Maryland’s jobless rate ticked down to 5.1 percent, down from 5.7 percent a year ago. Virginia’s rate, one of the lowest of any state, dropped from 4.8 percent to 4.5 percent.
Those percentages are a far cry from the years immediately after the recession, when jobless rates across the country climbed into double digits. But new jobs and falling unemployment doesn’t necessarily mean growth in the local labor market is accelerating.
“As baby boomers start to retire we’ve seen the growth in the labor market decline,” said Andy Bauer, a regional economist at the Richmond Fed.
To his point, the size of the civilian labor force dropped by almost 4,000 workers in Maryland since last year, and by a whopping 66,000 in Virginia over the same time period. The District’s labor force edged up only slightly.
Still, the types of jobs being added in the D.C. metropolitan area are making many analysts optimistic. The strongest sectors were education and health services, which added 24,300 jobs since this time last year, and professional and businesses services, which added 16,100 jobs in the same time period. Both sectors tend to be high-wage jobs with opportunities for advancement.
“Health services is hitting it out of the park in terms of job growth,” said Anirban Basu, chief executive of Sage Policy Group, an economic consultancy in Baltimore.
“One would think this is the result of the broadening utilization of health services by the newly-insured. This may by the effect of the Affordable Care Act, and it’s really supporting job growth in the D.C. metro area.”
Ths is the third jobs report in recent memory in which analysts have noted a surging market for jobs in healthcare. But the growth in professional services jobs, even as it came in second, raised even more eyebrows. This is the sector hit hard when the mandatory federal budget cuts took place a few years ago as part of the so-called sequestration process.
Anecdotal information captured in August by the Richmond Fed found that demand for employees went up particularly in specialized occupations like information technology, accounting and financial services.
Most of the region’s new jobs in this area come directly or indirectly from government money. If Congress orchestrates another government shutdown, growth in that sector will almost certainly be affected.
“Government is still the region’s biggest industry by far,” Basu said. “It’s a bit better-diversified than it was, but it’s still very dependent on federal activities, and an October government shutdown would ripple throughout the economy.