We have a new year, a new General Assembly session, a new governor, a new election year and, conveniently, new sets of economic data. We’ll have plenty to debate in the weeks and months and years ahead, but we can at least try to start with a common set of economic facts. Here goes.
1. Employment growth in the U.S. has been sluggish for two years
January 2025 began with 163,381,000 people working. December 2025 ended with 163,992,000 working.
That’s an increase of 611,000, which sounds like a lot — and is if you’re one of those 611,000 — but on a percentage basis represents only a 0.3% increase.
Before you blame President Donald Trump, keep in mind that in 2024, Joe Biden’s last year in office, it only went up by 470,000, or 0.29%.
Employment grew a little faster under Trump, but not that much more, which suggests there might be some structural problems with the U.S. economy that neither president has been able to fix. We also could use more context here: If we go back to 2023, then employment grew by 1,031,000, or 0.6%. Put another way, employment in 2023 grew almost as much as 2024 and 2025 combined.
The question is whether 2024 represented the bottom year of a slowdown and 2025 marked a slight rebound — with better days ahead — or whether 2024 and 2025 together indicate we’re in a slower growth era. If you’re a Republican, you’ll argue the former. If a Democrat, the latter. Statistically, we won’t know for several more years yet, but politics moves faster than that.
2. Unemployment has been rising for two years — under both Biden and Trump
I’m wary of going back too far, or we’ll get into the pandemic years, which muck with statistics. However, in January 2023, the unemployment rate was 3.4% — 5,719,000 people unemployed. By December 2024, Biden’s last full month in office, the unemployment rate was 4.1% — 6,920,000 people unemployed. The year 2025 began with unemployment in January dipping to 4.0% — 6,865,000 people. By December 2025, unemployment was up to 4.4% — 7,503,000 people. These are relatively low percentages, historically speaking, but the trend line is worrisome.
Now that we’ve set the national picture, let’s look at Virginia.
3. Virginia’s employment was essentially flat in 2025
These statistics lag, so they only go through November. From January to November, the number of people working in Virginia increased only by 1,000, according to the Bureau of Labor Statistics — an increase of 0.02%.
By contrast, in 2024, Virginia’s employment grew by 67,900 from January to December. If you want a strict apples-to-apples comparison (ideally, Virginia-grown apples, of course), Virginia’s employment growth from January to November in 2024 was 53,700.
So why did Virginia see employment grow by just 1,000 in the first 11 months of 2025 when the year before it grew 53,700 in the same time?
4. Trump’s downsizing of the federal government virtually eliminated employment growth in Virginia in 2025
You’ll notice I’m not using the phrase that Virginia “added” so many jobs, but instead referring to how many people are actually employed. Virginia may have added lots of jobs in 2025, but it lost jobs, too, so we’re focused on the net.
So, back to the question: Why the big drop in Virginia between 2024 and 2025 when nationally we were seeing some modest job growth? There’s an easy explanation: The Washington metro area lost 52,900 federal workers, according to the Bureau of Labor Statistics. Of those, 12,200 were in Northern Virginia, according to Keith Water, assistant director of the Stephen S. Fuller Institute for Research on the Washington Region’s Economic Future at George Mason University. That represents a 12.8% decline in federal employment in Northern Virginia.
Without those job eliminations, Virginia’s employment growth in 2025 still wouldn’t have matched 2024, but it wouldn’t have been almost flat, either.
5. Federal employment in Washington is now the lowest it’s been in a quarter-century
The Fuller Institute at George Mason University says that federal employment in the D.C. area is now back to what it was in December 2001.
Some might cheer that. Smaller government! Yes! The swamp drained!
I’ll let others debate the wisdom and efficiency of those cuts. Instead, I’ll offer this perspective: The federal government is the dominant industry in Virginia’s biggest metro. When the dominant industry in our biggest economic engine undergoes such reductions, there are going to be economic ramifications, and we’re going to feel them across the state — because, as I repeatedly point out, rural school systems get most of their funding from the state, and the biggest source of that state funding is from Northern Virginia.
The federal workforce reductions won’t have the same effect on Northern Virginia that the collapse of the textile industry did on Danville and Martinsville, or the demise of coal did on Southwest Virginia, but the economic impact is a negative one (even if you think the cuts are a good thing overall).
No community can see its dominant industry lose 12.8% of its workers and get knocked back to 2001 employment levels without feeling something — and in this case, the whole state will, whether we like it or not.
6. Manufacturing jobs declined both nationally and in Virginia
Trump has championed a revival of manufacturing jobs, but that hasn’t happened. Manufacturing jobs in the country declined in 2025 — from 12,755,000 in January to 12,700,000 in November, a drop of 55,000 with a month’s worth of statistics yet to come.
Before we blame Trump, though, let’s remember that they dropped 166,000 under Biden in 2024.
The reality is that manufacturing jobs have been declining for decades — a function of both outsourcing and automation — and neither party has been able to check those trends. Manufacturing jobs peaked in 1979 under Jimmy Carter at 19,553,000 and bottomed out in 2010 under Barack Obama at 11,439,000, with three Republicans and one Democrat in between. They’ve come up a little since then, but after peaking under Biden in 2023 at 12,890,000, they’ve continued to slide. Both parties have promised manufacturing workers a renaissance they’ve been unable to deliver.
In Virginia, manufacturing jobs took a noticeable dive in 2025, from 240,200 in January to 236,100 in November, a drop of 4,100. We haven’t seen a one-year drop of that scale since the Great Recession, when manufacturing jobs in Virginia fell by 15,000 in 2009.
7. We often have a mismatch between worker skills and jobs available
A recent report on Southside Virginia showed the region had a surplus of manufacturing workers — but not enough health care workers. This is likely the case elsewhere, just at different scales. Simply because there’s an unemployed worker here and a job available there doesn’t mean they fit together.
8. Year-over-year, unemployment is up in all but one Virginia locality
That one exception is Emporia, which is down from 8.1% to 7.3%.
Some have gone steadily up in the past year; some have gone up and are now coming back down. Still, the bottom line is the same: All but one is higher than a year ago this time. (Well, by this time, I mean November, because those are the freshest stats available.)
9. The highest unemployment rates remain in Southwest and Southside
For all our focus on unemployment in Northern Virginia — which is important because of the region’s sheer size and role in the state’s economy — let’s not forget that the highest unemployment rates are in pockets of rural Virginia. Some of those counties are also seeing unemployment rise by much higher rates than elsewhere.
According to the most recent stats available on a locality basis, the highest unemployment in Virginia is in Emporia, which, as noted, is the only place where unemployment is down. Emporia’s 7.3% rate is down from 8.9% in August and lower than the 8.1% it was a year before.
Neighboring Greensville County is at 6.1%, down from 7.4% in August but up from 5.8% a year prior.
Buchanan County is at 6.2%, down from 6.4% in August, but still higher than the 4.2% it was a year ago.
These are by no means the only economic statistics available, but these do help establish some baseline facts. And now, let the political debates over them begin.