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Chamber Executives See Up-Tick in State's Economy |
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Written On: May/June 2004 |
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Written By: by Paul Schlienz |
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After suffering through the dot-com bust and the 9-11 recession, Washington may be on the precipice of an economic recovery.
Despite a high 7.4 percent unemployment rate, economic prospects are already looking up in parts of the state. Kitsap County, for example, is experiencing stability in its large military sector while attracting new businesses.
“It’s looking pretty good,” said Silvia Klatman, president of the Bremerton Area Chamber of Commerce. “We weathered the recession well. While the rest of the Puget Sound area was enjoying the dot-com boom, we didn’t. Then when the dot-com bust happened, we didn’t experience it.
“Since 9-11, with the military gearing up, we’ve benefited. In the next 12 months or so, we do have a couple of smaller ships that are being decommissioned. However, we have another aircraft carrier coming into the area at the same time. On top of that, we’ve had a number of smaller companies that have relocated to Kitsap County in the past few years. Those companies are seeing a big uptick in employment numbers.”
Just south of Kitsap, Pierce County is also beginning to rebound.
“Our main industries are trade and transportation, business services and national defense,” stated Gary Bracket, president of the Tacoma-Pierce County Chamber of Commerce. “We’ll see a continuing improvement in our economy, slower than we’d like, lower than the national growth rate, although we may begin to experience growth similar to the national rate in the second half of the year.”
Clark County, in southwestern Washington, boomed in the 1990s, as its semiconductor industry expanded. The county was hit hard by the recession, but appears to be positioned for a comeback.
“We had such a rip roarin’ run that when the economy did slow down we felt it quite a bit,” recalled Addison Jacobs, vice president of the Greater Vancouver Chamber of Commerce. “However, in the last six to eight months, I’ve noticed things have picked up again. People are now saying ‘We can move forward.’”
“Our unemployment figures are still high, and that probably means that we’ll probably lag for a bit longer, but things are starting to feel very positive.”
East of the Cascades, Yakima’s agricultural economy is also showing signs of new vitality.
“Our economy looks improved, but it’s a slow return back to prosperity for our area,” said Gary Webster, president of the Greater Yakima Chamber of Commerce. “We’re heavily dependent on the weather cooperating from the agricultural standpoint, but it appears like it’s going to be much better for our commodity producers.”
In order to encourage the state’s nascent signs of economic recovery, Washington’s business community is insisting on big changes in the way the state treats business.
“Washington definitely has a reputation of not being business friendly,” Klatman said. It’s real disheartening to open national trade journals and constantly see that Washington got named again as having the highest minimum wage and highest unemployment in the nation. What a coincidence!”
“I just moved here from California,” said Ken Opplinger, president and CEO of the Bellingham Chamber of Commerce. “With many of the big problems California faces, Washington is about three to four years behind, but following a similar path. One example is workers’ compensation. California has had 300 percent increases over the last four years. They didn’t address the issue. If we can use California as a guide of what not to do, we’ll all be better off.”
At AWB’s 2004 Legislative Briefing, House Minority Leader Richard DeBolt (R-Chehalis) recalled how Washington’s permitting process sabotaged Boeing’s plans to build its world headquarters at the former Longacres race track in Renton.
“About five years ago, Boeing bought Longacres,” DeBolt said. “It was going to build its world headquarters there. Boeing spent almost three and a half years and quite a bit of money on the process, but it couldn’t get a building permit. So, it started looking elsewhere. If we had given Boeing a 90 day permit for an office building, which doesn’t seem unreasonable, then we, not Chicago, would have Boeing’s world headquarters. Once Boeing puts brick and mortar into the ground, it’s not going to pick up and move some place else.”
While Washington’s loss of Boeing’s headquarters is lamented, Washington’s success in encouraging Boeing to manufacture the 7E7 in Everett is seen as a major victory by the state’s business community.
“It was important statewide for Washington to get the 7E7,” said Rich Hadley, president of the Spokane Regional Chamber of Commerce. “The entire state is heavily impacted by how King and Snohomish counties do economically.”
“We have a tremendous number of subcontractors over here in the Yakima area that supply to Boeing,” Webster remarked. “If Boeing had not been retained, it would have put in jeopardy the accounts of those employers in the Yakima Valley.”
The state is also receiving kudos for extending high-tech tax credits.
“R&D tax credits were situation critical for us in Clark County,” Jacobs said. “We had to have those tax credits for the existing semiconductor industry and to attract new businesses. It was really baseline in terms of being able to have continued growth in that manufacturing and high-tech sector.”
While Washington no longer offers the lowest electrical rates in the nation, its natural beauty, quality of life, strong university research base, proximity to Asia and location on the main highway between Canada and Mexico hold great appeal for prospective employers. Nevertheless, the business community insists that Washington cannot rest on its laurels and expect new businesses to set up shop while other states are offering more incentives and friendlier business climates.
“I think we as a state have a lot more work to do on creating an environment that’s welcoming to business and gives business the tools it needs,” Jacobs concluded. “I’m hopeful that our state is beginning to show an understanding that that’s the way we need to move. I congratulate AWB for taking a good leadership position on this issue.”
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