Wage and salary employment increased 1.6 percent in the region for the 12 months ending November 1998. Delaware and Virginia reported the largest percentage gains, 3.2 and 2.4 percent, respectively. Forty percent of the estimated 200,000 new jobs added during the period were in Virginia, while Maryland accounted for 23 percent of the increase. Pennsylvania and West Virginia recorded modest gains of 1 percent each. Employment in call centers has been rapidly expanding throughout West Virginia. The tele-service/telemarketing industry has quadrupled in the past 5 years and currently employs some 22,000 people at more than 40 call centers across the State.

The unemployment rate in the Mid-Atlantic region dropped to 4 percent as of November 1998, from 4.6 percent 12 months earlier. Virginia reported the lowest rate, 2.8 percent, followed by Delaware at 3.2 percent. The Washington, D.C. metropolitan area has become the growth engine of the region, accounting for 35 percent of the total employment increase. Unemployment in the metropolitan area has fallen to 2.9 percent, one of the lowest for a major metropolitan area. Northern Virginia continued to lead the area in job creation with a 3.8-percent annual rate of growth. The strong gains in the Washington metropolitan area in 1998 are due largely to increases in construction -- both commercial and residential -- and services.

Manufactured housing shipments to the States in the Mid-Atlantic region for 1998 were down 3 percent to 20,013 homes. Manufactured housing remains a significant source of housing production for home-owners in Delaware and West Virginia. In West Virginia shipments totaled 4,344 homes, almost 11/2 times the number of single-family building permits.

The year 1998 was a very good one for residential construction throughout the Mid-Atlantic region. Single-family building permits totaled 105,665 homes for the year, 12 percent over 1997. All States reported increased activity in 1998. Virginia led the region with 39,871 units, a 12- percent gain. Except for the Baltimore metropolitan area, where activity was down 5 percent, the region's major markets recorded significant gains. The Washington metropolitan area had the greatest volume (28,768 homes) and percentage gain (23 percent). Single-family permits were up 8 and 9 percent, respectively, in the Pittsburgh and Philadelphia metropolitan areas. The Richmond-Petersburg and Norfolk-Virginia Beach-Newport News areas recorded increases of 13 and 14 percent, respectively.

New home sales performance in the Mid-Atlantic continued to show increased strength. In the Baltimore area, sales of new homes were up 25 percent in 1998. Sales of new homes in the Anne Arundel County and Howard County suburbs in Maryland were 60 percent greater than those in 1997. The Washington metropolitan area's new home sales were up 10 percent, according to Meyer's Housing Data Reports. In the outlying suburbs of Northern Virginia new sales in Loudoun and Prince William counties were very strong, up 25 percent and 14 percent, respectively.

The market for existing homes in the region was as strong as that for new sales housing in 1998. Resales for the region in 1998, excluding Delaware, reached an annual rate of 519,600 homes, a 14-percent increase over 1997. Resales in Virginia and Maryland were up 30 and 28 percent, respectively. In the Washington metropolitan area, resales for 1998 totaled 72,884 homes, a 26-percent increase over 1997. Sales in the District of Columbia in 1998 were 51 percent greater than sales in 1997. Activity in Virginia was up 27 percent, with sales in rapidly growing Loudoun County up a dramatic 70 percent. On the Maryland side of the metropolitan area, sales climbed 23 percent to 27,013 homes by the year's end.

The healthy rental housing market conditions in the Mid-Atlantic's major markets supported a continuation in 1998 of the recent high volume of multifamily housing construction. During 1996 and 1997, permits averaged almost 22,000 multifamily units annually and rose to 26,200 units in 1998. Activity in Maryland was up 52 percent in response to the much-improved rental market conditions in the Baltimore area. Virginia multifamily permit volume increased 6 percent over 1997 to 10,283 units, making 1998 the best year of the decade. The Washington metropolitan area recorded a 31-percent increase in the number of multifamily units permitted. Of the region's major markets, only Philadelphia experienced a decline in multifamily activity in 1998, dropping 33 percent in response to the large volume of units permitted during the previous 2 years.

Spotlight on Philadelphia, Pennsylvania-New Jersey

In the 12 months ending in November 1998, employment in the Philadelphia metropolitan area increased a modest 1.2 percent to 2.3 million. The unemployment rate declined to 4 percent from 4.4 percent in November 1997. Similarly, the unemployment rates for the area's counties and the city of Philadelphia were below the rates of a year earlier.

The Republican National Convention in 2000 will result in developments in the city of Philadelphia and in Camden, New Jersey, with construction costs totaling more than $2 billion. Development along the Camden waterfront will include a new hotel, museum, children's garden, and expansion of the New Jersey State Aquarium. Camden also anticipates the opening of a ferry terminal, shops, movie theaters, stores, and restaurants to round out the attractions on the New Jersey side of the Delaware River.

Construction and renovation costs of nine hotels in Philadelphia will total $923 million. In addition, there is to be a $200 million expansion of the Convention Center, along with an investment of equal amount in infrastructure. The Avenue of the Arts will also receive a $250 million investment and will be extended north. Tourists will benefit from the construction of the National Constitution Center, the Independence Mall Visitor Center, and a major urban entertainment complex planned for Penn's Landing. Center City neighborhoods will also participate in the renovations, including improvements to Market Street East from Independence Mall to the Delaware River, completion of the Schuylkill River walkway, improvements to the Art Museum, and investments in 20 smaller sites. Funding for a tram connecting Philadelphia with Camden is also anticipated.

The sales housing market in the Philadelphia suburbs in 1998 was strong for both new and existing homes. Single-family building permits, at 14,258 homes, were up 9 percent from 1997.

The number of multifamily units permitted was down nearly 33 percent to 2,155 units in 1998. The decline is partly a response to the high volume of activity over the 2 prior years, when permits were issued for almost 5,500 units. In Philadelphia one of the largest historic redevelopment projects in the past 12 years has been proposed for the Washington Square neighborhood. The 35-story luxury rental building, to be known as St. James Place, is to include 328 luxury units. In addition, a row of historic one- and two-story buildings and portions of the historic PSFS bank building, designed by Frank Furness, are to be converted to apartments and retail space. The total development cost is estimated to be more than $46 million. The city council has approved Tax Incremental Financing assistance of approximately $7 million.