(This column first ran in the Richmond Times Dispatch on March 5, 2012)
Now that the economy has started growing, the next question becomes when will we return to the employment levels prior to the Great Recession?
Not until 2015, according to the Greater Richmond Partnership, a public-private regional economic development organization that used projections from the Virginia Workforce Commission. And it may take until 2018 for some sectors in the Richmond economy to recover all the job losses, the partnership says.
Employment in the Richmond metropolitan area peaked in June 2007 at 634,900.
Two years into the recovery, the number of jobs slid to a new trough of 594,600 in June 2011, representing about 40,300 jobs lost. As of December 2011, employment in the metro area inched up by 3,700 since June. That still leaves 36,600 jobs to go.
As a point of comparison, the Richmond metro area shed about the same number of jobs as the total number of people employed in the Danville metro area (or about 39,590 people).
A few sectors, such as health care and education, continued to add jobs through the recession. Others, including professional business services and leisure, started to add jobs in 2011. Sectors that were hit particularly hard during the recession, such as finance and insurance, are not expected to regain the jobs lost for another five years, according to the Greater Richmond Partnership’s projections.
The latest data show that finance and insurance firms employ 6,200 fewer people than when the recession started. Even harder hit sectors as retail, construction, real estate, and manufacturing are not expected to see pre-recession employment levels until 2018.
With the continued sluggish growth in housing, it’s not surprising that the largest job deficit remains in construction — it is employing 14,000 fewer people.
Although the analysis is discouraging, it may be overestimating the time to recovery.
It did not take into account any of the new expansions into the region such as the 1,350 jobs that Amazon.com will bring when it opens two large distribution centers and the hundreds of new jobs at Health Diagnostic Laboratory downtown.
The information also relied on projections created a few years ago when economic conditions were not as favorable and probably relied on less optimistic assumptions.
Even though the recession was particularly deep in the Richmond metro area, a June 2011 report by the U.S. Conference of Mayors put Richmond’s projected time for recovery about in the middle of 363 metro areas in the country.
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