NORFOLK, Va. — Old Dominion University's Dragas Center for Economic Analysis and Policy annual economic forecast is generally upbeat, with much good news.
However, the report finds that inconsistent funding from Congress presents "a major downside risk for Virginia's economy."
That's because the nation finds itself operating under a third consecutive Continuing Resolution (CR) since October 1, meaning, all federal spending is frozen at the prior year's appropriations levels.
"For Hampton Roads, it definitely would slow our potential economic growth," said ODU Economics Department Chair and Professor Bob McNab. "My fear is not only are we going to have more continuing resolutions, but we'll also start next year with a continuing resolution. And we'll just keep rolling along until there's some change in leadership in Congress."
It's a down note in an otherwise upbeat forecast.
The ODU team noted job growth, resilient consumer spending, and lower interest rates and predicts an overall Gross Domestic Product increase for Virginia of 2.1%. It's the third consecutive year of economic expansion since the start of the COVID-19 pandemic.
Even though the report says, "defense spending will continue to provide a boost to the Hampton Roads economy," direct Department of Defense spending in Hampton Roads appears to be stuck in 2024 at 2023's $28.5 billion level.
"Defense spending... we do not know what is going to happen in '24 because Congress has failed to pass an appropriations bill. So, we have to assume defense spending will stay the same in '24 as it is in '23, because that's what continuing resolutions do," said ODU Economics Professor Vinod Agarwal.
