President's Column

Friday, April 10

Most of Washington is still dealing with high unemployment

The recession is over, but don’t try telling that to someone who is out of work.

As of February — more than five years after the Great Recession technically ended — 222,300 people in Washington state were unemployed, according to the state Employment Security Department.

That's a troubling number for a variety of reasons. It’s well above the national unemployment rate of 5.5 percent, for starters. Perhaps even more concerning, though, is that February marked the sixth straight month where Washington’s jobless rate either rose or remained even from the previous month.

After several months of declining unemployment numbers, we’re no longer moving in the right direction.
It’s not clear what’s behind the trend, but it should give pause to those who are pushing to raise the statewide minimum wage to $12, $15 or even $16 per hour. If 222,300 people can’t find work now, with Washington’s nation-leading $9.47 minimum wage, how will they find work at $16 per hour?

It should also raise concerns about Gov. Jay Inslee’s proposed cap-and-trade tax. According to the governor’s own analysis, the proposed tax will drive up the cost of gas 12 cents per gallon immediately and 41 cents over time. The price of natural gas will rise by 22 percent over time.

Higher energy costs will slow the growth of the economy. According to an independent analysis, the proposed cap-and-trade tax will result in an average of 56,000 fewer jobs being created annually over the next 20 years, and 6,000 of those would come out of the manufacturing sector which pays an average annual wage of $82,000.

If you live in Seattle, where the tech industry is fueling rapid job growth, neither of these points may be compelling. King County’s February unemployment rate was just 4.8 percent, well below the national average and near a figure that economists consider to be “full employment.”

Its neighbor to the north, Snohomish County, was slightly higher at 5.3 percent but still below the national average.

If you live anywhere else in Washington, though, the potential for a higher minimum wage and higher energy costs certainly matter. In 37 of 39 counties, Washington’s unemployment rate was higher than the national average.

In eight counties, unemployment was between 6-8 percent. In 16 counties, including Douglas and Chelan, the unemployment rate was between 8-10 percent, and in 12 counties, including Grant, it was higher than 10 percent.

Keep in mind that the nationwide unemployment rate never went above 10 percent during the worst part of the recession.

So what does this mean?

It means that Washington’s economy is still fragile, despite the large number of construction cranes dotting the Seattle skyline, and that lawmakers need to be careful about adding costs to families and employers.
It means Washington’s economies are no longer divided by the Cascade Mountains, but rather are split between King and Snohomish counties and the rest of the state.

And it means that, at least until Washington’s unemployment rate is equal to the national average, we need to keep job creation our top priority.

Back To News