At year's end the region's economy is in high gear. Job growth remains strong, the private sector is brimming with confidence and local government officials are boasting of budget surpluses.

The D.C. Department of Employment Services recently reported that metropolitan Washington's economy gained a net 68,800 jobs between October 1998 and October 1999, for a solid 2.7 percent growth rate.

And for the first time in nearly a decade, Employment Services officials said, the unemployment rate in the District fell below 6 percent, dropping to 5.7 percent in October. For all of metropolitan Washington, the jobless rate was just 2.5 percent.

More than 36,000 jobs were created this year, primarily in business, engineering, management and health services. Trade accounted for another 7,500 and construction, 6,000.

The question is, where do we go from here? How long will these economic trends continue into the new year--and into the next decade?

The more compelling question, perhaps, is what sector will emerge as the primary engine that drives economic growth here during the next 20 years and beyond?

The answer, of course, is the federal government. It is the one constant in the area's economy and has been for more than a century. Clearly, expansion of the federal bureaucracy during the New Deal and World War II were major factors in the growth of the nation's capital and the population spillover in close-in suburbs.

Similarly, sharp increases in defense spending during the Cold War fueled growth in the suburbs, where legions of defense contractors set up shop, adding another dimension to the economy.

Thus, whether in war or in peace, the federal government has been the main engine driving the local economy's growth.

For years, local business leaders and others boasted that the area's economy was recession-proof. But after the 1990-1991 recession they were forced to concede--grudgingly, perhaps--that the local economy was only recession-resistant.

That notwithstanding, metropolitan Washington was in a better position than most areas to withstand the shock of a recession. Some industries tend to be cyclical in nature, but the federal engine keeps turning, spending billions of dollars in the local economy for goods, services, salaries, pensions and the like.

No industry has had a greater impact than the government on population growth and economic expansion locally. But the perception of Washington as a "government town" tends to distort the fact that the local economy is also supported by a strong private sector.

While it's true that many companies have established a presence in the area to lobby or do business with the government, others are here to take advantage of opportunities in the private sector, including tapping the country's fourth-richest consumer market.

The composition of the area's private sector has nonetheless changed dramatically since the mid-1980s. Of the 10 largest local banks that were in business 15 years ago, only Riggs National Bank remains. Like the 30 or more local banks and savings and loans that have disappeared in the interim, retail fixtures, including the Woodward & Lothrop department store chain and Hechinger Co., have been wiped out by mergers and failures.

The void in banking and retailing has been filled by out-of-state companies and chains. But the merger trend continues--in the commercial real estate services industry, telecommunications and among Internet service providers.

Meanwhile, the transportation, public utilities, finance, insurance and real estate sectors have not shown much robust job growth recently. So the question remains: Where are we likely to find the main engine for the local economy in 2000, 2020 and beyond?

Some would argue that it will come from the area's technology companies, primarily those in the information-technology sector. After all, the high-tech industry has created jobs faster than any segment in recent years, and continues to do so.

Still, the area's high-tech firms are here primarily because the federal government provided the infrastructure, resources and synergy that fueled their growth.

Like all government contractors, most big law firms, accounting firms and trade associations that have a presence in the area, the bulk of technology companies are here because they perceived a need to be near the seat of government or other companies that do business with the government.

Even so, the combination of federal employment, contracts for goods and services, outlays for pensions and the continual deployment of federal agencies throughout suburban Maryland and Northern Virginia is a tremendous asset to the local economy.

Thus the government is really the straw that stirs the drink in the local economy. It always was and always will be--as long as the nation's capital remains in Washington.