The Virginia Beach-Chesapeake-Norfolk metro area has an overall grade of C+ with a composite score ranking it 42.9th percentile out of 50 US metros. This city's economic character is most defined by its low labor demand, with a labor demand composite score of 1.56, and its strong wage growth, with a year-over-year increase of 6.14% in hourly earnings. The combination of a -0.96% employment growth rate and +1.397% weekly hours deviation signals a survivor squeeze, where remaining workers are absorbing the load of eliminated roles.

Labor Demand

The employment growth rate in this metro area is -0.96% year-over-year, while weekly hours are deviating 1.397% above the city's own 12-month baseline. This combination signals a survivor squeeze, where the remaining workforce is taking on more hours to compensate for the loss of jobs. The labor demand composite score of 1.56 ranks in the bottom tier, at the 4th percentile, indicating weak labor demand.

Unemployment

The unemployment rate in this metro area is 3.70%, ranking near the median at the 53rd percentile. This indicates a relatively balanced labor market, neither too tight nor too slack. For a business trying to hire in this area, the moderate unemployment rate means that hiring may not be overly competitive, but it also may not be extremely easy to find qualified candidates.

Wage Growth

The year-over-year wage growth in this metro area is 6.14%, ranking above average at the 78th percentile. This strong wage growth signals rising labor costs for employers, but also increasing purchasing power for workers. As a result, businesses may need to budget for higher labor costs, but they can also expect a more affluent local consumer base.

Cost of Living

The cost of living in this metro area is near the median, with a percentile rank of 50th, and a price-to-salary ratio of 6.35, based on $224/sqft and $35.27/hr. The fact that the PSF is rising 2.3% year-over-year relative to wages means that the city is not becoming more affordable. This neutral cost of living means that businesses may not have a significant talent attraction advantage due to affordability, and may need to offer wage premiums to compete.

Labor Force Growth

The civilian labor force in this metro area is shrinking at a rate of -1.31% year-over-year, ranking below average at the 22nd percentile. This contraction in labor force supply signals a structural headwind for hiring, making it more challenging for businesses to find qualified candidates. As a result, businesses may need to invest in training and development programs to build the skills they need.

Building Permits

The number of residential building permits in this metro area is increasing by 163.12% year-over-year, ranking in the top tier at the 98th percentile. This rapid expansion in housing supply signals improving affordability and a more accommodating environment for the workforce. As a result, businesses can expect a more stable and growing pool of potential employees.

Days on Market

The median days on market for homes in this metro area is 37 days, with a year-over-year decrease of 2.6%. This relatively fast pace of home sales, ranking in the bottom tier at the 18th percentile, means that the market is competitive, and relocating workers may face challenges finding housing. Businesses may need to offer relocation assistance or flexible work arrangements to attract talent.

Office Economy

The share of professional and office workers in this metro area is below average, ranking at the 22nd percentile. This indicates a relatively shallow talent pool for businesses in the tech, finance, or consulting sectors. As a result, this city may be better suited for businesses in industrial or logistics sectors, rather than those requiring a deep knowledge-economy talent pool.

The Virginia Beach-Chesapeake-Norfolk metro area offers businesses a unique combination of strong wage growth and a rapidly expanding housing supply, but it also poses significant challenges due to its low labor demand and shrinking labor force. The single biggest risk or constraint for decision-makers is the survivor squeeze and the resulting competition for a limited pool of qualified candidates, which may drive up labor costs and require significant investment in training and development programs.