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DC Saw New Businesses Open, While Others Closed Up Shop During Pandemic

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Hundreds of businesses in the District closed their doors permanently as a result of the economic fallout from the coronavirus pandemic, but many others are opening, according to a newly released report.

The DC Policy Center’s report published on March 23 indicated that the city lost 12.6 percent of its private sector employment by 12.6 percent between September 2019 and September 2020, which means a loss of 68,000 jobs.

DC’s losses exceeded the US average, the states of Maryland and Virginia, and the greater Washington metropolitan area. Wages earned by DC employees in the third quarter of 2020 also dropped by 2.7 percent compared to the same period of the previous year.

However, the number of wage-paying establishments in the District increased by 4.8 percent during the same period, “at a rate much faster than many other places in the country,” including Maryland, Virginia, and the US average of 2.9 percent.

DC added a total of 1,951 net new establishments between September 2019 and September 2020, while the overall figure in the region is recorded as 2,396.

The entire metropolitan area lost 217,519 jobs over the same period, and DC constituted 31 percent of this loss. But the city also accounted for 81 percent of the region’s 2,396 net new establishments, the report emphasized.

“This divergence is even more stark for the city’s key industries,” the report says. “In professional and business services, the District lost 7,500 jobs according to unemployment records (38 percent of the loss in employment in this sector in the metro area) but added 537 net new establishments (83 percent of net new establishments in the metro region).”

As for education and health, the District and Fairfax County, including Fairfax City and the City of Falls Church, lost 5,600 jobs and 5,900 jobs respectively, but DC saw the opening of 498 net new establishments, while the figure was 70 in Fairfax.

“Even in leisure and hospitality sectors, where the District accounted for nearly 40 percent of total job losses in the entire metro area, the city reported 40 net new establishments,” according to the report.

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