The Lynchburg Regional Business Alliance’s Annual Economic Outlook Breakfast, presented by BWXT, offered members a clear and data-driven look at the year ahead. Keynote speaker Eric Scorsone, Executive Director of the Weldon Cooper Center for Public Service and Associate Professor of Public Policy at the University of Virginia, outlined the forces shaping Virginia’s economy and what they mean for our region.

Virginia’s Shifting Economic Landscape
Scorsone emphasized Virginia’s continued dependence on federal activity. With more than 320,000 federal employees and over $100 billion in annual federal contracting, federal spending supports roughly 16% of all jobs statewide. As federal downsizing continues, this dependency is contributing to slower statewide growth. Early projections suggest that 2026 could bring unusually slow or even negative economic expansion.

At the same time, pandemic-era disruptions continue to reshape behavior. Changes in labor force participation, persistent inflation, and evolving consumer patterns have made forecasting more challenging, leaving both policymakers and businesses navigating an economy defined by uncertainty.

Strength and Stability in the Lynchburg Region
Despite statewide headwinds, Scorsone noted several encouraging trends for the Lynchburg region. The area has “closed the economic gap,” performing in line with the Commonwealth and maintaining steady, long-term growth. Lynchburg’s low cost of living remains a major asset, helping the region attract and retain talent.

Manufacturing and education continue to anchor the regional economy, offering stability even as technology and productivity reshape traditional employment. Over the past 30 years, the labor force has grown from about 100,000 workers to nearly 130,000, excluding Liberty University, with unemployment consistently hovering near the state average.

What Businesses Are Watching
During a live poll at the event, attendees identified their biggest concerns. For the broader economy, uncertainty was the top issue. Within their own organizations, leaders highlighted challenges related to productivity, margins, and the ongoing tight labor market. These concerns echo Scorsone’s broader message: while the region is resilient, navigating the next few years will require adaptability.

Looking Ahead
As 2026 approaches, the Alliance remains committed to monitoring economic conditions and advocating for policies that keep the Lynchburg region pro-business, competitive, and strong. With thoughtful planning and ongoing regional collaboration, Lynchburg is well positioned not only to weather economic uncertainty but to capitalize on opportunities as they emerge.