With thousands of recently cut federal employees now back in the job market, the D.C. area’s economy is going to be severely impacted.
The D.C. Department of Employment Services, which coordinates unemployment insurance filings, is already reporting a sharp increase in the number of people filing for unemployment.
“There has been no time in our modern history where you’ve talked about a disruption of federal employment on the scale that we’re talking about at the moment,” said Terry Clower, director of the Center for Regional Analysis at George Mason University.
The exact scale of the federal firings isn’t known, but at the current pace, Clower predicts an ongoing negative impact on the local economy.
“We could reasonably see two or more jobs total go away for every one of the federal jobs,” Clower said, referring to the impact on federal contractors and other groups directly supporting federal government agencies.
Relative to the overall local economy, Clower said: “For every federal job we lose in this region, we will lose about 0.4 jobs elsewhere in the local economy, just because of the reduction of household spending.”
Clower said the burden is now on state and local governments to step up with resources to help federal employees transition to other available jobs.
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