The Seattle region’s economic engine continues to churn, producing the most diversified employment base ever for the region. Since 2012, the Puget Sound has consistently created between 40,000 and 70,000 new jobs year over year. Impressively, the diversity of employment, as well as the concentration of high-wage-earning jobs, consistently topped the rest of the nation. But what is to come?
With permission from the economic and analytic powerhouse that is local research firm Community Attributes, we delved into their excellent forecast of our region to answer that question.
In this post, we cover:
- Major Industries in Washington
- Projected Job Growth
- In-Migration of New Residents
Major Industries in Washington
If there was ever a time the Puget Sound region could boast a diversified base of industries, it’s here and now! From the early days in the 1800s as a “Timber Town” to the aerospace and Microsoft heyday, Washington State’s emergence as a multi-dimensional region is undeniable.
The diversity of industries is punctuated by the strength of companies in each sector. From Amazon’s dominance in retail to Google and Microsoft’s strength in tech, Seattle and the Puget sound are on firm footings.
Of all employment sectors with a bright future, “creative” industries are the strongest and most closely tied to the rise of high-wage-growth STEM industries. King County boasts a panoply of employers in the creative space – with a literal “who’s who” of big-name information technology and creative firms.
Creative jobs in King County continue to grow as the region experiences the “flywheel” effect of creative companies wanting to be located near other creative companies. It’s proven in fast-growth economies from the San Francisco/Bay Area to Boston: creative talent begets more creative companies, which in itself draws more creative talent.
Projected Job Growth
Our so-called flywheel effect of job growth proves itself year over year. The region continues to experience a steady and, at times, exponential upward trend of job growth, with all signs pointing to no abatement of such growth.
Not all regions in the nation (much less the world) demonstrate validated fundamentals for continual growth for the next +20 years. Although the Puget Sound region benefits from such growth, the focal point remains the core MSA of Seattle-Bellevue-Everett.
Forecasts from both the Employment Security Department and Community Attributes predict healthy job growth for the next six years. Economists are loath to overstate the future (in real estate, optimists are called “developers”); however, despite predictions that job growth will taper, healthy growth of nearly 30,000 new jobs year over year is still predicted.
Turning towards sectoral growth, what I argue is the most important category of employment that reigns supreme: Computer and Mathematical jobs.
Why is this category so important?
Primarily, it generates the highest wages (and, historically, the highest year-over-year wage growth). Additionally, this category creates the greatest demand for secondary jobs – the “multiplier effect” of requiring more service work, often predicted as high as four or five jobs created for every single high-tech job.
In-Migration of New Residents
How are we filling all of these jobs? Although Seattle often ranks as one of the most educated cities in the nation, in-migration directly correlates to growth in the region’s employment base. As demand for smart workers increases, so does in-migration.
Interestingly, King County tends to draw workers from similar geographies over the years. A great tool is measuring newly issued driver’s licenses, as surrendered licenses provide empirical data for the source of migration into the region.
California is clearly the origin of choice, which is no surprise considering California’s proximity, collection of talent and high cost of living. However, the data also provides some unexpected insights. For example, growing in-migration from the East Coast is a new phenomenon. Such an insight is helpful to understand the types of new residents and forecast their needs and desires.
The Region’s Future is Bright
Overall, the Puget Sound region – and specifically King County – has a very bright future for a prolonged period of time. The fundamental underpinnings of new jobs, and the wages those jobs will generate, top the nation.
Please give us a call to discuss your plans and goals in 2018. Whether you are considering selling your apartment building, buying more apartment buildings, or simply trying to optimize the portfolio of apartments you currently own, we can help.
Call us for a valuation and to discuss how we can work together. Allow us to Turn Our Expertise into Your Profit!