How the federal government shapes job markets beyond D.C. – in Honolulu, Virginia Beach, and across the Sunbelt.
During the government shutdown this October, the country turned its eyes to Washington, D.C. in two very different respects – both for its political circus, and for the stories of thousands and thousands of federal workers who were temporarily put out of work.
But the shutdown also made clear how the fortunes of many places across the country outside of Washington, D.C., turn on the federal government. I recently wrote about the federal government’s role in greater Washington D.C.’s knowledge economy.
Today, I broaden this analysis to turn to the nation as a whole, posing two questions:
- How pervasive is the federal government's role across the economic landscape of the U.S.?
- And, which metros have the highest and lowest shares of federal government jobs?
To get at this, I asked the analysts at the labor market data and research firm EMSI to extend their analysis of the greater D.C. economy to the nation’s 100 largest metros, measuring both the direct number of federal government jobs and the indirect multiplier effects of the federal government on these metros’ workforces. The Martin Prosperity Institute's (MPI) Zara Matheson mapped the data.
The map above charts the share of federal government employment for America’s 100 largest metros. In general, the green-shaded areas of the map run through the Sunbelt, reflecting the higher concentration of federal government employment there. The blue and dark green areas of the map, where there are the highest concentrations of federal workers, largely reflect the geography of major military installations: Virginia Beach’s Naval Station Norfolk, Honolulu’s Pearl Harbor, and Colorado Springs’ Peterson Air Force Base. This military emphasis also extends to the Baltimore metro area (which includes Annapolis’s U.S. Naval Academy), San Diego (Naval Base San Diego), and Ogden, Utah (Hill Air Force Base).
Of course there is an understandably large concentration of federal employment around greater Washington, D.C. However, the D.C. metro – with 14.1 percent of its workforce made up of federal employees – actually ranks fourth in terms of the share of its workforce made up by the federal government. Topping it are Colorado Springs (with a 16.4 percent federal share), Virginia Beach (16.1 percent), and Honolulu (15.4 percent).
In addition, federal government workers made up ten percent or more of all employment in three additional metros: Ogden-Clearfield, Utah (11.1 percent); El Paso (11 percent); and San Diego (10 percent). And federal employment comprised between 5 and 10 percent of all jobs in an additional ten metros: Augusta, Georgia; Baltimore, Maryland; Charleston, South Carolina; San Antonio, Texas; Oklahoma City, Oklahoma; Dayton, Ohio, Columbia, South Carolina; Jacksonville, Florida; Tucson, Arizona; and Albuquerque, New Mexico.
On the flip side, the metros with the smallest concentrations of federal employment are largely in the Frostbelt areas of the Northeast and Midwest. The metros of the dense, blue state corridor from Philadelphia through New York and north to Boston have relatively lower levels of federal government employment – all below 3 percent. The same is true of much of the Rustbelt, as Detroit, Milwaukee, and Minneapolis all have less than 2 percent of their workforces in federal employment. In three metro areas, just one percent of the workforce is employed by the federal government: Bridgeport, Connecticut; Lancaster, Pennsylvania; and Grand Rapids, Michigan. There are also lower levels in bigger metros like Los Angeles (1.3 percent), Houston (1.5 percent), and San Francisco (1.8 percent) as well as New York (1.6 percent), Boston (1.9 percent) and others. Surprisingly, perhaps, we find relatively low levels of federal employment in noted tech hubs like Silicon Valley’s San Jose metro area (1.3 percent) and the North Carolina Research Triangle around Raleigh-Cary (1.5 percent).
The map also reflects the spiky nature of federal employment, with hugely outsized importance in just a small number of metros. Fewer than 20 metros of the top 100 metros have more than 5 percent of its workforce in the federal government.
The table below, also based on EMSI data, lists the ten metros (of the nation’s 100 largest), with the highest levels of federal government-associated jobs, combining both direct federal employment and their indirect multiplier effects.
|Top Ten Metros with Most Direct and Indirect Federal Government Employment|
|Metro||Percent of Employment|
|Virginia Beach-Norfolk-Newport News, Virgina-North Carolina||42%|
|Washington-Arlington-Alexandria, D.C.-Virginia-Maryland-West Virginia||36%|
|Colorado Springs, Colorado||32%|
|El Paso, Texas||32%|
|San Diego-Carlsbad-San Marcos, California||25%|
|San Antonio-New Braunfels, Texas||19%|
|Augusta-Richmond County, Georgia-South Carolina||18%|
When we combine the indirect and direct effects of federal employment, Washington, D.C., rises slightly to third, with 36 percent of its workforce tied to the federal government. But, again, it is bested by Honolulu and Virginia Beach, which both have more than 40 percent. There are seven large metros where the multiplier effects plus direct employment contributes more than one in five of all regional jobs.
Again note the prevalence of Sunbelt areas. Baltimore and Poughkeepsie are the only Northeastern metros to make the top 20, according to EMSI’s analysis of the direct and indirect employment impacts of the federal government.
In many ways, this map and table align closely with the regions that economist Ann Markusen and her colleagues dubbed America’s “gunbelt” – the wide swathe of the country totally remade by defense industry investments during the middle of the 20th century. This geography is the product of the federal government’s military spending and the geography of military bases and installations that was laid in place in the high Cold War years. In fact, the map of high levels of government employment today looks eerily similar to it, as it continues to shape the geography of government jobs we are dealing with today.
My MPI colleague Charlotta Mellander ran a simple correlation analysis to better understand what’s behind the geography of federal government jobs. As usual, I point out that correlation does not equal causation, but points only to associations between variables. Still, the analysis reveals a number of interesting patterns.
First off, there is only a weak association between the growth in government jobs over the last decade and the baseline levels of government jobs in 2003.
Strikingly, there was no correlation at all between share of federal jobs and a wide range of economic indicators, including economic output per capita, the share of professional, knowledge and creative workers, or the share of college grads. Even more remarkably, we found a negative correlation between federal government job levels and innovation (-.26, as measured by patents per capita).
When all is said and done, a distinctive geographic pattern emerges from our map and analysis. There is a clear “federal employment belt” so to speak, running through the Sunbelt.
Significantly, this map does not align with the high-tech centers that are driving America’s new knowledge economy. Federal funding is an important part of the country’s scientific and technological infrastructure, and federal R&D spending does flow into many of these leading high-tech metros. But America's leading high-tech centers, in Silicon Valley and the San Francisco Bay area, Boston-Cambridge, and the Research Triangle, have relatively low shares of direct federal employment.
At the end of the day, it is America’s red states that appear more heavily tied to the levels of federal employment than their blue state counterparts, setting up a fundamental irony about the locations of the most ardent “starve-the-beast” supporters of smaller government.