AKA The “Hidden Gem” State

Welcome to the commonwealth of Virginia, it’s called a commonwealth instead of a state because Virginians think that makes them special. Don’t be fooled, Virginia is a state.

Virginia benefits from being a diverse state, geographically. You’ve got a coastal area, central piedmont, and mountains. Much like many southern states Virginia got its start in agriculture and this remains an important part of the economy today. I can personally vouch for cows and dairy, as I saw dozens of such farms along the interstate during a recent Thanksgiving jaunt. Though not as popular as California, wineries are starting to pop up all over the state. In addition to the cattle already mentioned, tomatoes, peanuts, and tobacco are the big cash crops.

The capital of Virginia is Richmond, a proud tobacco town that has managed to snag themselves one of the 12 Federal Reserve banks, and a handful of Fortune 500 companies. With the exception of CarMax, you probably haven’t heard of them because they aren’t big consumer brands. Nevertheless, they make good money for the state.

Finding your way to the beaches of Virginia usually means one thing, Virginia Beach. The entire Chesapeake region plays host to tourism, shipping, and farming. Though insignificant on a GDP scale, it should be noted that Virginia Beach is a hotspot for hip-hop music.

As you travel elsewhere around the state, you’ll find more of the same. More Fortune 500 companies, more farms, and many satellite offices of other large corporations. Another big employer around the state is the many fine universities that can be found. Virginia Commonwealth University (not to be confused with Virginia State) is based in Richmond and employs more than 20,000 people. Elsewhere you can find Virginia Tech, well known for football and outstanding academics. In Charlottesville and Williamsburg you’ll find the University of Virginia and the College of William & Mary, respectively. Both of these institutions are among the 8 original “public ivies” and Virginia is the only state with more than one. There is no shortage of smart alumni coming out of Virginia, and amazingly, these are all public schools.

But why are they the “hidden gem” state? What is hidden in Virginia that makes their economy so special? Why is their unemployment rate so low compared to other southern states? Two words: “The District.” We learned in our tour of Maryland that their economy suckles on the power teet of Washington DC. Well DC is bordered by two states, Maryland and Virginia.

It would almost be easier to list the government agencies that aren’t based in Maryland, but I’ll just cherry-pick the one’s you’ve heard of. To start with, the Pentagon is in Virginia. Virginia is on par with California in terms of Department of Defense spending, and no other states are higher ($30 billion way back in 2001).

Aside from the military of the free world being headquartered in the state, Virginia also calls home to the US Marshals Service, US Fish & Wildlife Service, TSA, FDIC, CIA, US Geological Survey, Patent Office, the Immigration & Naturalization Service, to name a few. In addition to government jobs, government contractors also little the DC metropolitan area, eager to get stimulus money and any other government funds they can,.

All told Virginia has a powerful and diverse economy that most of us would be surprised to learn about. The proximity to the nation’s capital is obviously a big helped there. But they are also friendly to business, and in 2007 Forbes and CNBC pointed out how business friendly they were. Hidden gems and all, the commonwealth has one of the strongest economies in the country.

By The Weakonomist

The Weakonomist is the founder of Weakonomics. Clicking the picture of the puppy will tell you more about him. If you like what you're reading consider subscribing to the blog, following him on Twitter, and checking out the related posts below. Please consider a donation if you really enjoy Weakonomics.

categories: economics, tour of the country