publications | Economy

Chart of the week: The long view of the District’s labor market

June 02, 2023
  • Yesim Sayin
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For the nearly fifty years since Home Rule—except for a two-year period between 1979 and 1981, the eight-year period prior to the Revitalization Act, and the few months that followed the pandemic—the District’s labor force and resident employment has grown. This happened even during periods when the labor force-eligible population (non-institutionalized residents 16 and older) was declining.

The chart above tracks the growth in resident employment, the labor force, and the labor force-eligible population relative to where they were in 1976. Anywhere you see green shading are the periods when resident employment grew faster than the labor force.

Here are some key takeaways from this long-term view of the District’s labor market:

  1. At the time of Home Rule, the District was already losing population, including labor-force-eligible population. This loss generally continued until 1998 (the year of the Revitalization Act). Since then, labor-force-eligible population has been growing slowly. It finally returned to its 1976 level at the end of 2011.
  2. The pre-Revitalization Act declines in resident employment and labor force were particularly deep, but these metrics recovered faster than the labor-force-eligible population. Resident employment returned to its 1976 level in July of 2007, and labor force did the same in mid-2009. 
  3. Outside the two periods that follow the 1981-83 recession and the Great Recession, which officially began in 2007 and ended in 2009, the District’s resident employment grew faster than its labor force. For example, for a period of three years following the end of the Great Recession, the city was attracting new residents who joined the labor force at a rate faster than they found jobs.
  4. This dynamic changed around 2014, when the growth in resident employment was much stronger than the growth in the labor force. That is, the city was attracting new residents and most of them came already employed. Perhaps they moved because they found a job, or perhaps they already had a job in the region and relocated from the suburbs to the city. Because of this trend, labor participation in the District was its highest level (71 percent of all residents who were 16 or older were in the labor force).
  5. After the initial impacts of the pandemic, which lead to both job losses, and a lower level of participation in the labor force, we are once again in a period where resident employment is growing much faster than labor force. This is good news.  Unfortunately, the limiting factor here is the tepid growth in population, which results in a tight labor market. This is worth keeping an eye on.

Author

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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