NORFOLK, Va. — The Hampton Roads economy continued to expand for a sixth consecutive year, according to economists at Old Dominion University, but rising prices and a shortage of housing are still creating financial pressure for many residents.
The findings were presented Tuesday during ODU's annual State of the Region report at The Main in downtown Norfolk, where roughly 700 business leaders gathered to hear the latest economic outlook.
Economist Dr. Bob McNab said the region's economy is growing, but inflation continues to affect consumers across Hampton Roads and the nation.
"What we're seeing is an economy that is growing, but many consumers are feeling like they're standing still because prices are increasing," McNab said.
Several key sectors of the Hampton Roads economy showed mixed results.
Defense spending, a major economic driver for the region, continues to increase despite federal job cuts. The Port of Virginia has improved compared to last year, though tariffs remain a concern. Tourism spending also rose, but economists said inflation has limited the impact of those gains.
Economists said higher gas prices may have encouraged more travelers from closer markets, including Richmond and Washington, D.C., rather than longer-distance destinations.
"People don't like to drive long distances [when prices are high]," said Dr. Vinod Argarwal.
Housing remains one of the region's biggest challenges. Economists warned that demand continues to outpace supply, pushing home prices higher.
"If you're not building sufficient housing and demand continues to increase, prices will go up," McNab said.
Looking ahead, economists were also asked about the impact artificial intelligence could have on the Hampton Roads workforce.
McNab said many of the region's core industries, including manufacturing and shipbuilding, are less vulnerable to widespread job replacement by AI than sectors in other parts of the country.
"The good news for Hampton Roads is a lot of the things we do, what we build, AI can assist, but AI can't replace," McNab said. "That's a lot different than a lot of other industries and a lot of other regions."
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