Reston Spring

Reston Spring
Reston Spring

Wednesday, November 30, 2011

A Review of the GMU Report on the Region’s Workforce, John Hanley, November 30, 2011

Note:  This review refers to the GMU Center for Regional Analysis (CRA) report, Housing the Region's Workforce:  Policy Challenges for Local Jurisdictions, October 25, 2011.
A Review of the GMU Report on the Region’s Workforce
Published October 2011

The above Report addresses what may occur in the Greater Washington area between 2010 and 2030. This review assumes the reader’s principal interest lies in identifying how the Report’s conclusions are likely to affect Reston and its contiguous neighborhoods. I also tried to access press and other reaction to its conclusions, but so far found little.

I did however find a recent interview in the Washington Post with one of the Report’s authors, Lisa Sturdevant, who mentioned the fact that the basic figures were subject to recent economic factors. Sturdevant also admitted that the Report’s estimate of 730,000 net new jobs was subject to “significant uncertainty”. That was quite an understatement. Pressed, she qualified her remark to admit that “the latest predictions call for 500,000 fewer additional jobs in the region by 2030 than were forecast before the financial crisis.” Knowing that your headline-grabbing figure of 1,050,000 additional new regional jobs over the next twenty years is subject to a 50% error factor is something that should have been included in the executive summary.

Nevertheless, there is a lot of time between now and 2030 and things could well evolve more positively in the interim. In any case, the potential reduction does not take away from the importance of the Report. But it is a something that a reader should bear in mind. 

Assuming that the Report’s workforce growth figure above will come about over the next 20 years and that 731,000 extra housing units will be required in the region by then, even allowing for the error factor, it is clear that the region will have a significant problem in ensuring that all these additional workers can live and  work near their place of employment.

Policy implications high-lighted in the Report are that:
  1. Local jurisdictions are not presently planning for sufficient housing to accommodate a significant increase in future workers.
  2. More housing is needed closer to workers’ jobs.
  3. More multi-family, affordable owner and renter houses are needed.
  4. A lack of such housing (whether close to public transit or not) will mean more out-of-region commuting. This will aggravate the Washington area traffic congestion, already the worst in the country.
  5. It will also mean more income spent and taxes paid outside work jurisdictions, such as Reston.
Accepting the 731,000 unit figure, the fundamental housing problem is that 25% of units will need to be priced at under $200K, 44% between $200K and 399K, 26% between 400K and 599K with only 6% above the last figure. All these suppositions are backed by impressive wage-level, jurisdictional and employment segment estimates, incidentally. Nevertheless, as the Report says blandly, “In some markets, it would be very difficult to build new units at these lower prices, without significant subsidy.”

Other significant findings are:
  1. Today, no jurisdiction in the Washington area has a housing policy designed to respond adequately to its economic growth potential and workforce requirements.
  2. If jurisdictions such as Reston are dependent on non-residential workers, they will have to spend significantly on extra transportation services. On the other hand, if they can accommodate predominantly resident workers, they will incur much lower expenditures.
  3. As noted above, if workers are resident, they will spend money and pay taxes locally.
The Report’s headline apart, its findings do not sound very promising for Reston at this time. All the more so, given that Fairfax County, together with Loudoun and Montgomery Counties and DC, are the jurisdictions where the greatest growth is predicated.

While it is beyond the remit of the Report, it would have been useful had the authors been able to estimate how much new office space may be required, given high present vacancy levels across the region. Also, the Report could have looked at possible effects of telecommuting on their conclusions. In support of their findings, besides Bank of America, the authors listed a number of experts, plus NVR, Kettler, and Gordon, Smith Inc. IHS Global Insights was a prime source of statistics and information. 

All in all, this is a thought-provoking, timely and interesting Report. It will need careful review and questioning, of course, given the big potential for error and the lack of Reston-specific developer, real estate and Fairfax County input.

John Hanley, Co-Chair Reston 2020
Reston Citizens Association Board Member

No comments:

Post a Comment

Your comments are welcome and encouraged as long as they are relevant, constructive, and decent.