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Economist: Area will lead Va. out of recession

Fredericksburg region hit harder by current recession compared with those in the past, but still better off than most

Date published: 10/27/2009

BY BILL FREEHLING

The Fredericksburg area has weathered the recession better than most parts of the U.S., though the region has suffered worse than in previous downturns.

That was the message that keynote speaker Christine Chmura delivered yesterday to about 210 area business and government leaders at the Fredericksburg Regional Alliance's annual meeting.

"Your economy was hit a little bit harder than in the past because of the housing downturn," said Chmura, president of Richmond-based Chmura Economics & Analytics, during a luncheon at Fredericksburg's Jepson Alumni Executive Center.

Chmura added: "The Fredericksburg region is going to be leading the state out of the recession."

Chmura began her remarks by declaring that the U.S. recession likely ended in June or July, due in part to the huge volumes of automobiles sold under the Cash for Clunkers program. She predicted that slow growth will continue the rest of this year and next.

Virginia has fared better than the U.S. as a whole, and the Fredericksburg region has outperformed the state. She said that's due in part to the region's small percentage of manufacturing jobs and its gains in healthcare and government contracting jobs.

But the region has had a harder time than in past recessions, Chmura said, largely due to the sharp decline in housing construction. That's led to a drop in retail sales of home furnishings and building materials. Chmura predicts the resulting declines in sales tax revenues will make life tough for local governments over the next year or two.

Chmura noted that there are already signs of improvements in the local economy, however. Building permits for new homes are up, bucking the trend of most areas. The number of startup businesses are increasing. She expects modest job growth locally in 2010 and solid improvement in 2011 due to the 2,700 military jobs coming to the Quantico Marine Corps Base that year.

In summary, Chmura told the crowd, the area's proximity to Washington, lower cost of living compared with Northern Virginia, quality of life and skilled labor force bodes well for the region.

"You're in a very good region," Chmura told the crowd.

Bill Freehling: 540/374-5405
Email: bfreehling@freelancestar.com

Among the data Christine Chmura presented at yesterday's Fredericksburg Regional Alliance luncheon was the Fredericksburg Region Gross Regional Product. Here is the GRP, in billions of dollars, for the area (Fredericksburg, Caroline, King George, Spotsylvania, Stafford) since 2001, with Chmura's projections for 2009 and 2010. 2001: $5.58 B 2002: $6.29 B 2003: $6.76 B 2004: $7.30 B 2005: $7.99 B 2006: $8.70 B 2007: $9.80 B 2008: $10.07 B 2009: $10.13 B 2010: $10.28 B

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Date published: 10/27/2009

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