A recent cost-cutting initiative by Elon Musk's Department of Government Efficiency has led to significant job losses among federal employees in Washington, DC. While the housing market remains stable, experts warn that reductions in the federal workforce could adversely affect local housing demand. Unemployment claims have surged significantly within the area, with thousands of federal workers filing for unemployment benefits. The situation reflects a potential forthcoming shift in the housing market linked to job security and labor market changes in the region.
"The health of a local housing market is often tied to the health of the local labor market," says Realtor.com Chief Economist Danielle Hale. "Federal workforce reductions could have ripple effects on housing markets with a high concentration of government employees."
According to the latest figures from the U.S. Department of Labor released on Thursday, unemployment claims in the capital were up 20% during the week ending on Feb. 22 compared with the previous week.
Since Trump's inauguration, some 8,730 workers from DC have filed for unemployment insurance. It's unknown how many of them are federal workers.
Overall, applications for jobless benefits across all sectors rose by 22,000 to a three-month high of 242,000 last week but remained within the same healthy range of the past three years.
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