Study: Virginia’s economy turns corner but storm clouds loom
NORFOLK, Va. (AP) — A new economic report says Virginia has finally pulled out of the doldrums caused by the Great Recession and past restrictions on federal spending.
Old Dominion University’s 2018 State of the Commonwealth Report was released Saturday. It says Virginia’s economy picked up pace and is likely to improve more rapidly next year.
A big reason is the increase in federal government spending, which makes up about a third of Virginia’s economy. Military funding in particular will help sustain growth in 2019.
Amazon’s plan to build a headquarters in northern Virginia also factors into the higher expectations.
But the university in Norfolk also warned of “storm clouds on the horizon.” The rapidly increasing federal deficit could ultimately lead to spending cuts and federal tax increases. Neither would bode well for Virginia.