Arlington, Texas 2021-01-14 14:15:44 –
The pandemic has hit Arlington’s economy, but the county may be in a good position for a rebound fairly quickly.
In a virtual panel discussion hosted by the 100-member Arlington Commission, the second in a two-part series, local experts said that unlike the past recession that brought about a long-term recovery, this is a structural economy. He said it was caused by a virus rather than a factor.
“The current economy is responding to the health crisis and [that] It’s driving the recession, “said Janet Chapman, economist and director of the Stephen Fuller Institute at George Mason University. “This is not a normal recession.”
The pandemic has significantly reduced personal consumption. Compared to this time last year, credit and debit card spending in Arlington has fallen by nearly a quarter (nearly 30% lower than DC).
But that’s an improvement from early spring, when overall spending fell by about 50%.
As expected, spending declines were primarily concentrated in the transportation, apparel, hotels and food service industries. Food and grocery spending increased in 2020.
While unemployment continues to be a concern, northern Virginia is above the national average. This is “mainly because it is a knowledge services economy and can send most of the workers home,” Chapman said. [to telework].. As expected, the majority of unemployment is in the leisure and hospitality sector, accounting for almost one-third from November 2019 to November 2020.
“Leisure and hospitality jobs tend to have lower wages,” says Chapman. “These jobs have been hit hardest.”
In general, Chapman says losses are locally biased towards low-paying jobs. However, because the recession is due to the health crisis, Chapman said the vaccine has become widely available and can be expected to recover almost completely by 2022.
Arlington’s SMEs, especially those that rely on face-to-face interactions, are also heavily affected.
Terry Tucker, director of economic development at Arlington, said that any company with less than 50 employees is defined as a “small business.” This includes about 90% of the county’s business, or 6,000.
Over the last decade, the county and federal government have implemented various programs and grants. And that seems to be helping, Tucker said.
Arlington’s SME Emergency Grant provided a total of $ 2.7 million to nearly 400 businesses. More than half of those businesses were owned by women and / or minorities.
For large companies, Tucker also talked about how office building vacancy rates actually declined from a high of over 20% in 2015 to 2020.
Since then, the vacancy rate has risen to 16.3%, which is below the office vacancy rate in the mid-2010s. Commercial real estate, such as office buildings, is the county’s main source of tax revenue, according to Tucker.
In addition, over the last five years, many large multinationals have built homes in Arlington. This includes Microsoft, which announced last week that it will be a key player in Roslin.
The presence of Amazon and other major companies could spur increased employment in Arlington, as well as the expected increase in federal spending under the Biden administration.
Meanwhile, Arlington’s housing market is strong. According to Tucker, homes are usually sold at prices 3% to 5% higher than the listing price, which is a positive sign.
“Many social programs [the county] Provided through the Department of Health and Human Services … Money generated from both our housing and business taxes not only helps pay for these programs, but also ranks our school system nationwide. It helps, “said Tucker.
He also said the county has already talked about making it easy to convert vacant office space into homes, especially on Columbia Pike and Lee Highway (which may soon be renamed Rubbing Avenue). Stated.
Both Tucker and Kate Bates, presidents of the Arlington Chamber of Commerce, talked about how hard the hospitality community has been hit in Arlington.
Some companies allow employees to work from home, but those workers do not leave the office for lunch at a nearby restaurant. “”[Restaurants and retailers] It depends on the amount of traffic on foot, “says Bates.
According to Bates, occupancy rates at many local hotels were “nearly zero,” and many wanted guests associated with next week’s inauguration. This year will look very different.
This could affect real estate valuations mailed this week, but Tucker said hospitality was “fortunately only about 2% of the county’s land prices.”
Even in the hit restaurants and retail sector, the aggressiveness remains. Prior to the pandemic, SMEs recognized the need to move from relying solely on face-to-face business to executing more transactions online.
“I think our retailers and restaurants are some of the most innovative and adaptable people I know,” says Bates. “So I have all the confidence in the world in their ability to pivot to what is most effective for them.”
Another good news: Economists surveyed by The Wall Street Journal are revising US economic growth forecasts by 2021. According to the survey, economic growth is expected to grow by 4.3% this year, up from 3.7% in last month’s survey.
Arlington is Well Positioned for an Economic Recovery, Say Local Experts Source link Arlington is Well Positioned for an Economic Recovery, Say Local Experts