State economy stuck in neutral as election nears

The state's unemployment rate holds steady, but does it provide any traction in the upcoming election?

The state's unemployment rate holds steady, but does it provide any traction in the upcoming election?

The latest state economic report, the last big look before the November election, shows Washington state and the Seattle metropolitan area stuck in neutral, with the unemployment rate for September holding steady at 9 percent. The Seattle area rate was 8.6 percent, the same as in August. 

The impact of revenue shortfalls for state and local government is beginning to show up in the employment figures; 4,200 government jobs were lost in September, far surpassing the 1,000 new jobs created in the private sector.  

The new jobs in the private sector are encouraging, but Dave Wallace, chief economist for the Department of Employment Security, said job losses in government “will continue to be the story” over the next few months. Temporary Census workers accounted for about 1,200 of the lost government jobs, but there are now fewer than 200 census jobs left as the nationwide survey winds down. 

Do statewide economic reports affect how voters feel about local races? That’s hard to determine. Rick Cocker of Cocker Fennessy said “The pundits all seem to say people totally vote their pocketbooks.”  

“Our poll does indicate that jobs and economy are dominating the minds of voters here in Washington state,” said Matt Barreto, associate professor of political science at the University of Washington and director of the Washington Poll. “This is a state issue, so it is harder to connect to Murray or Rossi. It would be a much bigger deal if there was a race for governor.” 

Wallace agreed that the state economy was in “somewhat of a holding pattern.”  He said there is a negative feedback pattern at work where people are laid off from jobs and spend less, which leads to further job losses. There was a decline in the number of jobs in the leisure/hospitality sector, a reflection of that trend.

“We’re gradually seeing private-sector jobs returning, and I find optimism in that,” said Employment Security Commissioner Paul Trause in a statement.   
Industries that added jobs in September included manufacturing, up 900; wholesale trade, up 700; financial activities, up 600; and transportation, warehousing and utilities, up 400. Most of the manufacturing jobs were in aerospace, Wallace said. The increase in wholesale trade jobs could be a positive for the future. 

So far in 2010, Washington has added 8,800 private-sector jobs, the department said. Factoring in a substantial loss of government jobs, there has been an estimated net gain of 1,200 jobs during the past nine months.  
An estimated 303,183 people (not seasonally adjusted) in Washington were unemployed and looking for work in September, and 223,288 people received unemployment benefits from the state that month. 

In the Seattle-Bellevue-Everett area, little changed, with the unemployment rate at 8.6 percent and 128,700 unemployed, the same as in August. Snohomish County was up slightly to 9.6 percent in September from 9.4 percent in August. The Tacoma/Pierce County rate was down to 8.8 percent vs. 9.3 percent in August. 

San Juan County had the lowest rate in the state at 5.5 percent, while Clark County had the highest at 12 percent.   

Often overlooked is the farm economy in the state.  That area is doing well.  Total agricultural employment during September increased 2.3 percent over the previous year. Statewide total agricultural employment increased 13 percent from August to September, primarily due to the ramping up of the apple harvest.


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About the Authors & Contributors

Stephen H. Dunphy

Stephen H. Dunphy

Stephen H. Dunphy writes on business and economic issues for Crosscut. He was a business editor and columnist for a number of years at The Seattle Times.