who are not coming here for first or entry level jobs.

For retaining people who are here the key questions center on those 25 to 44 year-olds who have been at the center of DC’s recent population growth. What share of this age cohort will find sufficient job opportunities and housing options and secondary school options to keep them committed to staying in the District of Columbia?

There are, of course, many factors affecting migration into DC that are beyond the city’s control. These include developments in the national economy, federal spending policies that can make it easier or harder to find employment in DC’s key industry, and national policies affecting immigration that might reduce net international migration not only to DC but elsewhere in the country.

About the data.

This is the third of three blogs on DC population based on the December 2017 estimates of the US Census Bureau of DC population in 2017.

The population data for the District of Columbia for April 2010 and July 2017 are estimates from the US Bureau of the Census. The July 2017 data for DC and all of the states were released in December 2017 and contains an analysis of the components of natural increase and migration that explain the net changes in population from 2010 to 2017 for the US and for each jurisdiction.

Data on the age composition of DC population for the first quarter of 2010 and the second quarter of 2017 are estimates from the economic forecasting firm IHS Global Insight.

Changes in the 25-29 year-old age cohort in the US are from the economic forecasting firm Moody’s Analytics.

Data on occupied market rate apartment units in DC in 2010.1 and 2017.2 are from CoStar, a real estate information firm that tracks development in the District of Columbia and elsewhere in the nation.

Data on yearly enrollments in DC Public and DC Charter schools is from the DC Public Charter School Board.

An earlier version of this blog appeared in the February 2018 District of Columbia Economic and Revenue Trends report issued by the District of Columbia Office of Revenue Analysis, a component of the District of Columbia Office of the Chief Financial Officer.

Appendix table

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