When it comes to Virginia’s economy, the glass may be half full, or it may be half empty.
First, some bad news: In the year that ended May 31, Virginia lost 51,400 jobs. That is the most jobs lost by any state. A good share of those jobs, about 40%, were caused by federal government cutbacks. The Department of Government Efficiency has shut down, but it continues to bite in the commonwealth.
However, “even if Virginia didn’t lose any federal jobs, it would still lead the nation in job losses, according to the Bureau of Labor Statistics,” as Dwayne Yancey notes at Cardinal News. “Virginia has actually lost more jobs (22,600 or 43.9% of the total) from professional, scientific and technical service jobs; a lot of federal contractors fit under that category. Virginia has lost jobs in most other categories, too.”
To make matters worse, Virginia is losing manufacturing jobs at a faster rate than any other state. Part of the problem is that several 20th-century-era factories have shuttered in the last year, such as the Goodyear plant in Danville and the Yokohama plant in Salem.
Meanwhile, many of the forward-facing manufacturing projects that have been announced, especially energy plants and pharmaceutical plants, will take years to construct and open. The proposed fusion plant in Chesterfield could be a game changer for energy and employment, but it’s also possible that the fusion technology might never work, which would make the whole proposal a washout.
The commonwealth wants to provide the manufacturing jobs of the future, making rockets and zero-carbon electricity rather than providing coal and lumber to other states. But that future is always uncertain until it arrives, and the transition was always going to be rocky.
There is also good news. In the fiscal year that ended June 30, the commonwealth racked up a budget surplus of $936 million. General fund revenues last year jumped by 6.7%, more than $2 billion. More than $500 million of that surplus will be incorporated into the 2027 budget.
In addition, Virginia jumped a slot and now ranks third in CNBC’s annual listing of “America’s Top States for Business.” Virginia had ranked No. 1 in CNBC’s 2024 report when it notched its third victory in five years. The commonwealth dipped to No. 4 in 2025. For this year, CNBC cited the state’s infrastructure (second in the nation) and education policies (fifth in the nation) as major factors in its move back up the rankings. CNBC changes its methodology every year, which can change its rankings.
Looking ahead, economists at the University of Virginia’s Weldon Cooper Center for Public Service projected that Virginia will lose jobs this year. However, they forecast that the state may turn the corner and start to gain jobs again in 2027. In testimony to the state Senate this spring, Secretary of Finance Mark Sickles warned that “while Fiscal Year 2026 looks good for revenues, macroeconomic trends indicate there may be storm clouds on the horizon.”
So, Virginia’s glass is filling or emptying, depending on how you prefer to look at it.