Change is the only constant when it comes to the economy of Hampton Roads, according to Old Dominion University economists.
And with the government shutdown on its seventh day Tuesday, impacts to Hampton Roads will depend on how long it continues, Vinod Agarwal, director of ODU's economic forecasting project, said after the annual State of the Region address in Norfolk.
"If it's a couple of weeks, it's not a big deal. It's an inconvenience and sad," Agarwal said. "The problem becomes if it gets extended. Who's going to get paid and who's not going to get paid?"
Data won't be available until after the shutdown ends, but lost wages and the possible termination of employees would increase the impact of the furlough, Robert McNab, director of ODU's Dragas Center for Economic Analysis and Policy, said during the presentation.
In 2024, the region was home to more than 80,000 active-duty service members and roughly 60,000 federal civilian jobs, according to the State of the Region report.
The region's reliance on federal defense dollars can be a strength, but also a vulnerability, McNab said. The economists have for years advocated for diversifying the region's economy.
"This is really the underlying current of the theme of the report: We either swim together, we succeed together or we ultimately fail separately," McNab said.
More than 800 attendees at the Norfolk Waterside Marriott listened as the economists delved into the region's strengths, opportunities and challenges.
"Here we stand in 2025, and the question is: 'How have things changed compared to 2021?'" McNab said.
To understand that, it's imperative to see how Americans -- and specifically residents of Hampton Roads -- perceive the state of the economy, he said.
While overall consumer sentiment has soured, part of a downward trend since the start of the pandemic, there is a more positive outlook in Hampton Roads, according to data from ODU's Social Science Research Center, McNab said.
"People in Hampton Roads were actually happier in 2025 responding to the survey than they were in 2019, and Americans were quite the reverse," he said.
Projecting how the regional economy will perform in 2025 and beyond is an exercise fraught with uncertainty, according to the report. Before the shutdown, the economists forecasted this year would be the region's fifth consecutive year of real growth, although at a slower pace than in recent years.
"We are growing, but not growing as fast as other regions," McNab said. "Part of this is due to our interdependence with the federal government ... that serves as a strength, but also a weakness."
The Port of Virginia continued to perform well in 2024, though it faced headwinds this year due to ongoing changes to tariffs.
"There's just less dollars flowing to the ports in terms of goods," McNab said.
The greatest declines in exports through the Port of Virginia, he said, based on the dollar volume of goods, includes almost 40% to France, nearly 39% to China and 32% to Brazil. Imported goods are down 32% from Japan, down 32% from Malaysia, down 17% from France and down 16% from China.
Other challenges include a lack of new home construction for the region's housing market, Agarwal said. He stressed the need for officials in the room to think about changing zoning regulations so the supply of homes could increase and the region could continue to attract more workers.
Despite a great deal of polarization in the political landscape today, the Hampton Roads region seems to maintain a sense of cohesiveness that McNab said can serve as a way to cross partisan boundaries and work collaboratively.
"That is how we move forward as a region because we have much more in common than we have differences," he said.