Joblessness in Arlington County is up 38% year-over-year in new state data, and local officials are warning that federal layoffs will likely bring further increases.
A total of 5,413 Arlington residents were recorded as seeking jobs in August, according to data released yesterday (Wednesday) by the Virginia Department of Workforce Development and Advancement. That’s compared to 3,932 unemployed residents in August 2024.
As a result, the jobless rate rose from 2.5% to 3.5% during that span.
The August 2025 jobless rate was unchanged from a month before, and the number of unemployed declined slightly from 5,500 in July. But it was still the second-highest total since the depths of the pandemic.
The year-over-year increase in unemployed Arlingtonians is significantly higher than Northern Virginia’s unemployment increase of 23.8% and the 23.1% increase in the D.C. region as a whole, according to figures reported yesterday by the federal Bureau of Labor Statistics.
August 2025 unemployment rates were 3.6% across Northern Virginia, up from 3% a year before, and 4.3% metro-wide, up from 3.4%.
Statewide, the number of unemployed rose 16.5% year-over-year to 175,560 in August. The state’s unemployment rate stood at 3.9%, up from 3.3% a year before.
All figures represent non-seasonally-adjusted data.
Unemployment figures for Virginia metro areas are reported a month after being compiled. The August figures came out the same day the federal government entered a shutdown as Congress failed to agree on a spending plan at the start of the fiscal year.
It is the fourth government shutdown over the past decade, with the longest lasting 35 days in 2018-19.
Leaders across Northern Virginia are watching the situation in an effort to gauge its impact on an already rattled local economy.
“We’re entering some challenging times,” Fairfax County Board of Supervisors Chair Jeff McKay said at a Sept. 30 meeting when that county’s leadership voted to put additional fiscal 2025 carryover funding into reserves in an effort to cushion the economic blow.
About 14% of the region’s workforce is employed by the federal government. But in areas like Arlington, Alexandria and D.C., the rate is more than 20%.
Among those watching the shutdown situation closely is Lisa Sturtevant, chief economist for the Bright MLS multiple-listing system.
“In general, previous impacts of a federal government shutdown on the local economy and housing market have been modest and temporary,” Sturtevant said. “However, this shutdown is different for a few reasons, and the potential for negative impacts on the economy and housing market are more significant.”
Those negative impacts could chill an already cool local housing market, Sturtevant said.
“Even before the shutdown, the Washington D.C. area housing market was weaker than other Mid-Atlantic markets, with more listings, slower home-price appreciation and longer time on market,” she said. “This shutdown could significantly impact housing demand — in the D.C. area, there will be a more direct impact on housing demand and supply.”
The Youngkin administration attempted to find the positive in August’s jobs numbers, and pointed to a year-over-year increase in nonfarm employment across the commonwealth.
“Virginia businesses are growing, and our economy is strong. The gains we’re seeing in payroll jobs reflect confidence from employers, and we’ll keep building on this momentum,” said Secretary of Commerce and Trade Juan Pablo Segura.
Unemployment rates were higher in August than a year earlier in 243 of the nation’s 387 metropolitan areas, lower in 115, and unchanged in 29, the U.S. Bureau of Labor Statistics reported.
The national jobless rate of 4.5% was statistically unchanged from a year before, according to federal officials.
Thirty metro areas had jobless rates of less than 3%, with eight areas recording rates of at least 8%.
Of the 56 metropolitan areas with a 2020 Census population of a million or more residents, the lowest August rates were reported in Birmingham and Honolulu at 2.5% each. The highest rate was found in Fresno, Calif., at 7.9%.
Falls Church sees 60% jobless increase: The city of Falls Church saw a major year-over-year bump up in August joblessness, according to state data.
The number of city residents recorded as unemployed totaled 382, unchanged from a month before but up 60% from the 239 recorded in the August 2024 report.
During the period, the city’s jobless rate rose from 2.8% to 4.6%, according to Virginia Department of Workforce Development and Advancement figures. That is the city’s highest rate in the post-pandemic era.
