publications | Business Conditions, Economy, Regional Dynamics, Remote work

Chart of the week: D.C. has a smaller share of the region’s service-sector jobs now than pre-pandemic, a bellwether of continued economic distress

April 28, 2023
  • Bailey McConnell
  • Yesim Sayin
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The pandemic accelerated labor market shifts that present new challenges and risks to large metropolitan areas like the D.C. region. When it comes to attracting talent, D.C. not only competes with neighbors like Arlington, Fairfax, and Montgomery Counties, but also large and small cities across the country. This has always been the case, but now, workers and businesses alike are increasingly mobile thanks to the rise of remote work.

Traditional job data do not account for where workers are working. This can obscure where labor market recovery is taking place. Typically, jobs are counted based on where an employer is located. For example, an establishment in D.C. that employs 10 workers contributes 10 jobs to D.C.’s labor market, regardless of where those workers live. But if office workers are working from home, traditional employer-based data only capture these workers when they are in-office. Accordingly, a city can job activity without losing jobs.

To better understand shifts in the labor market due to remote work, we focus on job activity—a term we’ve coined capture the spread of regional jobs based on where workers are actually working—by using the U.S. Census Bureau’s American Community Survey (ACS) data on worker-reported place of work by occupation.

Next week, the D.C. Policy Center’s Alice M. Rivlin Initiative for Economic Policy & Competitiveness will publish a report “Job sprawl in the Washington metropolitan area: Is D.C. still the region’s job hub?” The report explores how job activity is shifting and what it means for the District’s competitiveness in the region. We found that significant portions of job activity has moved to suburbia and exurbia in occupations where employers can work remotely. Importantly, when this happens, other types of job activity follow them.

In the long-term, service-oriented jobs will follow economic activity and businesses may no longer be able to justify the costs of being in D.C. if their workers are elsewhere, further depressing office demand.

This chart of the week is excerpted from our forthcoming report, Worker sprawl in the Washington metropolitan area: Is D.C. still the region’s job hub?, available May 1, 2023.

Authors

Bailey McConnell

Former Research Director, Rivlin Initiative
D.C. Policy Center

Bailey McConnell is Research Director for the D.C. Policy Center’s Alice M. Rivlin Initiative for Economic Policy & Competitiveness. In this role, she assists with the management and implementation of the Policy Center’s economic and competitiveness research. Prior to joining the D.C. Policy Center, Bailey worked as a Research Analyst in the Washington, D.C. office of HR&A Advisors, a real estate consulting firm. She has also worked as an Legislative Intern with the House Committee on Energy and Commerce and as an Economic Opportunity and Financial Inclusion Intern with the National League of Cities. 

Bailey is originally from Pittsburgh, Pennsylvania and holds a bachelor’s degree in Economics from Boston University. 

You can reach Bailey at bailey@dcpolicycenter.org.

Yesim Sayin

Executive Director
D.C. Policy Center

Yesim Sayin is the founding Executive Director of the D.C. Policy Center.

With over twenty years of public policy experience in the District of Columbia, Dr. Sayin is recognized by policymakers, advocates and the media as a source of reliable, balanced analyses on the District’s economy and demography.  Yesim’s research interests include economic and fiscal policy, urban economic development, housing, and education. She is especially focused on how COVID-19 pandemic is changing regional and interregional economic interdependencies and what this means for urban policy. Her work is frequently covered in the media, including the Washington Post, the Washington Business Journal, the New York Times, the Wall Street Journal, WAMU, and the Washington City Paper, among others.

Before joining the D.C. Policy Center, Dr. Sayin worked at the District of Columbia Office of the Chief Financial Officer leading the team that scored the fiscal impact of all legislation the District considered. She frequently testified on high profile legislation and worked closely with the executive and Council staff to ensure that policymakers fully understand the fiscal implications of their proposed legislation. Yesim also has worked in the private sector, and consulted with international organization on a large portfolio of public finance topics.

Yesim holds a Ph.D. in economics from George Mason University in Fairfax, Virginia, and a bachelor’s degree in Political Science and International Relations from Bogazici University, located in Istanbul, Turkey. 

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