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Economic uncertainty is prompting consumers, businesses and Fairfax County officials to reconsider their spending as federal cuts and potential tariffs cloud the region’s outlook.

Retail sales increased just 0.2% in February after falling 1.2% in January. Grocery, home and garden, and online retailers recorded gains, while auto dealers, restaurants and electronics stores saw declines.

The modest rebound contrasts sharply with the 4.2% rise in consumer spending during the final quarter of 2024.

The pullback could be especially pronounced around Washington, where federal firings—and possible court-ordered reinstatements—have disrupted government agencies and organizations that work with them.

The Department of Government Efficiency, led by tech billionaire Elon Musk, took control of the nonprofit U.S. Institute of Peace this week. President Donald Trump also called for dismantling the Department of Education, though eliminating a Cabinet department would require congressional action.

Fairfax County has about 79,000 federal employees and another 3,800 federal contractors, according to data recently presented to the Board of Supervisors.

The uncertainty extends beyond household budgets. Fairfax County is considering cuts to some programs, while higher material costs are causing local developers to reconsider large multifamily housing projects.

Tariffs on imported goods could add further pressure by raising prices, giving residents another reason to rethink where and how they spend their money.