The Washington region's economy has made a full recovery from the recession and has recovered nearly all the jobs it lost in the downturn, according to a new report.
However, the region's housing rebound, while steadier than the rest of the country, still has a long way to crawl before prices approach pre-recession levels, according to the MetroMonitor report released Monday by the Brookings Institution.
The region's gross domestic product, the total market value of all goods and services produced here, was nearly 9 percentage points higher during the fourth quarter of 2010 than it was at the last peak in early 2008 -- tops among the nation's metro areas. The region's GDP for all of last year totaled more than $400 billion.
| Region's economic recovery | |||
| Change from peak | U.S. rank | Average of top 100 regions | |
| Employment peak (2008, 2Q) | -0.7% | 2 | -5.3% |
| GMP peak (2008, 1Q) | +8.6% | 1 | +0.9% |
| Housing prices peak (2006, Q4) | -27.3% | 76 | -23.6% |
| Source: Brookings MetroMonitor | |||
Combined with an employment level that is almost equal to the last employment peak three years ago, the Washington region's economy is well ahead of other metro areas, experts said.
"If the recovery so far is an indicator of what it's going to be like in 2011, then it bodes pretty well for Washington," said Howard Wial, a Brookings fellow and author of the report.
Washington is second only to McAllen, Texas, a border city in the southeastern part of the state,
which has made a full employment recovery. However, McAllen's fourth-quarter unemployment rate of 12.1 percent is more than double Washington's 5.7 percent.
Because of its heavy reliance on government as an industry, Washington was spared the big bust suffered by metro areas that rely on real estate or the auto industry, the report said. Metro areas that rely on health care and education, like Baltimore, also have weathered the storm more easily.
As a result, Washington -- which has maintained relatively low unemployment through the recession -- didn't have as much to make up. But real estate locally, which hit a dramatic boom-bust, is lagging the rest of the local economy. Prices have bounced back by double digits since the bottom in mid-2009, but are still more than 25 percent below the market's peak, according to the report.
Although many are predicting this spring and summer will see big gains in real estate in Washington, Wial noted the "one fly in the ointment" for all parts of the economy is what happens to federal spending as lawmakers clash over budget cuts amid the threat of a government shutdown.
