inRoads Research: Economic Snapshot
Economic Snapshot: A Summary of the 2015 Hampton Roads Regional Economy
A Growing Hampton Roads
To enhance Hampton Roads’ position within a global economy, it is important to identify trends occurring within our regional community. Other than our strategic location, a strong asset to our region is the diverse resident population of Hampton Roads. This group serves as one of our regions strongest renewable resources.
A growing population can fuel many outcomes within a regional economy. Some variables that can be influenced by a growing population include: an increased market size to bolster economic activity, increased investment from foreign and domestic markets, stimulation and innovation among industry clusters, and accelerated educational programs.
As we can see in graph 1 titled ‘Population Growth’, from years 2005 to 2015 the Hampton Roads population has increased by nearly 77 thousand residents. This increase represents a 10-year 5% regional population growth.
Employment trends through 2015 displayed the annual seasonal increase in employment within Hampton Roads. As we can see in graph 2 titled ‘Employment Trends’, employment from March 2015 to July 2015 started lower, ended higher, and lasted deeper into the summer of 2015 compared to 2014.
In the described months, employment rose approximately 2.7% (21,000). This represents an increase from 2014 where March to July employment rose by only 1.5% (12,000).
2015 Aggregate Percent Changes in Employment by Industry
Analyzing aggregate changes in quarterly averages gives us an understanding of how a particular industry sector performed over the course of the year.
The top performing industry sector in 2015, as it relates to the aggregate percent change in employment, was the Leisure and Hospitality sector. This industry sector witnessed the largest increase in year-end employment at 9% adding approximately 7,000 jobs. Financial Activities grew by nearly 5% adding 1,800 jobs, and Professional and Business Services ended the year at 3.5% adding 3,700 jobs.
Other industry sectors that saw growth over 2015 include Education and Health ending the year at 2.26% adding 2,200 jobs, and Trade, Transportation, and Utilities at 2.14% adding 2,900 jobs.
The graph above shows the 2015 aggregate percent change in employment by regional industry super sector.
The following section highlights the Financial Activities sector of the Hampton Roads Regional Economy.
Industry Spotlight: Financial Activities
Financial Activities 12-month percent change in employment, 2014 - 2015
Throughout 2015, Financial Activities in Hampton Roads hosted increases in 12-month employment compared to 2014. The largest 12-month percent increase (7.5%) occurred in the month of July.
As of October 2015, there is an estimated 40,000 residents working within the Financial Activities industry sector. This represents approximately 5% of total employment within the region.
Hampton Roads Compared
It is important to consider how changes in Hampton Roads compare to other metro areas within the United States. For the purposes of this report, metro areas with populations from 1 to 3 million can be seen as qualified candidates. When comparing October 2015 12-month percent changes in employment within the Financial Activities sector, Hampton Roads boasts favorable employment growth.
This growth is encouraging to our region. Currently, Hampton Roads is 2.5% or approximately 2,000 workers shy of its pre-recession levels of employment within the Financial Activities sector.
The map below displays a variety of metro areas October 2014 to October 2015 12-month percent change in employment within the Financial Activities sector.
From the timeline described, Hampton Roads has witnessed the largest 12-month percent change (5.6%) in employment among selected MSAs.
Finance and Insurance
The Financial Activities super sector consists of two subsectors: Finance and Insurance: NAICS 52 and Real Estate & Rental & Leasing: NAICS 53; both of which have witnessed positive growth over the past five years. Of the two, Finance and Insurance has exhibited the strongest growth – harnessing a 6.4% increase in employment since 2014.
The United States Bureau of Labor Statistics describes the Finance and Insurance industry as being comprised of establishments primarily engaged in financial transactions. A business may be classified within the Finance and Insurance industry if it engages in one or more of three principal types of activities.
These activities include: raising funds by taking deposits or issuing securities which, in the process, incurs liabilities; pooling risk by underwriting insurance and annuities; or providing specialized services which facilitates or supports financial intermediation, insurance, and employee benefit programs.
Internally, the Finance and Insurance sector consists of five subsectors. These subsectors include: Monetary Authorities - Central Bank: NAICS 521; Credit Intermediation: NAICS 522; Securities, Commodity Contracts, and Other Financial Investments: NAICS 523; Insurance Carriers: NAICS 524; and Funds, Trusts, and Other Financial Vehicles: NAICS 525
In Hampton Roads, nearly 100 percent of all employees in the Finance and Insurance industry are employed in four of the five subsectors. They include Credit Intermediation, Insurance Carriers, Securities, Commodity Contracts, and other Financial Investments, and Funds, Trusts, and other Financial Vehicles. The pie chart below displays each subsectors share of total employment within the Finance and Insurance Industry.
There are a variety of occupations involved with the Finance and Insurance industry. In the Hampton Roads region, Insurance Sales Agents comprise the largest percentage of Finance and Insurance workers, employing over 3,200 or 14 percent of total employment within the industry. Customer Service Representatives and Tellers combined represent over 4,500 workers or 19 percent of total employment within the industry. In the chart below, we highlight the top ten most common Finance and Insurance occupations in Hampton Roads with their respective percent of total employment within the industry.
The annual mean wage for all occupations in Hampton Roads for year 2014, as reported by the U.S. Bureau of Labor Statistics, equaled $44,510. In the highlighted occupations above, five of the most commonly held Finance and Insurance occupations are paid a higher wage than the regional mean. Securities, Commodities, and Financial Services Sales Agents earn the most with an annual mean wage of $94,590, closely followed by Personal Financial Advisors earning a mean wage of $94,220 in 2014.