13 Economic trends

This chapter shows Virginia’s major economic trends over the past decade. Jobs, wages, household incomes, and poverty rates all help explain the financial health of Virginians, which determines their ability to find housing that meets their budgets.


Major takeaways in this chapter include:

  • Despite strong growth in the face of two major recessions, new economic opportunities in Virginia are not equally distributed.
  • Jobs rebounded quickly in metropolitan areas following the Great Recession and COVID-19 pandemic, but total employment levels in rural Virginia have consistently declined since 2008.
  • Black and brown Virginians suffered a much higher rate of pandemic-related job losses compared to white Virginians. They also consistently have below-average household incomes.
  • Many of the state’s fastest-growing job sectors, such as healthcare support occupations, command below-average wages. These workers will have less income available for rent or mortgage.
  • Employment and income trends are exacerbating inequality: Projected job growth is in occupational sectors with widely disparate earnings, and wage growth remains concentrated in already high-earning occupations and regions.

13.1 Labor force

Finding 1: Virginia’s metro areas account for all job growth over the past two decades.

Rural Markets never recovered from the Great Recession.

FIGURE 13.1: Change in total employment

The Commonwealth added almost 900,000 new jobs from 2000 to 2020. During that time Virginia lost 200,000 jobs to the foreclosure-driven Great Recession from 2008 to 2010. Most of Virginia rebounded after the downturn; the state added 60,000 new jobs each year on average between January 2010 and February 2021. But in March 2021, Virginia entered lockdown in response to the spread of COVID-19. Job losses were immediate and historic, exceeding 400,000 within weeks. However, a large number of those jobs returned over the past year.

While Large Markets saw the highest job growth levels, their Small Market counterparts were not far behind. Prior to the pandemic, these areas had 20 percent more jobs than in 2000. Rural Markets saw stagnant growth in the 2000s followed by steady declines after the Great Recession.

Finding 2: Since the start of the pandemic, Rural Housing Markets and some Small Metro Housing Markets have fared better with job recovery.

Large Metro Housing Markets—and some Small Metro Housing Markets—are still well below pre-pandemic employment levels.

FIGURE 13.2: Pandemic job recovery

Economic recovery has been uneven across the state since the lifting of initial state-level pandemic restrictions and the rollout of the state’s vaccination effort. The Northern Shenandoah Valley/ Winchester Metropolitan Statistical Area (MSA) and the Chesapeake Bay are two areas seeing the fastest return to pre-pandemic employment levels. Regions recovering more slowly include otherwise healthy metro markets such as Richmond and Charlottesville as well as remote areas like the Alleghany Highlands.

Overall, the three Large Markets are still far from full recovery. Small Markets and Rural Markets vary; some are faring better than their more populous counterparts in the urban crescent, but as of June 2021, others still have employment levels that are down about 10 percent from pre-pandemic levels.

Finding 3: Despite recent recovery, rural Virginia still has higher unemployment levels.

Non-metro areas may have fared better over the past year, but they have not recovered from pre-pandemic job losses.

FIGURE 13.3: Unemployment rate by market name

Virginia enjoyed low unemployment rates across most of the state prior to the pandemic and its economic fallout. Many lost jobs now have been restored and filled, and the statewide unemployment rate is 4.5 percent as of June 2021.

Across the state, nearly all markets are within a point of this state average. Within the urban crescent, Hampton Roads and Richmond have higher unemployment than Northern Virginia. Unemployment in Small Markets is relatively low except for the Lynchburg area. Every Rural Market has unemployment above the state average, especially Southside at 5.5 percent.

Finding 4: Non-white Virginians experience unemployment at much higher rates.

Pandemic job losses in 2020 hurt Virginians of color the most.

FIGURE 13.4: Unemployment rate by race and ethnicity

Unemployment across Virginia is not equally distributed across race and ethnicity. Nearly a decade ago, the 10 percent unemployment rate for Black Virginians was almost double the rate for white Virginians. Unemployment for Hispanic Virginians varied prior to the pandemic, but generally exceeded the rate for whites. Asian Virginians experienced the lowest unemployment rates among major race/ethnic groups.

The unemployment situation is fluid as the pandemic recovery continues, but based on available 2020 averages, Virginians of color lost jobs at a much higher rate than white Virginians. Black and Hispanic unemployment soared above nine percent, and Asian unemployment was not far behind, but the white unemployment rate barely exceeded five percent.

13.2 Jobs and wages

Finding 1: Customer-service jobs are the most common positions filled by workers in Virginia.

These workers have been front and center during the pandemic.

FIGURE 13.5: Ten most common jobs in Virginia in 2010 and 2020

Retail salesperson, cashier, and food service worker remain in the top five most common occupations in Virginia. These relatively low-pay positions have been a policymaking focus as communities reopen and restart their economies. Other common positions that have stayed in the top ten are office clerk, customer service representative, janitor, stocker, and general manager.

Software developer, a traditionally higher-earning role, emerged as the fourth most common job in the state by 2020. However, the “software developers” occupation code did not exist in 2010 so jobs in that category likely were classified under other codes.

Finding 2: The fastest growing job groups are a tale of two income brackets.

The two fastest growing sectors have low wages while others in the top five pay well.

FIGURE 13.6: Wages for top five fastest growing job sectors

Since 2010, the two fastest growing sectors have been healthcare support and transportation and material moving. As of 2020, the median annual wages for all jobs in both categories were well below $35,000. At the same time, Virginia saw strong growth in three other sectors: life, physical, and social science; business and financial operations; and computer and mathematical. Positions in these categories are more likely to require advanced degrees and additional training and correspondingly command higher salaries ranging from $79,240 to $102,840.

Finding 3: Future jobs in Virginia will focus on computers, food, and healthcare.

These important positions have a wide range of salaries.

FIGURE 13.7: Job sectors with highest projected growth

The Virginia Employment Commission expects the Commonwealth to add more than 260,000 new jobs between now and 2028. Nearly every major occupational sector will see increases, but the top eight are shown above. High-tech computer-based jobs will see the greatest net increase followed by food preparation and service. Though a diverse economy requires that both are strong sectors, their average wages and educational requirements contrast significantly.

The personal care and service, healthcare practitioners, and healthcare support sectors are all projected to grow significantly. The state’s aging population will contribute to the increase in demand for these services.

Finding 4: Wage growth has been highest in some of Virginia’s already highest-earning localities.

Average annual pay increased by nearly $20,000 in some places over the last five years, but others saw much smaller growth.

FIGURE 13.8: Average wage growth

Virginia’s robust economic growth prior to the COVID-19 pandemic led to wage growth in nearly every locality across the Commonwealth. However, that extra take home pay was concentrated mainly in already higher-earning localities in Large Markets, such as Goochland, Arlington, and Fairfax counties.

Counties like Arlington and Fairfax have many high-earning residents largely because the headquarters of major companies and organizations are located in Northern Virginia, as well as the large federal workforce. Fairfax County-based employers include Freddie Mac, General Dynamics, Capital One Financial, and Hilton Worldwide Holdings.

Within Arlington County is Amazon’s HQ2, an expansion of their Seattle, Washington corporate headquarters, as well many other corporate, financial, and government contracting jobs.

Goochland County, just west of the city of Richmond, also has several large high-paying companies with major footprints. These include the Capital One West Creek campus, CarMax headquarters, and the Luck Stone Corporation.

Some Small Markets, including Charlottesville and Albemarle County, experienced significant average wage increases. The lowest-earning localities in Small Markets—those with average annual wages near or below $40,000—generally saw the smallest growth in take home pay as did the lowest-earning localities in Large Metro Housing Markets.

In nearly every locality in Rural Markets, average annual wages do not exceed $40,000. While most wage increases since 2015 were modest, some localities saw relatively high gains, particularly Northumberland County on the Northern Neck.

Finding 5: Wage growth is not the same across all industries.

Higher-paying industries are seeing the greatest wage increase.

FIGURE 13.9: Average annual wage by industry

Jobs in information, finance, and professional services have the highest-paid workers in the Commonwealth. However, the salaries for these occupations vary widely depending on market area. In the Large Markets, such jobs pull in well over $80,000 a year, but similar positions in the same industries command two-thirds to half of that in other parts of the state.

Scarce natural resource and mining jobs are the highest-paying occupations in Rural Markets, with average wages of approximately $55,000 in October 2020. Aside from these few well-paying jobs, most industries in rural areas have similar average wages to each other—largely ranging between $47,000 for financial activity jobs and $39,000 for education and health services jobs.

Wages for the lowest-paying industry—leisure and hospitality—are the most compressed across the market groups. Many jobs in this sector pay at or slightly above the minimum wage, and many have less than full-time hours. However, the second quarters of 2020 show notable relative wage increases for these jobs. This may be due in part to employers offering higher wages to entice workers back to their jobs during reopening phases.

13.3 Household incomes

Finding 1: Black Virginians make significantly less money.

There are major income disparities between Black households and other racial and ethnic groups in Virginia.

FIGURE 13.10: Median household incomes by race and ethnicity

Incomes for all racial and ethnic groups have been on a steady rise over the past decade, but disparities in income have persisted. Income inequalities between racial groups will continue to perpetuate disparities in housing if not addressed.

In 2019, the median Black household income was only $53,896, while White, non-Hispanic households made roughly $30,000 more than that, and Asian households made over 50 percent more than Black households.

There are wide disparities in income between different Asian origin groups. In the U.S., Indians had a median household income of $119,000 in 2019, compared to $70,000 for Vietnamese households and $44,000 for Burmese households.22

When looking at data on Asians or Hispanics, it is important to keep in mind that “Asian” and “Hispanic” or “Latino” are panethnic terms—meaning that multiple ethnicities are grouped together based on a commonality such as geographic area or language.

The experiences of people of different countries of origin often vary dramatically, despite being grouped under the same pan-ethnic label.

Nuances do exist across the Commonwealth, with the widest income disparities occurring in Northern Virginia. But Black households and Hispanic households are consistently represented at the low end of median household income.

FIGURE 13.11: Local median household incomes by race and ethnicity

Finding 2: Incomes across the Commonwealth are unevenly distributed by tenure.

The majority of owner households make over $75,000 while most renters make less than $50,000.

FIGURE 13.12: Household income distribution by tenure

The share of renters and owners making higher incomes increased from 2010 to 2019. But those increases have not been evenly distributed; homeowner incomes have continued to skew towards $100,000 or more while renter incomes only reach the $50,000 to $74,999 range.

Although there has been a rise in the number of renters making higher incomes, there still remains a significant number of renters who are making less than $15,000. These renter households continue to be in high need of assistance to make their way out of poverty.

13.4 Poverty

Finding 1: Black Virginians experience poverty at a disproportionately high rate.

White and Asian Virginians have the lowest poverty rates.

FIGURE 13.13: Poverty rate by race and ethnicity

Compared to the overall poverty rate of Virginia, many people of color experience poverty at a much higher rate. From 2010 to 2019, nearly one in every five Black Virginians was below the Federal Poverty Level. The poverty rate of Black Virginians in 2019 (18 percent) was over two times that of white, non-Hispanic Virginians (8 percent) and Asian Virginians (7 percent). Hispanics also experienced relatively high poverty rates (14 percent)—three percent points above the overall Virginia poverty rate of 11 percent.

These poverty rates have major equity implications for Black and Hispanic Virginians. As these disparities in poverty have persisted for over a decade, the need to address the economic conditions of people of color in Virginia is a critical path to racial equity.

Finding 2: Young people below 24 years of age are more likely to experience poverty in Virginia.

While the poverty rate among all age groups has remained steady, young Virginians are disproportionately represented in poverty.

FIGURE 13.14: Poverty rate by age

Compared to any other age group, Virginians under 24 years of age experience poverty at disproportionate rates. In 2019, 14 percent of the population under 18 and 20 percent of 18 to 24 year olds were below the Federal Poverty Level, while all other age groups had a poverty rate below 10 percent.

The low number of seniors in poverty can be attributed to federal assistance programs such as Medicare and Social Security Income, while the 25 to 44 and 45 to 64 year old age groups have a high proportion of working adults. However, the under 18 population with a 14 percent poverty rate shows a high need of support for families with children in poverty.

The 18 to 24 year old age group consists of a high number of college age students who technically meet the poverty criteria, but are not living in actual poverty because they are receiving familial support that is not counted as income.

For context, the presence of college students living off campus has the ability to increase poverty rates in localities with large or multiple universities by 10 or more percentage points.23 24

Finding 3: Asset Limited, Income Constrained, Employed households are growing outside of Large Metro Housing Markets in Virginia.

While Asset Limited, Income Constrained, Employed (ALICE) households are decreasing overall, the number of ALICE households is increasing in Small Metro and Rural Housing Markets.

FIGURE 13.15: Asset Limited, Incomed Constrained, Employed (ALICE) households

ALICE is a term increasingly used to describe households that earn above the Federal Poverty Level but are unable to afford the basic necessities to live comfortably. These households often do not qualify for assistance programs because they do not meet the income requirements. In 2018, just over 900,000 households in Virginia qualified as ALICE.

While Virginia’s statewide number of ALICE households has decreased in recent years, the rate is not consistent across regions. ALICE households have been increasing in Small and Rural Markets in Virginia where households often live in areas where basic necessities are not easily accessible.