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Economic Forces That Shape Montgomery County

Phase I - October 1996

This study was commissioned by the Montgomery County Council to better understand critical elements of the County's economy: employment growth and patterns, work force characteristics, vacant and redevelopable comercial sites, commercial space characteristics, business location and space preferences, and federal government impact. The study revealed an economy that in 1995 was recovering from the 1990-91 recession a little more slowly than the nation and some parts of the region in percentage terms, but also an economy with many significant strengths and bright spots. In the context of a widely publicized, highly visible drive to reduce the size of the federal government and its expenditures, Montgomery County's federal agencies faced few additional reductions and were fundamentally strong. The comparatively tight market in most Class A office space, flex space, and industrial space was another welcome sign (compared to the higher vacancy rates in preceding years,) as was the sizable inventory of vacant and redevelopable land for commercial development. The strength of medium and high wage jobs and of many desirable business sectors were also positive indicators.

There were also some areas of concern. Some business sectors were not doing as well as expected, notably information technology firms. Employment space in some areas of the County and in some types of buildings were still suffering high vacancy rates. The County's job growth lagged Northern Virginia's, although by less than it did earlier in the 1990s. Overall, however, the economy appeared to be moving in the right direction.

Detailed summary of the study findings.

NOTE: A copy of the full report is available from the Research & Technology Center.