Northern Virginia economy driven by federal contracting, study says

WASHINGTON — If Northern Virginia were a state, it would rank second in the nation in the amount of money paid to local contractors by the federal government, according to a new study.

The five-year study by the Northern Virginia Regional Commission shows Northern Virginia would outrank all but California, based on the amount of non-payroll, defense and nondefense contracts being awarded.

The rest of Virginia, including the Hampton Roads area, would rank seventh in the nation.

According to the study, from 2010 to 2014, Northern Virginia received $219 billion, or 75 cents of every procurement dollar spent in the state.

About 90 percent of federal procurement spending happens in just 10 jurisdictions, with Fairfax and Arlington counties ranking at the top.

The list, in order:

  • Fairfax County
  • Arlington County
  • City of Newport News
  • City of Norfolk
  • Loudoun County
  • Prince William County
  • City of Alexandria
  • Virginia Beach
  • City of Portsmouth
  • City of Hampton

Federal procurement grew from $21.2 billion in 2000 to $54.9 billion in 2008, peaking in 2011 at over $60 billion.

With sequester-driven reductions in federal procurement, almost 90 percent of the $9 billion decrease from 2011 to 2014 has come from military spending.

In the study’s executive summary, the group projects: “For Northern Virginia, a one-third reduction in DoD procurement spending between 2014 and 2020 would reduce the projected baseline job growth of 149,420 jobs by 70,882 or by 47.4%. Eighty-five percent of this job loss would consist of jobs within the professional and business services sector.”

Neal Augenstein

Neal Augenstein has been a reporter at WTOP since 1997. Through the years, Neal has covered many of the crimes and trials that have gripped the region. Neal's been pleased to receive awards over the years for hard news, feature reporting, use of sound and sports.

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