Redefining Economic Success in Washington State: 3 Keys to Quality Growth
Summary
A February 2022 report, "Redefining Economic Success in Washington State: 3 Keys to Quality Growth", a business competitiveness analysis of the state economy commissioned by the Washington State Legislature in 2021 through the Legislative Committee on Economic Development and International Relations (LCEDIR) and administered by the Office of the Lieutenant Governor. It was produced with the consulting firm ECONorthwest and RM Donahue Consulting. The report states that Washington had not completed a comprehensive competitiveness study in nearly a decade, and draws on data analysis, an industry review and outreach to business owners, economists and labor representatives. Its highlights include a transition to a knowledge and tech economy and growth limited by an aging workforce and a skills gap.
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Redefining Economic Success
in Washington State:
February 2022 3 KEYS TO QUALITY GROWTH
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
Acknowledgement
In 2021, the Washington State Legislature commissioned a
comprehensive business competitiveness analysis of the state’s economy
by the Legislative Committee on Economic Development and International ECONorthwest is a consulting firm based Ryan Donahue, principal of RM Donahue
Relations (LCEDIR), to be administered by the Office of the Lieutenant in the Pacific Northwest that specializes Consulting, is a researcher and strategist
Governor. This report is the result of that effort produced through a in economics, finance, and planning. We focused on inclusive economic development
collaborative process involving numerous contributors. understand that businesses and governments in cities, regions, and states. RM Donahue
face difficult decisions about how to make Consulting has worked with state and regional
the best use of limited resources. We help organizations across the country. Ryan
We would like to acknowledge the substantial contributions and guidance that the our clients make thoughtful, data-driven Donahue has partnered with the Brookings
Lieutenant Governor’s office provided throughout this process. decisions using tools and methods that meet Institution, where he is a Nonresident Fellow,
the highest standards of best practice. Our on strategy projects in a variety of regions,
focus is to bring a diverse set of perspectives from high-growth markets (San Diego,
that allow us to fully understand — and Denver, Nashville) to older industrial cities
Lieutenant Governor Denny Heck
effectively communicate — the benefits, (Birmingham, Syracuse, Grand Rapids).
David Bremer, Director of Policy and International Relations costs, and tradeoffs associated with any
Phil Gardner, Chief of Staff decision. Our consultants have advanced
degrees in a variety of fields, including
economics, planning, and public policy;
and work on projects ranging from strategy
We would also like to thank the LCEDIR committee to implementation.
members for their insights and contributions:
■ Representative Liz Berry
■ Senator Sharon Brown
■ Representative Keith Goehner
■ Senator Bob Hasegawa
Triangle Associates has been a trusted Community Attributes, Inc. supports
■ Senator Curtis King
third-party in public and community all phases of economic and community
■ Representative Debra Lekanoff facilitation and input work for over 40 years, development — from visioning to
■ Senator Ann Rivers and our methods of helping groups develop implementation. We aim to support decision-
equitable processes to make good decisions making by linking community development
■ Senator Christine Rolfes
have withstood the test of time. Triangle’s objectives with economic opportunities in
■ Representative Amy Walen facilitation practice is grounded in helping the context of regional economic trends.
■ Senator Lisa Wellman diverse, multi-party advisory and input The hallmarks of our practice are flexibility,
■ Representative J.T. Wilcox groups work together to co-develop lasting responsiveness, and innovation, all of which
input processes, recommendations, policies, we wholeheartedly employ to meet our
■ Representative Alex Ybarra
and decisions. clients’ needs.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth ACKNOWLEDGEMENT
TABLE OF CONTENTS
Executive Summary. ................................................................. 1
1 Introduction, Framework, & Equity Lens........................... 7
2 State of the State......................................................................10
3 Outreach & Engagement. .....................................................17
4 SWOT Summary........................................................................20
5 Redefining Business Competitiveness. ............................25
6 Survey & Themes......................................................................31
7 Three Big Ideas..........................................................................35
Appendix. ...................................................................................39
A. SWOT Industry Cut Sheets. .................................................. 39
B. Engagement – Detailed Notes. .......................................... 67
C. Foundational Items and Themes. ...................................... 81
D. Business Competitiveness Metrics.................................... 96
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
Redefining Economic Success
in Washington State:
3 KEYS TO QUALITY GROWTH
EXECUTIVE SUMMARY
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
Executive Summary | Project Overview
Prior to this report, Washington had not completed a comprehensive study measuring the competitiveness of the state economy in nearly a decade. This study takes a hard
look at the Washington economy, scrutinizes traditional indicators of success, and evaluates some common barriers to growth. The process was iterative, gathering insight
from diverse groups including small and minority business owners, industry economists, and Labor representatives, among others. Using data analysis, an in-depth industry
review, and application of an equity lens, this outreach shed light on the key barriers the state faces to enhancing business competitiveness today. This report moves the
conversation forward towards solutions.
Washington Long-term Economic Trends: Highlights
■ Successfully transitioned the economy into a knowledge and tech leader.
■ Strong growth in the economy is limited by an aging workforce and a skills
gap, decades in the making.
■ Household incomes have gained compared to the U.S. average at all points of
the income distribution — but inequality has widened.
■ Job opportunities and natural amenities are attracting households and talent Washington must focus on addressing three key areas, identified next, that
to all regions of the state. are currently the biggest barriers to Washington’s ability to achieve more
quality jobs, economic growth, and shared prosperity.
■ Housing production hasn’t kept pace with population or job growth, triggering
persistent affordability and homelessness crises.
■ Small businesses are struggling to compete for labor and access to resources Assessing Washington’s strengths, challenges, and opportunities lays the
in a changed economy. groundwork for future economic development strategies.
Strengths that have made WA a leader in business growth for decades
■ Talent attraction with consistent in-migration.
Equitable Outcomes Accelerate Economic Growth: ■ Strong Information and Communication Technology (ICT) presence and skilled tech labor.
Reframing Business Competitiveness Centered on Outcomes ■ Established, high performing network of public, private and training institutions.
■ Robust infrastructure and transportation system (including ports).
Focus on creating quality jobs and shared prosperity
■ Low energy costs, clean energy, natural assets, and amenities.
In order to track success, Washington needs to prioritize desired outcomes and develop
Challenges that threaten WA’s position as an economic leader
indicators that reflect a strong, balanced economy. After taking a hard look at traditional
■ Skilled labor shortages.
approaches to evaluating business competitiveness, this report suggests a revision that
■ Access to housing that is affordable to all workers.
incorporates updated values and tracks performance compared to peer regions.
■ Childcare affordability and supply limitations.
As Washington looks towards the future and sets a course for continued economic
■ The impacts of climate change.
growth, resiliency and inclusion need to be top state priorities. By dismantling barriers
■ Stable funding sources to support future infrastructure projects, including maintaining and
and expanding opportunities for low-income earners and communities of color, more
preserving current assets.
people can fully engage in the economy both as producers and consumers. This can
■ Access to capital for high-growth potential business.
translate into greater rates of entrepreneurship and economic growth, less reliance
on social supports, a greater tax base, and decreasing income and wealth disparities. ■ Complex and costly business and development regulatory frameworks.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth EXECUTIVE SUMMARY 2
Executive Summary | Big Idea 1
Build more housing of all types that are affordable to all residents.
KEY TAKEAWAY:
Washington State has the fewest number of housing units per
Why does this matter for economic development?
household of any state in the country. The underproduction of housing is limiting economic productivity and
growth, the creation of jobs, and perpetuating disparate outcomes
The Problem and wealth inequity for the next generation of Washingtonians.
■ Washington State has the fewest number of housing units per household of any
state in the country, and the housing crisis is getting worse as the number of units
built has not kept pace with household formation over the last decade.
■ The lack of supply puts strong upward pressure on home prices and rents. 44% of BY THE NUMBERS
Washington renter households are cost burdened and spend more than 30% of their
income on housing; 22% of renters are severely cost burdened and spend more than
50% of their income on housing.
■ Chronically undersupplied housing is the principal driver of the state’s homelessness
crisis. Washington’s homelessness rate—30 per 10,000 residents—is well above the
1.06
U.S. average (18 per 10,000 residents).
■ Homeownership is becoming more unattainable, particularly for BIPOC households.
The Black homeownership rate is 11.5% lower than the national average, which
11.5%
lower Black homeowership housing units per household
ranks last among peer states, and the 7th lowest nationally. rate than the U.S. average, last Washington State compared to
among peer states 1.14 nationally
Despite current efforts and legislative focus, Washington is still not building enough
homes, particularly homes that are affordable at lower and middle incomes, and that
provide wealth building opportunities for all.
$
190K $695K
The average new home
Number of units
Washington would need to build construction price statewide,
to achieve the national ratio the 6th highest of any state
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth EXECUTIVE SUMMARY 3
Executive Summary | Big Idea 2
Equip the workforce for success, and close the skills gap.
KEY TAKEAWAY: BY THE NUMBERS
Washington needs to train 200,000 more skilled workers
over the next 10 years to keep pace with job openings, a 30%
increase over current rates.
The Problem 25%
percentage of workers
2.5%
percentage of workers quitting their job
■ Businesses across the state are experiencing persistent and worsening labor
over age 55, an all time high monthly (30% annualized),
shortages. the 10th lowest state rate
• The number of job openings are at record highs, as is the share of the workforce
aged 55 and older.
■ There is a chronic gap in the training and skillset development of the workforce
across the state relative to labor need.
■ Annually there is a shortage of 20,000 skilled workers. Meeting this need would
221K 18,442
require a 30% increase in the number of certificates and degrees granted in the state.
• In-migration of skilled workers helps offset about half of the shortage within the
job openings statewide, active apprentices statewide in 2019,
state. 85% of those moving to the state have a bachelor’s or graduate degree,
a 40% increase from pre-pandemic an increase from 12,376 in 2015
leaving the largest deficit in the mid-level skilled workforce.
levels (2018 and 2019)
Despite current efforts to boost educational attainment, particularly in high-demand
fields such as STEM and health, there is a chronic gap between the skills employers
require and the skills with which job seekers are equipped. While strong workforce SKILLED WORKERS SUPPLY AND DEMAND GAPS
demand is seen at all education levels, particularly in STEM, workers with mid-level
training or education (associates, certificates, and apprenticeship completers) make up
half of worker need. In-migration helps offset the shortage, but is heavily concentrated in GRADUATE
workers with bachelor’s and higher levels of educational attainment.
BACHELOR’S
Why does this matter for economic development?
Businesses consider access to a skilled workforce when making MID-LEVEL
location decisions. A limited supply of skilled workers may prevent
- 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000
businesses from locating, expanding, or remaining in an area.
DEMAND CURRENT ANNUAL GRADUATES IN-MIGRATION
Source: 2017 Skilled and Educated Workforce Report
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth THREE BIG IDEAS 4
Executive Summary | Big Idea 3
Revitalize entrepreneurship (and make it easier to do business).
KEY TAKEAWAY: BY THE NUMBERS
61% 13%
Washington is forming 30% fewer high-growth potential
businesses than a decade ago, and ranks 4th lowest among
peer states. of Black-owned firms and of Black-owned firms and
The Problem 73%
of Hispanic-owned firms
20%
of Hispanic-owned firms
Declining Entrepreneurship and High-propensity Formation applied for PPP received all the financing
compared to 82% of they sought, compared to
■ Entrepreneurship has been on the decline nationally and in Washington over the
White-owned firms 40% of White-owned firms
past 40 years.
■ WA’s high-propensity business formation—those most likely to turn into a business
with a payroll—has declined 30% from the early 2000s (per capita), and now ranks
■ Land use and growth management has created an amenity value and produced
4th lowest among peer states.
environment benefits, but has also contributed to a limited number of available and
■ The economy has consistently performed well on traditional economic development suitable sites for business expansion.
indicators (capacity builders), but that has not translated into shared prosperity
■ The Wharton Residential Land Use Regulatory Index ranks the Puget Sound region
(realized outcomes).
as the 4th most regulated region in the country for permitting and land use, behind
■ Only one third of the jobs in the state pay enough for families to support their only New York, San Francisco, and Providence (Portland is ranked 10th).
living expenses.
Washington has historically performed well on traditional economic indicators and has
Limited Access to Capital leading businesses that have driven success for a subset of the population. However,
this success has masked growing problems—decreasing high-propensity business
■ There are a variety of barriers that are preventing businesses of all sizes from forming, formation fueled by inequitable access to capital and business supports, and a regulatory
growing, and competing in the global economy. environment that disproportionately hurts small businesses. Current initiatives and
• Venture capital is funding smaller deal sizes in Washington State than the programs are inadequate to address the extent of these problems.
national average.
■ Small businesses, particularly those owned by communities of color, have limited
access to capital needed to grow. Why does this matter for economic development?
■ BIPOC-owned firms were half as likely as White-owned firms to use a financial Declining rates of business formation, a trend accelerated by
services provider. complex regulations and limited access to capital, limits the
Burdensome Regulatory Environment potential for future economic expansion and shared prosperity
in Washington.
■ The variety of permits required from all levels of government are complicated, costly,
and time consuming.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth EXECUTIVE SUMMARY 5
Executive Summary | Where to Go Next
Where to Go Next
Measuring success
The status quo is currently not producing the desired outcomes. This report helps
identify and prioritize desired outcomes. In order to measure the progress on identified
outcomes of producing more quality jobs and creating opportunities to build wealth,
the state needs to commit to tracking metrics that can measure changes over time. As it
relates to wealth, there are limited data points that serve as proxies for wealth. If the goal
is for shared prosperity, additional resources must be devoted to producing metrics that
directly measure wealth outcomes in the State of Washington.
Policy options
Increasing housing production: Washington needs to build housing units
of all kinds in areas of high economic opportunity that are affordable and
provide wealth building opportunities. Areas of potential intervention include:
eliminating exclusionary zoning, options to build more housing units in Revitalizing entrepreneurship: Washington can no longer rely on its past
identified areas of high opportunity that leverage public investment, working successes to ensure its economic future. Washington needs to improve
with local governments to address misaligned fee structures and lengthy review targeted regulatory policies and business supports for firms that will create
processes, as well as clarifying and calibrating statewide growth management. quality jobs and wealth building opportunities. This includes supporting firms
Equipping workers with needed skills by enhancing technical programs with high-growth potential, improving access to capital for minority and low-
and apprenticeships: Maintaining the status quo is no longer an option income entrepreneurs, as well as simplifying regulatory requirements for small
for Washington State if it wants to continue to be a competitive force in the businesses. Doubling employment in the manufacturing industry statewide
national and global economy. While traditional degree attainment remains an (HB 1170, 2021) would improve high-propensity business formation, but
important part of workforce development, Washington needs to further explore specific policies need to be made to achieve this goal.
nontraditional skill delivery certifications and training, as well as alternative job
programs to address the growing gaps in mid-level skill quality jobs. Areas of
the greatest opportunities at the mid-level are expected to be in production Childcare and broadband access are important and known
and trades; business, management, and sales; human and protective service;
areas of need across the state. They are intentionally not
health professions; and computer and information science.
highlighted as priorities in this report given recent efforts at
the state and federal level to address these barriers. These
interventions and actions should continue to be monitored as
it will take time to measure the efficacy of these efforts and if
additional policy action is warranted.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth EXECUTIVE SUMMARY 6
1
INTRODUCTION,
FRAMEWORK, & EQUITY LENS
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
To Have a Competitive Business Environment, You Need an Accessible Economy
Understand your strengths, focus on your opportunities.
Prior to this report, it had been a decade since the State of Washington last looked at its It undertook a five months long engagement process speaking with elected officials,
business climate and how it compares to peer states. In that time we have seen multiple minority business owners, industry economists, tribal leaders, women’s groups,
disruptions: e-commerce expansion, airplane recalls, a pandemic, immigration shifts, Labor representatives, economic development professionals, chamber presidents,
jumps in inflation, and an unpredictable supply chain that can leave key components and unemployed workers, among others. The technical review looks at the State of
stuck in the Suez Canal. Some disruptions seem to arrive overnight and can be resolved the State, identifying key trends in the data that might have been overlooked in the
through flexible logistics or strategic partnerships. Others build slowly and present past, but suddenly become urgent areas of concern when putting them into context.
baseline costs that put the state at a strategic disadvantage. The focus of this study is the The Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis takes an in-
latter: what are key, foundational barriers that affect business competitiveness—whether depth look at key sectors and foundation items in Washington and highlights strategic
they be Fortune 500 companies or sole proprietorships—as they compete across the opportunities that could be pursued in the near term. In addition, it took into account a
state, regionally, and globally. hard look at traditional approaches to evaluating business competitiveness and a revision
This study takes a hard look at the Washington economy, scrutinizes traditional indicators suggested that incorporates updated values the state may include in future metrics. This
of success, and evaluates some common barriers to growth. The process was iterative will all be brought together in a summary of the most urgent needs and three ideas most
and gathered insight from diverse groups and through contrasting approaches. deserving of focused efforts.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth INTRODUCTION, FRAMEWORK & EQUITY LENS 8
Strong Economic Analysis Requires an Equity Lens
A rising tide does not always lift all boats.
As Washington looks towards the future and sets a course for continued economic Understanding the limitations of the datasets that we have access to, how they were
growth, resiliency and inclusion must be top state priorities. Building an expanded vision collected, who was left out, and how the survey design shaped the responses is critical in
for economic prosperity requires new tools, including a more nuanced set of metrics how we use and interpret data. Without a critical eye towards “the data” and what it can
for measuring success, wider definitions of business growth, and a better process for tell us, we risk finding false results in our analysis. To this end, we took the following steps
including voices from across the state. An equitable Washington economy helps to to ensure meaningful and accurate findings:
ensure that working-class people and people of color have quality jobs paying living
wages, access to the capital needed to build their wealth and their businesses, and a
role at decision making tables. Washington State’s diverse population includes workers,
entrepreneurs, innovators, and leaders all looking to increase their economic security
and mobility. Disaggregate data by race/ethnicity wherever possible (geographies,
ownership, etc.) to find where inequities exist.
This report is examining the state’s economy using a different research methodology
than has been used before. Our approach centers economic equity as critical to the
state’s vitality and growth and offers evidence-based findings that show where disparities Perform analyses that are intersectional in approach. How do race and
exist and what the state can do to reduce them. Because achieving equity is a complex ethnicity intersect with other identity categories that exacerbate or
goal, having good research strategies is an important first step. We used a racial equity mitigate economic mobility or access to resources?
approach in our research process to ensure we identified racial disparities, why they
exist, and how to address them. We also used this approach to help develop findings that Locate and utilize data sets from unconventional sources to help add
can be used to promote equity. This framework illustrates the circular nature of equity context to larger data analysis.
planning, decision-making, and implementation of actions. These methods guided the
team on what issues to look for in the data analysis and community engagement.
Maintain a strong commitment to interrogating our data sources,
sampling methods, and the validity of our analyses.
Recognize that data contains biases, and work to clearly document
and establish plans to mitigate bias within the data we maintain and in
how we use data to make decisions.
Use accessible and understandable visualization and communication
tools to share insights from our data to a wide range of audiences
across a variety of access needs.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth INTRODUCTION, FRAMEWORK & EQUITY LENS 9
2
STATE OF THE STATE
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
State of the State
Washington has transitioned its economy into a knowledge and tech leader.
This section will establish a baseline trajectory for businesses, industries, and INDUSTRY CLUSTER
geographies prior to the COVID-19 pandemic—then determine how they have been Education & Healthcare Professional & Business Services
impacted in Washington’s recovery to date. This will primarily focus on a quantitative Finance & Information Leisure & Hospitality
analysis to help frame trends and to contextualize the feedback received from industry Trade, Transportation, & Utilites Government
stakeholder outreach. This section investigates how the composition of industries has Goods-producing
changed in the last 30 years, identifies long run trends in workforce demographics,
3.0M
contextualizes the income distribution compared to the U.S. and regional peer
Industry cluster
states, explores the components of population growth, and investigates the housing
Average annual employment
Trade, Transportation,
and Utilities
affordability crises across the state. Professional and
2.0M Business Services
Government
Introduction
Education & Healthcare
Goods Producing
Finance and Information
1.0M
A generation ago, Washington’s economic Leisure and Hospitality
outlook was mixed. The immediately preceding
decades had been characterized by severe 0.0M
1990 2000 2010 2020
recessions, uneven job growth, and periods Year
of sizable out-migration in urban and rural Source: Employment Security Department Washington State
parts of the state. The wood products industry
was adjusting to federal harvest restrictions, Washington has been a leading U.S. job growth center
automation, and foreign and domestic during the past 30 years and successfully transitioned
competition. And the technology sector
into the knowledge economy
was taking hold but still in its relative early
stages. Per capita income hovered around the
Washington’s jobs fall into seven industrial supersectors: trade, transportation, and utilities;
U.S. average.
professional and business services; education and healthcare; finance and information;
But the state’s economic foundation—its human, physical, natural, and social capital— leisure and hospitality; goods-producing; and government. Every sector has grown over
was strong in 1990. A skilled workforce, highly regarded schools and universities, deep- the past three decades (see chart). This period
water ports, and talent-attracting natural amenities were in place. Over the next 30 will be remembered for the transition from
years, the state made a successful transition into a knowledge economy while resource industrial resources extractive activities to
extractive industries settled into important, supporting roles. Traditional economic knowledge-based work. Recent employment in
metrics—jobs, output, household incomes—pulled away from national averages. the goods-producing sector (manufacturing) is
Washington went from a middling performer to one of the most prosperous states in narrowly above its level in 1990. A combination
the nation. This generally positive economic story is marred by two critical failings: of factory automation and offshoring has led
highly unequal income growth across racial/ethnic groups and chronic housing to sharp sectoral losses nationally. The small,
underproduction. The state’s current economic performance could be summarized as a 4% increase in jobs over 30 years is better
period of prosperity inequitably shared. performance than most of the U.S.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth STATE OF THE STATE 11
State of the State
Growing the manufacturing and construction sectors provides an opportunity for quality jobs.
Which industry supersectors had the largest employment growth and specialized infrastructure, workers in these sectors are freer to choose high amenity
over the last 30 years? locations where they would prefer to live. And over the past three decades, Washington
has fared well in the competition for this work.
The education and healthcare sectors (eds and meds) experienced demographically-
driven, robust growth. An aging population drives demand in the healthcare sector Washington’s leisure and hospitality sector grew with the rest of the economy until
and, until recently, the children of baby boomers (the baby boom echo) supported March 2020 and then contracted sharply. The sector’s outlook is tied to public health
higher education enrollments. Both sectors are labor intensive, and many of the related conditions, which remain uncertain entering 2022. App-based restaurant ordering, hotel
occupations do not lend themselves to automation. self check-in kiosks, and other forms of automation will slow the sector’s job recovery and
drive demand for training by former industry employees.
The next two fastest growing sectors—professional business services and finance
and information—draw disproportionately on workers with bachelor’s and advanced
Manufacturing sector employment declined in the last 30 years,
degrees. Unlike the goods-producing sector, which needs access to particular resources
but less than the overall U.S. decline
WASHINGTON STATE SUPERSECTOR CHANGE IN EMPLOYMENT SINCE 1990 Within the goods-producing sector, the decline in manufacturing sector employment
almost completely offset the near doubling of the number of workers in the construction
240% 238% sector since 1990. Through the middle of the 2000s, the 20% manufacturing employment
decline in Washington matched the national rate—since then, employment recovered
220%
5% (pre-pandemic) compared to a further 8% decline nationally. In the last legislative
Average annual employment (% of 1990 level)
200%
session, HB1170 was passed with the goal of reversing this trend and aiming to double
193% Industry cluster the number of manufacturing jobs in the state.
191% Trade, Transportation,
and Utilities
180%
Professional andMANUFACTURING SECTOR EMPLOYMENT
Business Services
Government WASHINGTON STATE VS. U.S. CHANGE SINCE 1900 (INDEX 1990=100)
160%
154% Education & Healthcare
150% Goods Producing
140% Finance and Information
137%
Leisure and Hospitality
120%
104%
100%
1990 2000 2010 2020
Year
INDUSTRY CLUSTER
Education & Health Professional & Business Services
Finance & Information Leisure & Hospitality
Trade, Transportation, & Utilites Government
Goods-producing
Source: Employment Security Department Washington State Source: Federal Reserve Economic Data
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth STATE OF THE STATE 12
State of the State
Washington has a skills gap decades in the making.
WASHINGTON TOTAL JOB OPENINGS AND QUITS
QUITS OPENINGS
Source: Bureau of Labor Statistics, Job Openings and Labor Turnover Survey
The current workforce challenge is both
a retention and a recruitment problem
Early in the pandemic, the number of job openings dropped to the lowest level in a decade The share of the workforce aged 55+
as did the number of people leaving their jobs. By mid 2021, job openings increased to has more than doubled in the past two decades
record highs and the number of people quitting their jobs was in line with numbers for
Demographers and workforce developers have long anticipated an older workforce as
the few years leading into the pandemic. While the so-called “Great Resignation” is more
the baby boom generation aged. The youngest baby boomers turned 57 in 2021, and as
related to the rate of workers quitting as the unemployment rate increased, the larger
the generational cohort aged, the share of workers aged 55+ has steadily risen—from
change is the growing inability of firms to hire workers at all skill levels.
less than 10% in 1990 to almost a quarter in 2019.
More than half of Washington jobs are in big firms The share is growing for a number of reasons: the baby boomer generation is bigger
(500+ employees) than the generations that preceded it, people are living longer thanks to improvements
More than half of Washington workers (52%) work for a firm with more than 500 in healthcare, people are working longer because of insufficient retirement savings, and
employees—up from 42% in 1993. Employment shares in a number of small- to mid-sized some older Washingtonians are working more by choice.
firm categories (0–19, 20–49, 50–249, 250–499) all declined during the period. In 1990, An older workforce brings more experience, but also less predictability about ongoing
Washington had the highest share of employees in the 50–249 employment category participation rates and weekly hours. Businesses and their workforce development
when compared in a 20-state peer group. By 2020, Washington’s position fell to 12th. For partners must understand, and plan for, new dynamics—extended careers, late career
employment in the 500+ category, Washington went from 18th in 1990—ahead of only training needs, phased retirements, bridge jobs (e.g., a change in occupation or switch to
Idaho and Oregon—to 10th in 2020. part-time status), apprenticeships, and mentorship opportunities.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth STATE OF THE STATE 13
State of the State
Household incomes have pulled away from U.S. levels at all points of the income distribution. But inequality has widened.
In 2019, Washington household incomes were consistently above U.S. levels across Income inequality widened during the 2010s. The Palma Ratio, which compares
income distribution—from the 5th to 97th percentiles (see chart). The Washington- the aggregate incomes of high income households (i.e., top 10%) to low income
U.S. differences are highest at the lower end of household income thanks to strong, households (i.e., bottom 40%), increased from 2.35 to 2.55 at the state level. That
pre-pandemic economic conditions and the state’s minimum wage law. Washington’s means the top 10% of households had 255%—or more than 2 and a half times—
median (50th percentile) household income was 18% above the U.S. level in 2019. At the incomes of the bottom 40% in 2019. By contrast, Norway’s Palma Ratio is 1.0.
higher income levels, the Washington-U.S. differences gradually converge. The inequality measure rose in King, Pierce, and Spokane counties, but declined in
Clark County.
HOUSEHOLD INCOME DISTRIBUTION RELATIVE TO U.S. AVERAGE, 2019
130%
125%
CALIFORNIA
120%
118% WASHINGTON
110%
OREGON
100% U.S. AVERAGE
100%
90% 85%
IDAHO
80%
70%
60%
5 79 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97
Percentile
LOW INCOME MEDIAN INCOME HIGH INCOME
Source: PUMS 2019
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth STATE OF THE STATE 14
State of the State
Job opportunities and natural amenities are attracting households and talent to nearly every part of the state.
Key demographic indicators are becoming increasingly important measures of the state’s Interestingly, even Texas, which pulls people from much of the country, lost population
economic health. Washington and the U.S. have entered a period of low population to Washington on a net basis during the 2010s. And Washington has been migration
growth that’s expected to continue in coming decades. Nationally, the population neutral with Colorado, Idaho, and Nevada.
grew at its lowest rate in history during the 2010s—a function of an aging baby boom
cohort, low fertility rates, and tighter U.S. immigration policy. Many regions of the POPULATION California
CHANGE COMPONENTS, BY STATE
Colorado Idaho
country anticipate acute workforce shortages and declines in their prime-age working 2.00%
California Colorado Idaho
populations (25–54-year-olds). Prominent labor economists argue that workforce 2.00%
shortages—rather than job-eliminating automation—must be the top concern of 1.50%
policymakers and economic developers. 1.50%
1.00%
Washington’s migration story is a positive one. Every region of the state has attracted
1.00%
net migrants consistently since 1990. That was not the case in the three decades leading 0.50%
up to 1990 (see chart). The ability to attract population broadly in both urban and rural 0.50%
areas is uncommon across the U.S. and an advantage for Washington. 0.00%
% of population
0.00%
The migrants’ states of origin tell a story as well. Washington has drawn heavily from
% of population
-0.50%
California and Oregon—nearby states with similarly competitive natural amenities. The -0.50% Oregon Texas Washington
diversity of job offerings and, relative to California, lower housing costs are likely drivers. 2.00% Oregon Texas Washington
2.00%
1.50%
1.50%
1.00%
1.00%
0.50%
0.50%
0.00%
0.00%
-0.50%
-0.50%
20
2 1
2001
21 2
20 011
1 3
202021
21 4
20 031
1 5
20204 1
1 16
20 05
21 17
20206
11
20207 8
11
20208 9
12
20 9 0
2200
202 1 1
101
202 2
10
202 213
10
202 314
10
20 415
210
20 516
210
20 617
21
20 0718
2108
20 19
21
20 092
220 0
20 01
21 1
20 011
1 2
202021
21 3
20 031
1 4
20204
1 15
20 05
Year
21 16
20206
11
20207 7
11
20208 8
11
202 9 9
2002 0
Year
POPULATION CHANGE COMPONENT
Population change
Population component
change component
NATURAL INCREASE RESIDUAL NET MIGRATION
Natural Increase
Natural Increase Residual
ResidualNet
NetMigration
Migration
Source: Census Population Estimates
THE BOTTOM LINE: in a coming era that will be defined by slower population growth,
Washington appears well positioned to compete with its regional neighbors for
households and talent.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth STATE OF THE STATE 15
State of the State
Housing production has not kept pace with population or job growth, which has triggered affordability and homelessness crises.
NUMBER OF HOUSING UNITS BUILT PER NEW HOUSEHOLD FORMED FROM 2010-2020
Washington’s low production and high cost housing market drives the state’s
homelessness crisis. 22% of Washington renter households spend more than 50% of
their income on rent and are at increased risk of homelessness. High housing prices
also lock households out of home ownership. Differential homeownership rates are a
key contributor to large wealth gaps across racial/ethnic groups. Two-thirds of White
0.0 - 0.7 0.7 - 0.9 0.9 - 1.0 1.0 - 1.1
1.1 OR OVER N/A Washington households are homeowners—a higher share than any other racial/ethnic
group and more than twice the rate for Black households.
Source: U.S. Census, Washington Office of Financial Management
WASHINGTON STATE HOMEOWNERSHIP RATE BY RACE/ETHNICITY, 2019
The sustained success in job creation and population attraction has come with a price:
exceptionally high housing price inflation. The median home price to median household
income ratio (PTI) exceeds 6.0 along most of the I-5 corridor, approaches 8.0 in and around 70% 66.7%
Seattle, and stands at 6.7 in Spokane. The national PTI is 4.4. A household with median 59.8% NATIONALLY IT IS 42.6%,
60%
WA HAS THE 7TH L OWEST RATE
income can afford the median priced home in only nine of the state’s 39 counties—and 51.9%
50%
seven of those are east of the Cascades. 45.4%
40%
Population and job growth do not automatically translate into high housing prices.
31.1%
Many other U.S. regions have built housing to accommodate their growing economies. 30%
Washington hasn’t. In fact, Washington has the fewest housing units per household in
20%
the U.S.—Washington’s 1.06 units per household versus a U.S. average 1.14. The problem
was exacerbated by underproduction during the past decade when every county on the 10%
I-5 corridor, coastal counties, and several eastside counties built fewer housing units than 0%
WHITE ASIAN AND AMERICAN INDIAN AND HISPANIC OR LATINO BLACK OR
the number of households created. PACIFIC ISLANDER ALASKAN NATIVE AFRICAN AMERICAN
Source: Census 2019 ACS
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth STATE OF THE STATE 16
3
OUTREACH
& ENGAGEMENT
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
Outreach & Engagement
Identify gaps in outreach and develop strategy.
Outreach Approach Focus Group Approach
Gathering insight on economic goals, barriers, and issues for small businesses, employers, The consultant team worked together to develop a focus group plan and questions for
employees, and communities in Washington State required a robust outreach approach. participants. All focus groups began with an overview of the project purpose as well
This approach, facilitated through a neutral third-party facilitation and public outreach as necessary background information. The third-party facilitator led the discussions
firm, utilized a variety of outreach strategies to gather as many perspectives as possible by asking participants to share barriers to growth, community goals, potential state
in a short time frame. Focus groups were offered during standing (i.e., “go-to-you”) investments, and the definition of quality jobs. Focus groups were conducted online
meetings or at times requested by participants to streamline scheduling. The consultant using a virtual whiteboard as a visual aid to document participant feedback in real time.
team reached out to new and existing contacts and organizations, and provided Focus groups included:
pre-drafted emails for organizations to share with their networks to ease coordination
■ Washington State Commission of Asian Pacific American Affairs
and scheduling. Preliminary outreach included:
■ Contact with 16 organizations. ■ Washington State Women’s Commission (WSWC)
■ 25 stakeholder interviews. ■ WSWC Stakeholders
■ 10 focus groups.
■ Quinault Prosperity, Health, and Human Services Subcommittee
■ 2 surveys (distributed through organizations that were unable to hold focus groups).
■ Latino Education and Training Institute (LETI)
After the initial round of outreach, the consultant team implemented a follow-up
■ Washington State Labor Council (WSLC)
engagement strategy to reach additional communities and gather their perspectives.
Outreach included: ■ Seattle Metropolitan Chamber of Commerce REACH
■ Analyzing gaps in outreach and brainstorming additional stakeholders and
organizations.
■ Following up with focus group participants that indicated interest in hosting
additional focus groups.
■ Utilizing stakeholder connections and existing networks to convene additional
focus groups.
■ Sharing information about the project and purpose through introductory calls
with stakeholders.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth OUTREACH 18
Engagement and Outreach
Workforce development, cost of living, connectivity are large concerns.
Key Themes & Feedback
The following is a short list of key themes and systemic barriers that consistently The shift to digital work highlighted a need for reliable broadband
surfaced in focus group conversations; however, individual circumstances and specific and technological literacy.
barriers varied among participants. Focus group participants noted that small businesses, especially non-
English speaking, immigrant, or BIPOC-owned businesses, need resources
and support to navigate digital paperwork to actively participate in the
Infrastructure gaps create barriers to participate in the economy for growing economy. Limited access to broadband also impacts education
employees and employers. and learning opportunities.
Employers and employees face a variety of barriers that make it difficult High-quality education opens the door to high-quality jobs.
to access funding, assistance, and business support. This includes Limited access to affordable and high-quality education prevents
administrative requirements for small businesses related to paperwork, employees from accepting positions in areas with limited public schooling
licensing, and employment, as well as access to health care, childcare, options. Many employees cannot attend classes during weekdays or
quality jobs defined by flexible working hours to care for children or elders, working hours. Participants suggested providing more virtual classes and
mental health support, and cultural and linguistically specific support classes on the weekends, as well as courses in the primary languages of
and resources. perspective students.
Business-specific support and investments included improved
access to information and resources, access to capital and loans, Promote and provide vocational training opportunities early on.
support for community-based organizations that provide resources Vocational training tracks beginning in high school are needed to increase
for small businesses, incentives to contract with small or the amount of workers with needed skills, particularly in the trades,
minority-owned businesses, and streamlined and consistent labor and nursing, and physician assistant professions, among other specialized
contracting requirements. professionals. Focus group participants suggested increasing both in-
person and online vocational training opportunities, increasing resources
Lack of affordable housing impacts recruitment and retention. for this type of training, and investing in local community colleges.
Many participants indicated that the rising cost of housing is a significant
barrier for both employees and employers. This impacts communities’ Shifting economic priorities are causing workforce transitions.
ability to build generational wealth, which has broad-reaching cultural Employees need support to make career changes to respond to the
and social impacts. Rising housing costs can lead to workforce migration. changing economy (i.e., climate change focused jobs, remote working,
Employees can’t afford to live near their jobs or must work more than one etc.). Additional resources could include supporting the transfer of
job to afford housing. Employers indicated that commercial affordability titles or accreditations from different states or countries, supporting the
was also an issue. growth of transferable skills and transition between sectors, increasing
entrepreneurship and artistry programs, and clarifying pathways to
unemployment support.
For a list of focus group participants and notes, see Appendix.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth OUTREACH 19
4
SWOT SUMMARY
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
SWOT Summary
Washington has a diverse economy, with a variety of distinct challenges.
This chapter presents the findings from an assessment of Washington’s
strengths, challenges, and opportunities (a modified SWOT analysis). Washington Industries
Assessing Washington’s strengths, challenges, and opportunities lays
The SWOT analysis is conducted for 13 sectors of Washington’s economy:
the groundwork for future economic development strategies. The
SWOT analysis touches on the overall factors that reach into multiple
AEROSPACE: The aerospace sector is a major driver of economic activity in Washington State with more than 1,300
aspects of the economy and aims to identify themes that emerge across aerospace-related companies.
industry clusters.
AGRICULTURE & AGRIBUSINESS (including processing): Agriculture is Washington’s second-largest export
category, making the state a key supplier of food for export markets.
Overview
For the purposes of the modified SWOT analysis for Washington’s sectors, the CLIMATE/ENERGY: Washington State ranks 13th in the nation for clean energy jobs, with more than 85,000
as of 2020.
strengths, challenges, and opportunities can be characterized as:
FOREST PRODUCTS: Washington’s working forests sustain the third largest manufacturing sector in the state.
■ Strengths: specific assets and characteristics of the sector/
foundational item that separate it from competition and give it INFORMATION & COMMUNICATIONS TECHNOLOGY: The ICT industry employs roughly 278,000
an advantage. people across Washington, including software developers, computer systems analysts, and web developers.
LIFE SCIENCES/GLOBAL HEALTH: More than 1,100 life science firms and 170 global health organizations
■ Challenges: internal and external elements that represent a
reside in Washington, employing nearly 40,000 workers statewide, as of 2019.
weakness or threat to the sector/foundational item and could work
against a successful outcome. Challenges need to be acknowledged MARITIME: Maritime activities in Washington support a broad range of industries, including boat and ship building,
to be fixed or mitigated. recreational boat construction, commercial fishing and seafood processing, maritime logistics and shipping, and
passenger water transportation.
■ Opportunities: factors that the sector/foundational item can prepare
MILITARY, DEFENSE & NATIONAL SECURITY: In the past three years, businesses in Washington State
for to capitalize on or use to its advantage and to better achieve were awarded nearly $15 billion in contracts, roughly 4% of the state’s GDP.
stated objectives.
TRADE/LOGISTICS: It is estimated that 921,400 jobs were supported by trade (exports and imports) in
The SWOT analysis reflects regional input from across the state and Washington in 2017, approximately 28% of total statewide employment.
the best available data. The SWOT process involved the use of existing CONSTRUCTION (Housing, Commercial, Infrastructure): The state’s construction sector employs an estimated
industry studies and plans, and secondary data from several state and 223,000 workers.
federal sources. The State of the State and Business Competitiveness
Reports acted as the foundation of the review of strength, challenges, and HOSPITALITY/TOURISM: Historically, hospitality and tourism has been the state’s fourth-largest industry and
has employed more than 180,000 workers statewide.
opportunities. The analysis was bolstered by qualitative input from various
stakeholders, including industry experts and Department of Commerce MANUFACTURING: As of 2019, manufacturing employment was responsible for nearly 300,000 Washington jobs.
sector leads.
FINANCIAL SERVICES: The financial services cluster supports direct investment in Washington’s innovation
economy and presents opportunities for high-value job creation statewide.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth SWOT SUMMARY 21
SWOT Summary
Washington has excelled at attracting talent.
An established, high-performing network of public, private, and joint educational
Key cross-industry strengths and training institutions support nearly every major Washington sector. Washington’s
two largest universities, University of Washington and Washington State University,
Talent attraction, consistent in-migration support a large number of industries through their research initiatives, including
aerospace, agriculture, climate and energy, forest products, and life sciences.
Washington’s robust infrastructure and transportation system is another key strength
Strong ICT presence and skilled tech labor
the state possesses. Led by Washington’s robust system of ports and the maritime industry,
the state has become well established as a trade hub. The fluid transportation of imports
Established, high-performing network of public, private, and exports via water, road, and rail supports several Washington industries, including
and joint educational and training institutions the manufacturing, agriculture and agribusiness, and aerospace industries.
Energy costs in Washington State are among the lowest per kilowatt-hour of any U.S.
Robust infrastructure and transportation system state. Low energy costs are obtained through a range of renewable energy offerings and
competitively priced natural gas. Clean energy is a staple of Washington’s power grid,
which boasts the largest coordinated hydroelectric system in the world and continues
Low energy costs, clean energy
to see investment and research to advance current technologies. Industries leading
research in clean energy include forest products and agriculture (biomass and biochar),
maritime and aerospace (sustainable and alternative fuels), and ICT (technological
Natural assets and features
innovations in clean energy).
Washington’s natural assets include rich soils, diverse climates, a healthy supply of
water, robust forestland, extensive coast lines and river mileage, and natural deep-
Industries throughout Washington benefit from the state’s many assets and water ports. Washington’s proximity to western trade partners is another strength
unique resources. leveraged by many of Washington’s industries, including agriculture and agribusiness,
maritime, and trade and logistics. Washington’s expansive forestland, which includes
A key strength of the state has been the ability to attract a talented labor pool,
many national and state parks alongside extensive privately owned land, support several
and garner consistent in-migration. The interconnected nature of Washington’s
of Washington’s key industries. These industries include hospitality and tourism, forest
top industries has allowed the benefits of a large skilled labor force to be felt widely.
products, and construction.
Attracted through strong education and public institutions, in addition to global private
enterprises, the talented labor flowing into the state have especially benefited industries
requiring a highly skilled and tech-minded labor force.
Another cross-industry strength belonging to Washington is the strong ICT presence
and skilled tech labor force accompanying the ICT industry. Technology and innovation
have increasingly found a presence in industries throughout the state. Washington’s life
sciences industry has especially benefited, as artificial intelligence, cloud computing,
machine learning, and other technologies have gained footing within the industry.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth SWOT SUMMARY 22
SWOT Summary
Foundational challenges run across many industries.
The impacts of climate change present challenges for most industries in Washington
Key cross-industry challenges State. Extreme climate events can be costly to individuals and governments, as they
can disrupt factories, supply chain operations, and other infrastructure, and also disrupt
Skilled labor shortages transport. Climate volatility may force companies to deal with uncertainty in the price of
resources for production, energy transport, and insurance. Climate change, wildfires, and
rising sea levels will reshape where and when tourists travel.
Childcare supply limitations
New challenges for most industries throughout Washington State have emerged since
the start of the COVID-19 pandemic.
Climate change impacts
Pandemic impacts on the travel industry, including a lack of international coordination,
severe travel restrictions, and slower vaccination rates in some parts of the world
Pandemic impacts on the travel industry
continue to hamper the recovery of several industries in Washington, such as aerospace
and hospitality and tourism.
Pandemic impacts to global supply chains
Pandemic impacts to the global supply chains have shown that supply chains remain
vulnerable to shocks and disruptions, with many industries currently wrestling to
The rise in remote work during the COVID-19 pandemic overcome supply-side shortages and logistics-capacity constraints. The global supply
chain is likely to continue to undergo major changes; for example, relocating activities
outside of China. This may change the pattern of where entrepreneurs locate their
businesses, with whom they collaborate, how they define their own supply and value
Several foundational challenges were impacting Washington’s industries even chains, and how they source needed capabilities. The pandemic will continue to test the
prior to the pandemic. ability of most industries in Washington to adapt and improve supply-chain resilience.
Skilled labor shortage is a challenge faced by many industries in Washington State. The rise in remote work during the COVID-19 pandemic makes it easier for employees
Even prior to the pandemic, some industries like construction were suffering from a and companies to uproot. Startup founders are more likely to choose their HQ based on
lack of qualified workers due to factors such as an aging workforce, declining numbers personal and quality-of-life reasons. This has implications for housing, transit, and the
of skilled immigrants entering the workforce, lack of interest in blue-collar jobs among future of real estate.
young people, and competition with other higher-skilled industries. As Washington
is recovering from the COVID-19 recession, labor shortages are showing up in more
industries ranging from food service and warehouses, to accounting and finance.
Childcare supply limitations have emerged as one of the drivers for the labor shortage
impacting many industries statewide. Before the pandemic, over half a million children
ages 0-12 did not have access to licensed childcare in Washington State, according to an
industry assessment report from the state Department of Commerce. The pandemic has
made clear that the absence of reliable and affordable childcare limits which jobs people
can accept, makes it harder to advance, and restricts the ability of the state’s economy
to grow.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth SWOT SUMMARY 23
SWOT Summary
Opportunities remain in talent and technology.
Creating well-paying and high-demand jobs at all levels. As technology and
Key cross-industry opportunities innovation continues to reshape the global economy, creating a resilient economy will
depend on each industry’s ability to generate well-paying and high-demand jobs that
Restructuring workforce development reach all levels of the workforce.
and training systems throughout the state Washington’s remaining opportunities lie in the state’s historical success as a leader in
technology and environmental sustainability.
Closing workforce equity gaps Accelerate the clean economy and clean technologies. Current research surrounding
alternative and clean fuel technology is underway in the climate and energy, aerospace,
Creating well-paying and high-demand jobs at all levels maritime, manufacturing, and forest products industries. Mass timber has also continued
to gain traction throughout the state, supporting green initiatives within the forest
products and construction industries.
Accelerate the clean economy and clean technologies
Environmental sustainability, in addition to the advancements in clean energy
and clean fuels discussed above, present opportunities for many of Washington’s key
Environmental sustainability
industries. Prominent environmental sustainability opportunities include:
Innovations to maintain global leadership role in technology
■ Improving the efficiency and yield of agricultural production.
Many of the key cross-industry opportunities facing Washington pertain to the ■ Increasing the demand for more sustainably produced agricultural goods.
workforce of the future, including:
Restructuring workforce development and training systems throughout the ■ Wildfire prevention.
state. Through restructured or innovative workforce training programs, each industry
can skill up their respective labor forces to be prepared for the future of work. This will
■ Continued investment in green building initiatives.
likely be achieved through additional investment into workforce training and continued
partnerships with Washington’s higher education institutions, including the state’s robust
Community and Technical Colleges network. Continued innovations to maintain global leadership role in technology. Extending
beyond the state’s technology centered industries, which continue to build upon a strong
Closing workforce equity gaps. Through programs like Apprenti, started by the
history of innovation, are non-technologically centered industries investing in their
Washington Technology Industry Association, state registered apprenticeship and
own innovation. Benefiting from a strong tech workforce and educational institutions,
training programs can help underrepresented populations more easily enter an
Washington’s agricultural industry is a prime example of this innovation. Current
industry’s workforce. Construction, which has historically suffered from a workforce
technology advances are focusing on automation and drones working to enhance
lacking racial and gender diversity, could leverage existing training programs to increase
efficiency in water use, non-pesticide pest repellents, production density, storage,
diversity in their workforce while simultaneously addressing current and expected
and packaging.
shortages associated with an aging workforce.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth SWOT SUMMARY 24
5
REDEFINING
BUSINESS COMPETITIVENESS
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
Redefining Business Competitiveness
Existing definitions of business competitiveness oversimplify growth.
The Washington State Legislature wants to examine the state’s economic development practitioners understand what matters to economic competitiveness, the
competitiveness so that it can craft economic development policies and practices that first step towards a new state strategy is a shared understanding of how these rankings
yield strong, quality, and equitable growth in a challenging and tumultuous post- are flawed and why Washington needs a new definition of competitiveness. Below is a
COVID economic environment. The purpose of defining and assessing Washington’s summary of the three main types of rankings that tend to circulate in policy and advocacy
competitiveness is to shape the state’s strategy, including which policies are prioritized discussions and the ways in which each is flawed as a means of shaping strategy.
and how the state deploys its scarce economic development resources. This section
lays out a new and more actionable way for Washington leaders to think about the ■ Choosing every factor: national publications like US News and CNBC publish state
state’s competitiveness. economy rankings based on dozens of factors. This raises two problems. First, the choices
about how to weight these different factors are often opaque or misguided. The result is
arbitrarily weighting the “cost of doing business” as highly as education, technology, and
Redefining Business Competitiveness innovation combined (which runs counter to research on what drives quality, inclusive
to Drive Smarter Policy and Practice growth). Regardless of these methodological flaws, this “kitchen sink” definition of
There is no shortage of rankings that purport to measure the economic competitiveness competitiveness is not useful as a strategy tool because it does not highlight factors that
of states and regions. These rankings typically define competitiveness as some are most impactful and deserving of focus and investment. It may be that each of these
combination of the below factors. factors bears some relation to state competitiveness, but with limited budgets, which
should the state invest in?
Energy costs Small business formation
■ Choosing the wrong factors (low costs, business attraction): rankings that identify
a more specific set of factors that drive competitiveness, but that—according to
Export volume Education attainment
economic research—rely on the wrong factors. Rankings by industry publications like
“Area Development” assess states based on factors that are presumed to be important in
Innovation (patents, R&D) Access to capital business attraction projects. This definition of competitiveness is flawed because even if
it does capture the priorities of relocating businesses, that represents a small portion of
economic activity in any given year. What matters most to the few big firms that engage
Workforce attributes Taxes and regulations
in competitive site selection projects every year is unlikely to also be most important to
the other 95% of the economy.
Infrastructure Foreign direct investment
■ Choosing only some of the right factors (innovation): this approach is exemplified
by the Information Technology and Innovation Foundation’s “State New Economy Index”,
Health outcomes Environmental quality
which emphasizes outcomes like IT jobs, patents, and venture capital. Rankings like
these are more in-line with the research on what drives long-term growth in states, but
Each of these rankings reflects a different theory or definition of what drives economic this innovation-centric definition of competitiveness is flawed if the goal is to generate
competitiveness. Each of them is flawed as a guide for state policy and strategy—they quality and equitable growth. Many of these factors (e.g., patents or venture capital
cannot help Washington clarify its biggest economic opportunities or strategically investment) can be driven almost entirely by the top 1%–5% of firms. They do not reflect
focus its scarce resources to create strong, quality, and equitable growth across the an economy that is creating widespread, equitable opportunity—strong innovation
state. Because these rankings have powerfully shaped how policymakers and economic capacity is a necessary but insufficient condition for that outcome.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth REFRAMING BUSINESS COMPETITIVENESS 26
Reframing Business Competitiveness
Washington leaders must first define what outcomes they want to result from increased competitiveness.
Rankings each have their own particular shortcomings or gaps, but in summary they
fail as a tool for guiding strategy in at least one way:
■ Failing to identify what actually drives growth in a state economy: site selection,
for example, presumes that business attraction is the key input into a growing economy.
■ Failing to identify the type of growth that leads to quality jobs: innovation is a
key driver of long-run growth, but high performance on innovation does not necessarily
create an abundance of living-wage, middle-skill jobs.
■ Failing to elevate inclusion as a key driver of competitiveness: each of these rankings can claim to be the most “competitive” region in the U.S. But for a rural, mid-sized
relies on population-wide averages or medians, which fails to capture disparities—and manufacturer in a legacy industry with low profit margins, competitiveness may depend
closing racial disparities in education, job quality, and wealth is one of the most powerful on low taxes, low-wage labor, and port infrastructure. That’s why a state like South
ways that a state can improve competitiveness (whether defined in terms of innovation Carolina is in the top of competitiveness rankings focused on low costs and business
or business attraction). attraction “wins,” even though the state is struggling to gain a foothold in the innovation
economy, create quality jobs, and close racial disparities.
There are no objective, universal business
This means that existing competitiveness rankings are different not because one state
competitiveness metrics defined “competitiveness” correctly and the others failed to. Rather, the competitiveness
Why are there so many different, competing competitiveness rankings? Because each rankings are different because they define competitiveness with different types of
of these rankings is created with a certain type of business in mind. Area Development businesses in mind.
magazine presumes that businesses that relocate from one state to the other are In summary: existing definitions of competitiveness are not created to aid in the
most important; the Information Technology and Innovation Foundation presumes development of a strategy for strong, equitable, and quality growth, and any assessment
that technology businesses are most important. Some rankings are more grounded in of competitiveness begins with a decision of what businesses matter most. That
economic research, but ultimately there is no one “correct” assessment of a state’s means that Washington State needs to create a new definition of competitiveness that
competitiveness because there is not just one type of business. represents a clear choice about what businesses matter most. That does not mean
For example, for a small, high-growth software startup competitiveness may depend picking one industry over another. It means affirming that the businesses that matter
primarily on a rich pool of highly-educated tech talent, top computer science programs most are those that address the biggest needs of Washington residents: quality jobs and
at globally-relevant universities, and abundant venture capital. That’s why Silicon Valley equitable wealth creation.
The takeaway is that if the Washington State Legislature wants to organize around a portfolio of policies and investments that consistently produce
robust and inclusive growth, then it cannot rely on existing rankings to illuminate the path forward. The Legislature will need to redefine what economic
competitiveness means and how it is measured.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth REFRAMING BUSINESS COMPETITIVENESS 27
Reframing Business Competitiveness
A competitive economy should produce quality jobs and inclusive wealth creation opportunities.
While many rankings frame competitiveness as that which matters most to one industry
or another, from the perspective of state policymakers, competitiveness is simply the
ability of the Washington economy to consistently produce the outcomes that matter How different definitions of
most to people. Competitiveness is not a goal in its own right; it is a means to an end. competitiveness can shape strategy:
There is consensus among both policymakers and economic, workforce, and community Leaders in Birmingham, Alabama, were contemplating a major
development organizations about what outcomes matter—and this consensus is
investment in a precision medicine innovation initiative (a major
supported by research and data. The two most important economic problems that can
be addressed through business competitiveness are (1) lack of quality jobs, (2) limited strength of University of Alabama at Birmingham). They decided,
wealth-creation opportunities, and profound racial disparities in both areas. however, that given limited resources, their region’s competitiveness
depended more on closing racial disparities than on increasing patents
■ The quality jobs challenge and opportunity: quality jobs are generally defined as
living-wage jobs that do not require a four-year college degree. These jobs have been
or attracting PhD scientists. This different definition of competitiveness
disappearing as the economy has “hollowed out” due to trade and automation over reshaped their strategy—they instead invested in a population health
the past several decades. A decade of extraordinary growth in Washington did little to initiative that drew on some of the same strengths but would create
reverse this trend. Statewide, just over one in three workers has a quality job. more middle-skill, middle-wage jobs and improve health outcomes
■ The wealth creation challenge and opportunity: racial wealth disparities are far (and thus economic outcomes ) in Black communities.
larger than racial income gaps; these two phenomena are related, but each deserve
focus. Homeownership is a crucial source of wealth, as well as an indicator of broader
wealth disparities (for example, wealth in the form of a home can enable people to
pursue entrepreneurship or invest in businesses formed by others in their community). vs. workforce development vs. infrastructure investment), but there is near-universal
Communities of color in Washington only own 10% of firms with high-growth potential, agreement that a competitive economy should deliver these outcomes.
despite accounting for nearly 33% of the population. Washington lags behind many of There are businesses of all sizes, across industries and geographies, that are well-
its peer states in terms of high-impact entrepreneurship. Unleashing the entrepreneurial positioned to deliver these outcomes: from small BIPOC-owned tech firms that, with
potential of minorities is a crucial leverage point for the state. better access to capital, could become wealth generators, to large manufacturing
firms that provide quality jobs but need help innovating and reskilling to adapt to
These are widely recognized as the two deepest, most persistent, most harmful barriers new economic realities. The purpose of this definition of competitiveness is to turn the
to a strong, equitable economy in Washington that can be addressed through policies attention of state policymakers and practitioners towards these types of opportunities
and practices that work through businesses. These are not just unfortunate downsides to that most directly impact these key outcomes.
an economy that is functioning well—the lack of quality jobs causes lower productivity,
and the lack of wealth, particularly in communities of color, is a drag on the state’s ability
to create new, innovative, high-growth businesses.
Different organizations and stakeholders may have different theories as to which
interventions would most effectively combat these problems (small business support
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth REFRAMING BUSINESS COMPETITIVENESS 28
Reframing Business Competitiveness
Defining and measuring business competitiveness through realized outcomes and capacity builders.
We propose a three-part definition of competitiveness: one set of interrelated key realized
Flawed Assumptions
outcomes and two sets of key capacity builders. This definition is simple by design—it is
“… innovation is a proxy for broader economic health, because innovation drives
intended to be easy to communicate to a variety of stakeholders, apply in different policy growth and growth in turn creates quality jobs”, or “low regulation is a proxy for broader
and strategy contexts, and to serve as the basis for a simple dashboard of approximately economic health, because with less regulation entrepreneurs will flourish and create
10 metrics that the state could use to track its performance and shape policy decisions more quality jobs”.
over time.
Second, an emphasis on job quality helps illuminate what kinds of help businesses need.
Key realized outcomes Businesses have unlimited needs, but certain interventions are more likely than others to
Most definitions of economic competitiveness focus on proxies: “innovation is a proxy have an impact on the creation, retention, and diversification of quality jobs.
for broader economic health, because innovation drives growth and growth in turn Racial wealth disparity metrics help in one key way: Washington could create many more
creates quality jobs,” or “low regulation is a proxy for broader economic health, because competitive businesses if it eliminated race-based barriers to business creation. Business
with less regulation entrepreneurs will flourish and create more quality jobs.” Our new competitiveness is not just about addressing the needs of existing businesses; it is
definition of competitiveness skips past these assumptions—in part because Washington also about unleashing the potential of all Washingtonians so that more competitive
is extremely innovative, but only one in three workers has a quality job. If Washington businesses are created.
leaders and their stakeholders agree on what outcomes a healthy, well-functioning,
competitive economy should provide, then those outcomes—not proxies—need to be Key capacity builders
at the center of the discussion. These are the outcomes that Washington should track While a relentless focus on quality jobs and equitable wealth creation will go a long way
over time, relative to peer states. towards guiding policymakers and practitioners towards a competitiveness agenda that
Similarly, wealth creation can be an input to business competitiveness—most meets Washington’s needs, there are other factors that leaders should monitor.
entrepreneurs start businesses with personal or family savings, so more widespread ■ The first is talent. There are likely ways for Washington to increase quality jobs
wealth creation could unleash the potential of Washington’s “missing entrepreneurs.” and wealth creation in the near term without boosting education attainment (for
Research by Raj Chetty and colleagues has found that the U.S. could quadruple instance, helping mid-sized manufacturers upgrade their technology while upskilling
innovation if women, people of color, and people who grew up in low-income their existing workers). But in the longer term, these outcomes depend on a growing
households patented at the same rate as men who grew up in high-income households. and more diverse pool of talented workers. We refer to talent as an “enabler” rather
than a key outcome in its own right because there is abundant evidence that there
How does measuring outcomes for people help inform business- are disparities in job quality by race even after accounting for education—therefore
focused policies and practices? education is necessary but insufficient for inclusive growth.
Job quality metrics help shape strategy in two ways. First, certain industries and types
■ The second is innovation. Washington needs to equip companies that provide good
of businesses are richer in quality jobs than others and have greater growth potential;
jobs, and entrepreneurs of color, with the know-how and technology required to
elevating growth in quality jobs as a key outcome can therefore help policymakers
keep up with changing economic conditions and market trends. As with education,
understand whose competitiveness matters most. Then policies and investments can
we refer to innovation as an “enabler” because innovation alone cannot be counted
be targeted at improving the competitiveness of those particular types of businesses
on to deliver quality and inclusive growth—many innovative firms have few middle-
and industries.
skill and middle-wage job opportunities, and innovative industries can grow without
meaningfully diversifying their workforces.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth REFRAMING BUSINESS COMPETITIVENESS 29
Reframing Business Competitiveness
Outcomes and drivers at a glance.
Key
Realized Outcomes
Policies and investments
should be evaluated for A competitive economy produces abundant
whether they are likely to quality jobs and equitable opportunities to
achieve these outcomes. build wealth.
In a positive feedback loop, equitable access to quality jobs
and wealth-creation opportunities make the economy
more competitive through increased talent, innovation,
productivity, and more high-impact entrepreneurship.
Key
Capacity Builders
Necessary but insufficient
inputs to a competitive
economy. Investments A competitive economy is fueled by equitable A competitive economy continuously
in talent and innovation talent development. regenerates through innovation.
should be targeted at Human capital — the nation’s collective knowledge — is A competitive economy needs to be resilient. The firms
industries and businesses worth 10 times as much as all urban land in the country. that create quality jobs and generate wealth must have
that are most likely to create Education attainment is one of two factors (along with access to know-how and technologies that enable them
quality jobs and close patent rates) that explains most of the growing gap in to create new products and services and continue to
incomes across states. provide economic opportunity.
wealth disparities.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth REFRAMING BUSINESS COMPETITIVENESS 30
6
SURVEY & THEMES
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
Survey & Themes
Barriers to Business Growth – Emerging Themes
Firms struggle to find labor, TOP BARRIERS TO BUSINESS GROWTH IN WASHINGTON
labor struggles to find housing HOUSING 30% 25% 13%
Data analysis efforts highlighted trends within Washington’s economy, such as the WORKFORCE RETENTION / RECRUITMENT 34% 18% 15%
growth of eds and meds as well as the significance of the aging workforce. To gain a
CHILD CARE 7% 16% 15%
balanced understanding of the local economy, hearing directly from business owners,
9% 11% 13%
economic development professionals, elected representatives, economists, and SMALL BUSINESS REGULATION
other local actors was needed. Nine themes emerged from stakeholder outreach, OTHER (PLEASE SPECIFY IN NEXT QUESTION) 19% 11% 3%
research, and data analysis as potential barriers to business growth in Washington.
BROADBAND 4% 8% 16%
These themes included:
WORKFORCE TRAINING 3% 9% 9%
TRANSPORTATION 4% 3% 9%
■ Workforce Retention / Recruitment
SHIPPING INFRASTRUCTURE 6% 6%
■ Child Care TRANSITION TO AUTOMATION OR OTHER NEW TECHNOLOGY 3% 5%
0% 10% 20% 30% 40% 50% 60% 70%
■ Housing
TOP BARRIER 2ND BARRIER 3RD BARRIER
■ Broadband
Housing and Workforce Retention / Recruitment rose to the top of the list as key barriers
to business growth in Washington followed by childcare, small business regulation, and
■ Shipping Infrastructure
broadband. Respondents also wrote in other barriers, the most prominent of which were:
■ Transportation Government regulation—Respondents consistently described unclear or unnecessary
environmental mandates, burdensome COVID restrictions, and overreaching L&I
■ Transition to Automation regulation enforcement. Other respondents described frustration with frequently
changing and one-size-fits all regulations which do not account for business size
■ Workforce Training
or location.
■ Small Business Regulation Lack of business financial and technical assistance—respondents indicated need for
access to capital, especially when starting a business. Some noted a general need for
funding assistance. Respondents also noted that there was a lack of technical resources to
To vet these themes and ensure that they captured what businesses were experiencing help small business owners and that many business owners would benefit from training
on the ground, the consultant team developed a survey asking respondents to rank on financial literacy. In some cases, the assistance is available, but business owners do
key barriers to economic growth in Washington (see chart). The survey was distributed not know how to access it.
through the Washington Economic Development Association (WEDA) to economic The final themes emerging from the analysis show that the state is facing a handful of
development professionals first, then more broadly, and received 115 responses. structural issues that it cannot avoid any longer if it wants to remain a dynamic economy.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth SURVEY & THEMES 32
Survey & Themes
Themes: Cost of Living, Education, and Regulation
Housing “The supply [of housing] is currently dangerously low and not
Washington State has the fewest housing units per household of any state and the addressing this problem immediately via all mechanisms possible
housing crisis is getting worse.1 The underproduction of housing is limiting economic will bring disaster.”
productivity and growth, the creation of jobs, and perpetuating disparate outcomes of
wealth inequity for the next generation of Washingtonians.
Childcare
Washington has the 9th most expensive infant care of any state,2 and only 35 childcare
Workforce Replacement slots for infants, toddlers, or preschoolers for every 100 children whose parents work.3
Businesses of all sizes are struggling to find workers to fill vacancies. While this is partially Limited and unaffordable childcare prevents many parents from fully engaging in the
due to the pandemic, worker replacement will be a continuing problem as a large share workforce, restricting family economic advancement and employers’ ability to fill jobs.
of the workforce reaches retirement. Continued business growth, especially in STEM
and other high demand fields will further fuel the need for workers. Current workforce
development programs and initiatives are not enough to meet the growing need,
Broadband
projected to be 20,000 annually over the coming years, a 30% increase over current rates.
Over 338,000 Washingtonians lack access to a basic broadband connection, and many
Combined and replaced workforce retention / recruitment and workforce training, recognizing that
replacement is the challenge and training is the answer. more lack access to the speeds necessary to fully engage in an increasingly digital
world. Limited access to reliable, affordable, and fast internet prevents workers from
taking advantage of work from home opportunities or other training opportunities
that enhance economic mobility. Businesses that do not have adequate broadband
access cannot maintain a web presence or access certain services, which can impact
their viability.
High-growth / Innovative Firms
Entrepreneurship has been on the decline nationally and in Washington over the past 40
years. Of particular concern, Washington’s high-propensity business formation—those
most likely to turn into a business with a payroll and living wage jobs—have declined
30% from the early 2000s (per capita), and now rank 4th lowest among peer states.4
Washington remains competitive on most traditional economic development measures,
but low growth in high-propensity firms could indicate limited potential for future
economic expansion and shared prosperity.
1
U.S. Census, Washington Office of Financial Management Added due to stakeholder feedback and additional research acknowledging that certain businesses
2
Economic Policy Center Institute https://www.epi.org/child-care-costs-in-the-united-states/#/WA
drive economic growth.
3
Child Care Aware Data. (2019). https://www.childcareaware.org/our-issues/research/ccdc/state/wa/
4
Business Formation Statistics, U.S. Census
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth SURVEY & THEMES 33
Survey & Themes
Themes: Cost of Living, Education, and Regulation
Regulatory Environment Process of Prioritization of Themes:
The regulatory environment is limiting business formation and expansion. The Wharton
Residential Land Use Regulatory Index ranks the Puget Sound regions as the 4th most
regulated region in the country for permitting and land use. While Washington has made
some efforts to centralize and coordinate efforts across regulatory agencies and support
small businesses, businesses still struggle to keep up with regulations and access STAKEHOLDERS FOCUS GROUPS FINAL THEMES
developable land.
DATA GAP ANALYSIS
Encompasses small business regulation among other regulatory barriers to business of all sizes.
Access to Capital
Both new and existing businesses lack the capital they need to succeed. Barriers are
especially acute for people of color. While Washington is working to address this issue,
many programs are time limited, rely on consistent reallocation, and are inaccessible to
subsets of the population.
Came up both in written in survey responses as well as additional stakeholder outreach as a key
barrier to economic growth.
Final themes do not include:
• Shipping Infrastructure – determined to be largely a workforce shortage issue.
• Transportation – costs and commute times are largely due to lack of affordable housing near
employment centers.
• Transition to Automation – determined to be a driver of the increased need for skilled labor.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth SURVEY & THEMES 34
7
THREE BIG IDEAS
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
Big Idea #1
Build more housing of all types that are affordable to all residents.
KEY TAKEAWAY:
Washington State has the fewest number of housing units per
Why does this matter for economic development?
household of any state in the country. The underproduction of housing is limiting economic productivity and
growth, the creation of jobs, and perpetuating disparate outcomes
The Problem and wealth inequity for the next generation of Washingtonians.
■ Washington State has the fewest number of housing units per household of any
state in the country, and the housing crisis is getting worse as the number of units
built has not kept pace with household formation over the last decade.
■ The lack of supply puts strong upward pressure on home prices and rents. 44% of BY THE NUMBERS
Washington renter households are cost burdened and spend more than 30% of their
income on housing; 22% of renters are severely cost burdened and spend more than
50% of their income on housing.
■ Chronically undersupplied housing is the principal driver of the state’s homelessness
crisis. Washington’s homelessness rate—30 per 10,000 residents—is well above the
1.06
U.S. average (18 per 10,000 residents).
■ Homeownership is becoming more unattainable, particularly for BIPOC households.
The Black homeownership rate is 11.5% lower than the national average, which
11.5%
lower Black homeowership housing units per household
ranks last among peer states, and the 7th lowest nationally. rate than the U.S. average, last Washington State compared to
among peer states 1.14 nationally
Despite current efforts and legislative focus, Washington is still not building enough
homes, particularly homes that are affordable at lower and middle incomes, and that
provide wealth building opportunities for all.
$
190K $695K
The average new home
Number of units
Washington would need to build construction price statewide,
to achieve the national ratio the 6th highest of any state
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth THREE BIG IDEAS 36
Big Idea #2
Equip the workforce for success, and close the skills gap.
KEY TAKEAWAY: BY THE NUMBERS
Washington needs to train 200,000 more skilled workers
over the next 10 years to keep pace with job openings, a 30%
increase over current rates.
The Problem 25%
percentage of workers
2.5%
percentage of workers quitting their job
■ Businesses across the state are experiencing persistent and worsening labor
over age 55, an all time high monthly (30% annualized),
shortages. the 10th lowest state rate
• The number of job openings are at record highs, as is the share of the workforce
aged 55 and older.
■ There is a chronic gap in the training and skillset development of the workforce
across the state relative to labor need.
■ Annually there is a shortage of 20,000 skilled workers. Meeting this need would
221K 18,442
require a 30% increase in the number of certificates and degrees granted in the state.
• In-migration of skilled workers helps offset about half of the shortage within the
job openings statewide, active apprentices statewide in 2019,
state. 85% of those moving to the state have a bachelor’s or graduate degree,
a 40% increase from pre-pandemic an increase from 12,376 in 2015
leaving the largest deficit in the mid-level skilled workforce.
levels (2018 and 2019)
Despite current efforts to boost educational attainment, particularly in high-demand
fields such as STEM and health, there is a chronic gap between the skills employers
require and the skills with which job seekers are equipped. While strong workforce SKILLED WORKERS SUPPLY AND DEMAND GAPS
demand is seen at all education levels, particularly in STEM, workers with mid-level
training or education (associates, certificates, and apprenticeship completers) make up
half of worker need. In-migration helps offset the shortage, but is heavily concentrated in GRADUATE
workers with bachelor’s and higher levels of educational attainment.
BACHELOR’S
Why does this matter for economic development?
Businesses consider access to a skilled workforce when making MID-LEVEL
location decisions. A limited supply of skilled workers may prevent
- 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000
businesses from locating, expanding, or remaining in an area.
DEMAND CURRENT ANNUAL GRADUATES IN-MIGRATION
Source: 2017 Skilled and Educated Workforce Report
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth THREE BIG IDEAS 37
Big Idea #3
Revitalize entrepreneurship (and make it easier to do business).
KEY TAKEAWAY: BY THE NUMBERS
61% 13%
Washington is forming 30% fewer high-growth potential
businesses than a decade ago, and ranks 4th lowest among
peer states. of Black-owned firms and of Black-owned firms and
The Problem 73%
of Hispanic-owned firms
20%
of Hispanic-owned firms
Declining Entrepreneurship and High-propensity Formation applied for PPP received all the financing
compared to 82% of they sought, compared to
■ Entrepreneurship has been on the decline nationally and in Washington over the
White-owned firms 40% of White-owned firms
past 40 years.
■ WA’s high-propensity business formation—those most likely to turn into a business
with a payroll—has declined 30% from the early 2000s (per capita), and now ranks
■ Land use and growth management has created an amenity value and produced
4th lowest among peer states.
environment benefits, but has also contributed to a limited number of available and
■ The economy has consistently performed well on traditional economic development suitable sites for business expansion.
indicators (capacity builders), but that has not translated into shared prosperity
■ The Wharton Residential Land Use Regulatory Index ranks the Puget Sound region
(realized outcomes).
as the 4th most regulated region in the country for permitting and land use, behind
■ Only one third of the jobs in the state pay enough for families to support their only New York, San Francisco, and Providence (Portland is ranked 10th).
living expenses.
Washington has historically performed well on traditional economic indicators and has
Limited Access to Capital leading businesses that have driven success for a subset of the population. However,
this success has masked growing problems—decreasing high-propensity business
■ There are a variety of barriers that are preventing businesses of all sizes from forming, formation fueled by inequitable access to capital and business supports, and a regulatory
growing, and competing in the global economy. environment that disproportionately hurts small businesses. Current initiatives and
• Venture capital is funding smaller deal sizes in Washington State than the programs are inadequate to address the extent of these problems.
national average.
■ Small businesses, particularly those owned by communities of color, have limited
access to capital needed to grow. Why does this matter for economic development?
■ BIPOC-owned firms were half as likely as White-owned firms to use a financial Declining rates of business formation, a trend accelerated by
services provider. complex regulations and limited access to capital, limits the
Burdensome Regulatory Environment potential for future economic expansion and shared prosperity
in Washington.
■ The variety of permits required from all levels of government are complicated, costly,
and time consuming.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth THREE BIG IDEAS 38
APPENDIX A
SWOT INDUSTRY CUT SHEETS
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
Appendix
SWOT Sector Cut Sheets | Aerospace
AEROSPACE PRODUCTS AND PARTS MANUFACTURING JOBS,
WASHINGTON STATE
120
113.0 113.8
112.0
110.4
105.1
101.3
100 98.3
96.0
94.2 93.9 93.8
90.7 90.8
88.5
86.4 86.2 87.2 86.6
82.9 82.9 84.0 83.4
80.2 80.0 80.8 80.0
80
75.7
73.2
67.7
65.3 65.6
61.4
60
40
20
0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
(EST.)
Source: Bureau of Labor Statistics, 2021; Community Attributes, 2021.
STRENGTHS
■ Boeing assembly lines and related facilities; production increases
Washington’s aerospace sector has a long history in the state, starting with the founding in Renton anticipated
of The Boeing Company in 1916. More than 1,300 aerospace-related firms are located in
■ Skilled aerospace workforce and a strong training and education
Washington State, primarily in Snohomish, Spokane, and King counties. Washington State
network
aerospace companies are vital links in the global supply chain for aircraft manufacturers
around the world. Washington is second only to California in hosting US companies ■ Robust supply chain and related infrastructure
that supply parts to Airbus. Prior to the pandemic, the aerospace products and parts ■ Defense contracts
manufacturing sector employed more than 88,000 workers throughout the state.
■ Competitive tax and incentive environment tuned for aerospace
Another 40,000+ workers were employed in related industries with strong overlapping
services and linkages with the core aerospace sector.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | AEROSPACE 40
Appendix
SWOT Sector Cut Sheets | Aerospace
CHALLENGES OPPORTUNITIES
■ Most aerospace sector strengths are Boeing derived ■ Proactively pivoting to the state’s entrepreneurial commercial
■ Continued pandemic impacts on the travel industry space industry
■ Managing and retaining a diverse workforce ■ Remaining at the forefront of emerging clean fuel technologies
■ Aerospace is a mature industry with declining long-term ■ Supply chain innovations to help create a more resilient sector
projections ■ Continued innovations in maintenance and repairs driven by
technological advancements in robotics and augmented and
mixed reality
■ Capacity utilization at Paine Field
■ The New Market Aircraft (NMA)
Florida’s proactive pivot towards commercial space.
Space Florida, created in 2006 to serve as Florida’s aerospace economic development
organization, has worked to drive economic development across the global aerospace
and commercial space sectors. This has been followed by continued investment, research,
and exploration of the commercial space sector. Today, Florida’s commercial space
industry boasts a rocket launching and landing site at the Cape Canaveral Spaceport,
manufacturing of rocket engines in West Palm Beach, and small satellite development in
Gainsville. Additionally, major commercial space companies currently with operations in
Florida include SpaceX, Blue Origin, and OneWeb Satellites.
Source: https://www.spaceflorida.gov/
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | AEROSPACE 41
Appendix
SWOT Sector Cut Sheets | Agriculture and Agribusiness
TOP 10 COMMODITIES, WASHINGTON STATE, 2020 (MILS $)
APPLES $2,095
MILK $1,193
WHEAT $949
POTATOES $753
CATTLE $693
CHERRIES $562
HAY $501
HOPS $445
GRAPES $302
EGGS $220
Source: Washington State Department of Agriculture, 2021; Community Attributes, 2021.
STRENGTHS
■ Washington’s natural features
■ Proximity to and demand from Asian markets
Washington’s agriculture and agribusiness industry is supported by 15 million acres
■ Diversity in highest production crops
of farmland. Washington produces more than 300 commodities, and is the leading
producer of apples, hops, cherries, and more. Agriculture is Washington’s second- ■ Leader in specialty crops, including seafood
largest export category, making the state a key supplier of food for export markets. ■ Infrastructure and transportation system supporting agricultural
Overall, the industry supports more than 164,000 jobs in Washington (2013), and 35,700 exports, notably the state’s extensive ports network
farms of which 89% are small farms, as well as more than 200 food processing companies ■ Partnership with Washington State University
(2017). Agriculture and food manufacturing are spread throughout the state, supporting
jobs in rural communities as well as food manufacturing jobs in urbanized areas.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | AGRICULTURE AND AGRIBUSINESS 42
Appendix
SWOT Sector Cut Sheets | Agriculture and Agribusiness
CHALLENGES OPPORTUNITIES
■ High-risk sector depending on factors beyond a farmer’s control ■ Increasing consumer demand for non-conventional types of
■ Impacts of climate change production, such as organic, local, sustainable, free-range, and
grass-fed products
■ Access to resources, including land and water
■ Enhance marketing, statewide and commodity-based, to increase
■ Historically and increasingly low margins industry demand for both conventional and non-conventional agricultural
■ Regulatory framework acting as a barrier products
■ Labor shortages faced by both labor-intensive crop producers, as ■ Research and innovation in automation and drones to increase
well as food manufacturers efficiency and address labor shortages
■ Financial pressures on smaller farms who can not scale ■ Technology innovation and data resources to enhance efficiency,
operations including water use, monitoring of production density, as well as
storage and packaging
■ Pandemic disruptions to the food distribution network
■ Capacity for growing the wine and craft beer markets
U.S. universities focusing on innovation in agricultural automation.
Washington State University, in partnership with the U.S. Department of Agriculture-
National Institute of Food and Agriculture, is leading the AgAID Institute—a multi-
institutional research institute to develop aritifical intelligence solutions to tackle some
of agriculture’s biggest challenges. In total, 17 land-grant universities located throughout
the U.S. are working together to develop innovative automated systems for agricultural
production, specifically focusing on labor-intensive crops. For example, the University
of Florida has developed a robot that counts and maps fruit in citrus trees, while the
University of California-Davis has developed a fruit picking cart with instruments that
can map orchard fruits. Iowa State University is working to manufacture technology that
reduces pesticide drift, Washington State University developed drones to deter birds
that prey on fruit crops, and the University of Hawaii has given coffee growers handheld
devices that can spot leaf water stress and optimize irrigation.
Source: https://www.usda.gov/media/blog/2020/08/27/automation-helps-solve-specialty-crop-challenges
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | AGRICULTURE AND AGRIBUSINESS 43
Appendix
SWOT Sector Cut Sheets | Climate and Energy
CLEAN JOBS SHARE OF TOTAL COUNTY EMPLOYMENT, 2022
CLEAN ENERGY JOBS BY DENSITY (CLEAN ENERGY JOBS PER 1,000 TOTAL JOBS)
11–13 14–17 18–19 20–23 24–27 28–35 36–64
Source: Washington State Department of Agriculture, 2021; Community Attributes, 2021.
STRENGTHS
■ Expansive hydroelectric system
As state and federal policy continue to increase focus on addressing climate change,
clean energy jobs present an important opportunity for Washington State. Statewide,
■ 100% clean energy goal set for 2045
one in 50 workers in the state were employed in the clean energy industry in 2019, 11 ■ Local education and research institution partnerships
times more than in the state’s fossil fuel sector. Washington’s clean energy economy is ■ Support from other industries in the state
driven primarily by growth in energy efficiency, grid modernization, energy storage, and
■ Continued commitment to invest in clean-tech R&D, energy
clean fuels. The state’s abundant water resources provide significant renewable energy
innovation, and support existing clean energy businesses (e.g.,
resources. However, to reach the state’s goal of 100% clean energy by 2045, emerging
Clean Energy Fund)
technology and innovation will be vital.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | CLIMATE AND ENERGY 44
Appendix
SWOT Sector Cut Sheets | Climate and Energy
CHALLENGES OPPORTUNITIES
■ Ensuring an equitable transition to clean energy for rural, low- ■ The Infrastructure Investment and Jobs Act proposing significant
income and communities of color and for all workers impacted investments in clean energy
by electrification efforts ■ Battery technology for energy storage
■ Ensuring resource adequacy ■ Biofuels, biomass, mass timber, and cross laminated timber
■ Recruiting and retaining skilled workforce ■ Aging existing infrastructure, providing a business opportunity
■ Grid modernization for replacement
■ Statewide access to broadband as a factor in reaching state and ■ Smart cities initiatives
federal energy goals ■ Trade alliances and regional branding of Pacific Northwest clean
■ COVID-19 impacts on clean tech jobs energy sector
Continued expansion in California’s battery storage system.
California is leading the nation in battery storage facilities and gained more capacity with
a recent expansion finished in September 2021. Paired with the wind and solar energy
generated within the state, California’s use of lithium-ion batteries has successfully
provided substantial support to the power grid and is accelerating the transition to clean
energy. As of June 2021, California had 1,438 megawatts of utility-scale battery storage
capacity, 1,000 megawatts more than the next closest state’s battery storage capacity.
California is poised to continue their world leading build out of ion-battery storage
as they work towards a legislative goal to provide 100% renewable and zero-carbon
electricity by 2045 and continue to alleviate stress on a power grid that can suffer during
peak consumption times.
Source: https://insideclimatenews.org/news/02092021/inside-clean-energy-california-energy-storage-vistra-corp/
https://www.energy.ca.gov/news/2021-03/california-releases-report-charting-path-100-percent-clean-electricity
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | CLIMATE AND ENERGY 45
Appendix
SWOT Sector Cut Sheets | Forest Products
TIMBER HARVEST, WASHINGTON STATE
8,000
7,050
7,000
6,000 5,850
5,000
4,330 4,380
4,000
3,320
3,180
3,000 2,760
2,220
2,000
1,000
0
1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017
OTHER PUBLIC LANDS FEDERAL LANDS STATE LANDS PRIVATE LANDS
Source: Washington State Department of Natural Resources, 2021; Community Attributes Inc., 2021.
STRENGTHS
Washington State’s forestry industry stretches across the state, with concentrations in ■ Millions of acres of publicly and privately owned forestland in
Western Washington and the Olympic Peninsula. the state
Across the state there are 22 million acres of forestland, of which 4 million acres are ■ Historically a foundational sector in the state economy
privately owned. Roughly 70% of timber comes from private forests. Washington’s forest ■ Important resource for rural economic development
products sector encompasses a broad range of business lines, from traditional cutting
■ Diversified sector encompassing all phases of the supply chain
and lumber production, to pulp and paper and value-added products.
■ Local educational institutions supporting innovation through
Forestry and forest products supported about 42,000 workers statewide in 2017, earning research
nearly $3 billion in wages per year. Washington’s working forests sustain the third largest
manufacturing sector in the state.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | FOREST PRODUCTS 46
Appendix
SWOT Sector Cut Sheets | Forest Products
CHALLENGES OPPORTUNITIES
■ Declining employment due to technological innovation, the ■ Wildfire prevention, such as fuel reduction, forest management
recession in the 1990s, trade barriers and/or foreign competition, and thinning
and increasing forest and environmental protections ■ Increasing demand for mass timber and cross laminated timber,
■ Wildfires driven by climate change, threatening the supply of as a result of changes in legislation and building codes
timber resources ■ Biomass as a renewable energy resource
■ Workforce shortages ■ Enactment of HB 2528 into law as an opportunity for the forestry
■ Urbanization and loss of forestland available to harvest and forest products sector to expand its services and contribute
■ Declining resources to support publicly owned forestland to the state’s climate goals
Oregon’s established mass timber manufacturing.
Oregon boasts large operations in timber product processing and mass timber
manufacturing. CutMyTimber, with an office in Portland, was deemed one of the
largest timber product manufacturers in the United States by the U.S. Forest Service.
Additionally, Oregon possesses numerous mass timber manufacturers including Freres
Lumber, Rosboro, and DR Johnson. Rosboro is the largest producer of Glulam beams
in North America, while DR Johnson was the first United States company certified by
the American National Standards Institute to manufacture CLT panels. Oregon State
University’s College of Forestry is also heavily involved in mass timber research.
Source: https://www.archpaper.com/2021/04/2021-timber-map/
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | FOREST PRODUCTS 47
Appendix
SWOT Sector Cut Sheets | Information and Communication Technology
NET TECH EMPLOYMENT, WASHINGTON STATE
450,000
400,600 405,800
400,000 381,400
355,100 365,300
350,000 341,100
300,000
250,000
200,000
150,000
100,000
50,000
0
2015 2016 2017 2018 2019 2020
Source: CompTIA, 2021; Community Attributes Inc., 2021.
STRENGTHS
Washington State is the birthplace of legendary businesses like Microsoft, Amazon,
■ Microsoft and Amazon (anchor employers)
F5 Networks, Zillow, and Expedia. The Information and Communications Technology ■ Diverse base of high-tech companies
(ICT) industry employs roughly 278,000 people across Washington, including software ■ High employment growth over the past decade
developers, computer systems analysts, and web developers. The largest concentration
■ Ecosystem of innovation supported by world-class universities
of these workers are in Seattle and King County’s eastside, particularly the Innovation
Triangle (Bellevue, Redmond, Kirkland). An additional 271,000 workers are employed ■ Strong talent base and talent recruitment
in tech occupations across other industry sectors in Washington State. Over the last 10 ■ Growing startup community
years, tech employment in the state grew by 34%.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | INFORMATION AND COMMUNICATION TECHNOLOGY 48
Appendix
SWOT Sector Cut Sheets | Information and Communication Technology
CHALLENGES OPPORTUNITIES
■ Lacking high-tech manufacturing subsector ■ Expand artificial intelligence (AI) activity and reap broader
economic benefits from AI
■ Pandemic impact on recruiting, relocation, and workplace
choices ■ Pandemic driven increase in the trend of gaming and spending
on gaming as an avenue for future growth in the video game
■ Urban centers struggle to rebound from the pandemic
industry
■ Extensive gender and racial inequities
■ Leveraging the tech sector and public-private partnerships to
■ Tensions between tech and local government, with an impact on drive workforce development
policies and taxes that target the industry directly
■ Housing affordability, homelessness, gentrification, and traffic
Louisville’s workforce development gains in ICT.
Through a program named LouTechWorks, six universities were brought together,
alongside Jefferson County Public Schools, Code Louisville, and Tech Louisville to help
accelerate growth within the local tech pipeline. Such workforce development has
been associated with a positive loop effect, supporting growth within local firms and
ultimately creating more jobs. LouTechWorks was started to help support a growing tech
industry in Louisville. From 2016 to 2019, the number of tech jobs in Louisville, Kentucky
grew by 28%, a higher rate than peer cities Nashville, Raleigh, and Indianapolis. Despite
being launched in 2019, LouTechWorks has seen immediate success. For example, 62%
of high school students now have access to computer science related coursework, 590
graduates of Code Louisville have been placed in tech jobs, and tech-related degree
completions have increased by 37% in the region.
Source: https://www.bizjournals.com/louisville/news/2021/04/16/tracking-louisvilles-tech-talent-development-prog.html
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | INFORMATION AND COMMUNICATION TECHNOLOGY 49
Appendix
SWOT Sector Cut Sheets | Life Science and Health
NET TECH EMPLOYMENT, WASHINGTON STATE
125
120
INDEXED EMPLOYMENT (2015=100)
115
110
105
100
2015 2016 2017 2018 2019
WA PRIVATE SECTOR WA LIFE SCIENCE US LIFE SCIENCE
Source: Life Science Washington, 2021. https://lifesciencewa.org/wp-content/uploads/2021/10/Economic-Impact-
Report_2019data.pdf
STRENGTHS
More than 1,100 life science firms and 170 global health organizations are located in ■ One of the top 10 life science clusters in the United States
Washington, employing nearly 40,000 workers statewide as of 2019. The average annual ■ Strong job growth (23.5% from 2015 to 2019)
wage for life science jobs in Washington was $106,000 in 2019. The Seattle-Bothell ■ Strong venture capital funding growth
area houses a substantial amount of life science firms, while the Spokane area has
■ Growing startup community and expanding lab and R&D space
implemented an economic development strategy to create robust health care and life
sciences growth. Washington’s Life Sciences and Health sector boasts top research ■ Top STEM-based industry for women (women make up 44% of
institutions such as the Gates Foundation, the Fred Hutchinson Cancer Research the industry)
Center, the Allen Institute, the Seattle Cancer Care Alliance, and the Pacific Northwest
National Laboratory.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | LIFE SCIENCE AND HEALTH 50
Appendix
SWOT Sector Cut Sheets | Life Science and Health
CHALLENGES OPPORTUNITIES
■ Competition for labor with ICT and aerospace ■ rDNA technology
■ Limited connections between the industry and Washington’s ■ Future pandemic preparedness
colleges and universities ■ Intersection of big data with population health research and anti-
■ Engaging diverse populations that are typically under- microbial resistance
represented in life sciences and STEM-related fields ■ Emerging areas of innovation like agricultural and marine
■ Affordability of office and lab space biosciences, precision medicine, and digital health/health
information technologies
■ Decreasing government support and a lack of tax incentives
■ Translating research into industry-led R&D and related job
growth
Digital health cluster focus in Massachusetts.
Digital health was identified as an emerging industry cluster in 2015 by the Commonwealth
of Massachusetts. As a result, in early 2016, Massachusetts established a Digital Health
Initiative to further strengthen the state’s digital health ecosystem. The Initiative is a
collaboration of the state’s public, private, academic, and healthcare leaders. For the past
six years, the collaborative digital health initiative has been focusing on attracting and
retaining digital health firms. As of 2020, Massachusetts ranked as the #2 destination in
the U.S. for digital health investment and contained more than 350 digital health firms.
Source: https://massdigitalhealth.org/ehealth-cluster/initiative
https://masstech.org/sites/mtc/files/images/Test/Digital%20Health%20Pitch%20Deck.pdf
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | LIFE SCIENCE AND HEALTH 51
Appendix
SWOT Sector Cut Sheets | Maritime
WASHINGTON’S MARINE CARGO PORTS
CANAD A
G
eo
rg
ia
St
ra
it
97
N ORTH C ASCADES
Bellingham Bellingham
N ATIONAL P ARK C OLVILLE
N.F.
Anacortes 20
River
St
ra
it o mbia
f Ju 21
an de Fuca
Colu
M T. La
5 395
B AKER- S NOQUALMIE ke
Port Angeles C
N.F. hel
an
25
Everett River
O KANOGAN- S
p ok
ane
O LYMPIC L a ke
W ENATCHEE
N ATIONAL N.F. ks Spokane
P ARK Ban
Seattle 2
Seattle
101
90
Tacoma 90
n 410
Grays Harbor Olympia
Ocea
Potholes
Olympia Reservoir
M T R AINIER
N ATIONAL P ARK
ver Whitman County
Ri
Pacific
Yakima e
iver
k
C o w litz R
a
Sn
5
Garfield
82
Benton Clarkston
Pasco
G IFFORD 12
Longview P INCHOT
Tri- Cities Walla Walla
Kalama er
N.F.
Ri v
wis
Le
Klickitat
Ports of Washington
Vancouver
Vancouver Railroads
Marine Terminals
0 12.5 25 50 Miles
Or ego n Source: CAI 2016, WPPA 2016
WSDOT 2013
Se rvice Laye r Cr edits:
STRENGTHS
Maritime activities in Washington are diverse, extending across multiple corners of the ■ Natural features (coastline, river mileage, deep-water ports)
state’s economy, and include boat and ship building, recreational boat construction,
commercial fishing and seafood processing, maritime logistics and shipping, and
■ Proximity to western trading partners
passenger water transportation. 75 public ports are spread throughout 33 of Washington’s ■ Engaged with a diverse set of industries
39 counties, connected by 3,200 miles shoreline and 50,000 miles of rivers and streams. ■ Well built out maritime infrastructure
Washington’s maritime industry employed about 70,000 statewide and encompassed
■ Focus on sustainability (Maritime Blue strategy) and innovation
2,300 companies in 2015.
(Port of Seattle Maritime Accelerator program)
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | MARITIME 52
Appendix
SWOT Sector Cut Sheets | Maritime
CHALLENGES OPPORTUNITIES
■ Keeping pace with infrastructure updates to address industry ■ Washington State’s Department of Commerce’s Maritime Blue
changes Strategy for 2050
■ Access to capital for research and development in the maritime ■ New maritime innovation, such as advanced metering of
industry mechanical and fuel systems, the electrification of ferry fleets,
and clean energy technologies tied to maritime projects
■ Competition from other ports, such as west coast, Gulf Coast, and
and vessels
Midwest ports
■ Recapitalization of the fishing fleet
■ Geographic shift in cheap manufacturing labor
■ Climate change impact on fisherman and their local communities
■ Pandemic impacts on the supply chain
■ Aging maritime workforce
Maritime biofuel research in Tennessee.
Oak Ridge National Laboratory, located in Tennessee, is the largest multi-program
science and energy research lab in the United States. A team of Oak Ridge’s scientists is
leading a multi-laboratory study testing the feasibility and use of biofuels for cargo ships.
Since the team first examined the use of biofuels in 2018, they have begun engaging
with industry leaders such as Exxon Mobil to gain interest. Initial results have been
promising, suggesting blended bio-oil and heavy fuel oil could be suitable for use as fuel
for maritime cargo vessels.
Source: https://www.ornl.gov/
https://www.energy.gov/eere/bioenergy/articles/anchors-aweigh-examining-biofuels-maritime-shipping
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | MARITIME 53
Appendix
SWOT Sector Cut Sheets | Military, Defense, and National Security
DEFENSE SPENDING AS PERCENTAGE OF STATE GDP, WASHINGTON STATE
3.5%
3.0%
3.0% 2.9% 2.9%
2.7%
2.5%
2.5% 2.4%
2.0%
1.5%
1.0%
0.5%
0.0%
2015 2016 2017 2018 2019 2020
Source: Bureau of Economic Analysis, 2021; U.S. Department of Defense, 2021; Community Attributes Inc., 2021.
STRENGTHS
Washington’s military, defense, and national security sector possesses nearly 100,000 ■ Second largest public employer in Washington
active duty, reserve, guard, and civilian personnel and the state houses an additional
■ Connection to key Washington industries
600,000 veterans. Washington’s military installations are primarily located in the Puget
Sound Region, while the Fairchild Air Force Base is located in Spokane. ■ Current military, defense, and national security presence
In the past three years, businesses in Washington State were awarded nearly $15 billion ■ Military infrastructure
in contracts, which represented roughly 4% of the state’s GDP. Nearly 2,000 businesses ■ Six active-duty military installations
provide support to the military and defense sector, with some of the largest military
■ Federally funded laboratories that pursue training and research
contractors such as Boeing, Microsoft, and Vigor Industries located in Washington.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | MILITARY, DEFENSE, AND NATIONAL SECURITY 54
Appendix
SWOT Sector Cut Sheets | Military, Defense, and National Security
CHALLENGES OPPORTUNITIES
■ Changes to the global supply chain ■ Cybersecurity to set the pace for cyber resiliency and
independence along the state’s defense and ICT supply chain
■ Adapting to environmentally friendly practices
■ Further develop relationship between Washington’s Military,
■ Significant shifts in the global geopolitical dynamic
Defense, and National Security sector and commercial sectors to
■ Climate change as a national security issue drive innovation
■ Long-term effect of the pandemic and the impact on the nature ■ Leverage Washington’s strong ICT industry to attract the
or size of the defense effort Department of Defenses’ growing investment in artificial
intelligence, machine learning, advanced networking, cyber, and
Joint All-Domain Command and Control
■ Establish a system for credential reciprocity to help military
dependants and spouses more easily enter the qualified
workforce
■ Increased investment in transition services for military members
transitioning out of the military
Cybersecurity Hub: Maryland.
More than 40 government agencies call Maryland home, providing the state with
a natural advantage in leading the cybersecurity movement within the military,
defense, and national security sector. Agencies include the National Security Agency,
National Institute of Standards and Technology, Defense Information Systems Agency,
Department of Defense Cyber Crime Center, and NASA. Maryland also boasts more than
150,000 cyber-related engineering and data science professionals, comprising the #1
cyber workforce in the world. Additionally, Maryland is the first state to have set up a
cyber investing arm directly funded by the state government.
Source: https://cybersecurityventures.com/the-cyber-hub-war-is-on-maryland-aims-to-become-global-headquarters/
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | MILITARY, DEFENSE, AND NATIONAL SECURITY 55
Appendix
SWOT Sector Cut Sheets | Trade and Logistics
IMPORTS AND EXPORTS THROUGH WASHINGTON PORTS
$250
$199.9 $197.9 $200.1 $199.9
$200 $188.0 $194.2 $189.9 $190.4
$183.7 $184.5
$173.7 $169.3 $172.4
$149.7
$150 $105.3 $98.9 $98.4 $98.2
$98.3 $136.8
$104.6 $99.5 $98.3 $101.9
$104.0
$101.8 $93.6 $96.3
$80.4
$100 $80.6
$50 $94.6 $98.9 $101.7 $101.7
$88.5 $95.9 $91.5
$79.7 $79.9 $75.7 $88.5 $76.1
$71.9 $69.3
$56.2
$0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
IMPORTS EXPORTS
Source: U.S. Census Bureau, 2020-2021; Federal Reserve Bank of St. Louis, 2020; Community Attributes Inc., 2021.
STRENGTHS
Washington’s economy relies on the state being a trade hub, utilizing rail lines, roads,
■ Proximity to western trading partners
and waterways to connect the state’s expansive network of ports to transport goods in
and out of the state. Supporting this strong trade sector are logistics firms responsible ■ Established trade hub (in top five for exports by value in 2019 in
for ensuring imports and exports travel efficiently. A report by The Trade Partnership the U.S.)
estimated that 921,400 jobs were supported by trade (exports and imports) in Washington ■ Large talent pool and strong educational partnerships
in 2017, approximately 28% of total statewide employment.
■ Well-established shipping infrastructure
■ Diversity in products imported and exported
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | TRADE AND LOGISTICS 56
Appendix
SWOT Sector Cut Sheets | Trade and Logistics
CHALLENGES OPPORTUNITIES
■ Continued national tensions with China ■ Growth in e-commerce
■ Pandemic impacts to the global supply chain ■ Relocation of western manufacturing
■ Competition from British Columbia ports Prince Rupert and ■ Foreign Direct Investment
Vancouver, as well as LA-Long Beach and the newly widened ■ Emerging technologies that reduce carbon and reduce the
Panama Canal amount of time to get goods to consumers
■ Coordination among international organizations ■ Trucking and rail automation and advanced air mobility
■ Public support for trade
■ Changes to customer expectations (faster, more flexible, lower
price shipments)
■ Keeping pace with infrastructure updates needed to support
the industry
El Paso’s new role in trade and logistics as manufacturing
undergoes nearshoring.
El Paso, Texas, has seen a large influx of logistics companies and investment in the logistics
sector since 2014. As reshoring and nearshoring has gained speed in recent years,
especially hastened by the COVID-19 pandemic, El Paso has continued to evolve into a
trade and logistics hub along the United State’s southern border. With the equalization
of manufacturing wages in China and Mexico strengthening Mexico’s manufacturing
presence, El Paso has played an increasingly important role in the global supply chain.
Among the logistics companies with operations in the city, DHL has been among the
leaders shaping El Paso’s up and coming trade and logistics sector. Other factors driving
the city’s evolution include El Paso’s workforce trends, transportation infrastructure, pro-
business political leadership, vibrant downtown, and incentive packages helping attract
private investment.
Source: https://www.supplychaindive.com/news/el-paso-texas-DHL-border-logistics-trade/588614/
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | TRADE AND LOGISTICS 57
Appendix
SWOT Sector Cut Sheets | Manufacturing
MANUFACTURING EMPLOYMENT AND OUTPUT, WASHINGTON STATE
350,000 16.0%
14.4%
300,400 298,600 305,300
300,000 294,600 14.0%
283,800
301,200
12.5% 12.0%
250,000
11.8% 11.5%
11.3%
10.0%
200,000 10.0%
8.0%
150,000
6.0%
100,000
4.0%
50,000 2.0%
0 0.0%
2015 2016 2017 2018 2019 2020
MANUFACTURING EMPLOYMENT MANUFACTURING OUTPUT AS PERCENTAGE OF STATE GDP
Source: U.S. Census Bureau, 2020-2021; Federal Reserve Bank of St. Louis, 2020; Community Attributes Inc., 2021.
As of 2019, manufacturing employment was responsible for nearly 300,000 Washington STRENGTHS
jobs. While aerospace manufacturing makes up the largest proportion of Washington’s
manufacturing by value of goods produced, the sector is rather diverse and includes ■ Low state energy costs
many subsectors, including petroleum products, computer and electronic products, ■ Major employer statewide and source of high paying jobs
chemical manufacturing, and medical manufacturing. Geographic concentration
■ Connection with key regional sectors
depends on the subset of manufacturing; generally manufacturing employment is well
distributed throughout the state. Medical manufacturing and aerospace manufacturing ■ Extensive port system and history as a trade leader
are concentrated in the Puget Sound Region while agricultural manufacturing is more
prominent in central and eastern Washington.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | MANUFACTURING 58
Appendix
SWOT Sector Cut Sheets | Manufacturing
CHALLENGES OPPORTUNITIES
■ Maintaining infrastructure ■ Commercial space, agritech, and biotech manufacturing
■ Skilled labor shortage ■ Workforce development, re-branding of entry level
manufacturing jobs, and engaging with broader talent ecosystem
■ Lacking presence of high-tech manufacturing
■ Continue leading research and innovation in energy intensive
■ Increased cyberattacks adding business risk for manufacturers
manufacturing for regional industries: food processing, advanced
■ Pandemic impacts: supply chains and decreasing margins materials, and forest products
■ Advances in technology (Industry 4.0)
■ De-carbonizing and revitalizing industrial manufacturing
■ Potential cross-industrial and -institutional partnerships to
achieve shared goals of innovation, resiliency, and efficiency
Biotech manufacturing gains in Minnesota
Headquartered at the University of Minnesota in St. Paul, the BioIndustrial Manufacturing
and Design Ecosystem (BioMADE) received an $87 million, seven-year grant from the
Department of Defense. BioMADE will use the grant to advance sustainable bioindustrial
manufacturing technologies in collaboration with public and private entities. The
Department of Defense cited their commitment to promoting the United States biotech
innovation when interviewed about the grant. Anticipated manufacturing applications
to come as a result of the grant include chemicals, solvents, detergents, reagents, plastics,
electronic films, fabrics, polymers, agricultural products, crop protection solutions, food
additives, fragrances, and flavors.
Source: https://www.defense.gov/News/Releases/Release/Article/2388087/dod-approves-87-million-for-newest-bioindustrial-
manufacturing-innovation-insti/
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | MANUFACTURING 59
Appendix
SWOT Sector Cut Sheets | Construction
CONSTRUCTION JOBS, WASHINGTON STATE
250
200 206 200
200 187
175
163
150
150 140
130 127 130
100
50
0
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Source: Bureau of Labor Statistics, 2021; Community Attributes, 2021.
STRENGTHS
Washington’s construction sector employs an estimated 223,000 workers. Nearly ■ Robust industry growth and demand for new construction
two-thirds of these workers are classified as specialty trade contractors. The sector
■ Abundance of local natural resources
proved rather resilient during the pandemic, with employment levels returning
to 95% of pre-pandemic capacity by July 2020, and employment returning fully ■ State investments in wood energy and materials innovation
to pre-pandemic capacity by March 2021. However, the industry remains in flux ■ Investments in innovative construction methods
as a result of pandemic-related labor shortages, automation, supply chain issues,
■ Active Labor associations implementing workforce programs
remote work, and rising costs, as well as non-pandemic-related issues like federal
and state policy, and work stoppages due to contracting and bargaining disputes. ■ Seattle’s growth anchoring statewide return to pre-pandemic
The industry will need to remain agile and adapt to changing economic conditions
operations
and innovations.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | CONSTRUCTION 60
Appendix
SWOT Sector Cut Sheets | Construction
CHALLENGES OPPORTUNITIES
■ Rising land and raw materials costs ■ The American Jobs Plan and the Infrastructure Investment and
Jobs Act
■ Policy and regulatory issues related to land availability, density,
and intensity of development ■ Sustainability movement
■ Uncertain demand for commercial real estate due to increases in ■ Mass timber and cross laminated timber
remote work ■ High demand for new construction with up-zoning
■ Shifts in labor demands and automation
■ Federal policy around immigration and assistance impacting the
labor pool
■ Pandemic impacts on labor, supply chains, and productivity
■ Aging construction workforce
Mass timber in British Columbia, Canada.
Canada has been the western hemisphere’s most eager adopter of mass timber
technologies for use in construction. In April of 2021, British Columbia announced eight
new mass timber construction projects to be undertaken as a part of a mass timber
demonstration aimed to grow the regions expertise in mass timber construction. The
program also works to support jobs and employment recovery in the construction
industry. Previous success with mass timber construction in the region provides
evidence for the benefits of the relatively new building materials, most prominently seen
in Vancouver’s Brock Commons. One notable achievement of Brock Commons’ was the
length of construction. The project was completed in 70 days following the delivery of
the prefabricated mass timber components, which is approximately four months faster
than a typical project of the same size.
Source: https://www.naturallywood.com/blog/mtdp/
https://www.thinkwood.com/projects/brock-commons-tallwood-house
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | CONSTRUCTION 61
Appendix
SWOT Sector Cut Sheets | Hospitality and Tourism
STATE PARK VISITATION, WASHINGTON STATE
45,000,000
40,000,000 38.5M 37.5M
37.5M
35.9M 36.3M
35,000,000 32.8M
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
0
2015 2016 2017 2018 2019 2020
Source: Washington State Parks, 2021; Community Attributes, 2021
Historically, hospitality and tourism has been on of Washington’s largest sectors and STRENGTHS
has employed more than 180,000 workers statewide. Washington has something to
offer for every potential visitor, with attractions spreading into every corner of the state. ■ Strong tourism assets
Attractions include a plethora of beautiful scenery and outdoor experiences, in addition ■ Established sector presence
to bustling urban centers promoting arts, culture, and sports.
■ Current funding and marketing opportunities
■ Sea-Tac International Airport as a major hub for Delta and
Alaska Airlines
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | HOSPITALITY AND TOURISM 62
Appendix
SWOT Sector Cut Sheets | Hospitality and Tourism
CHALLENGES OPPORTUNITIES
■ Workforce shortage ■ Increased tourism marketing and targeted marketing around
urban, rural, and natural assets
■ Low to moderate wages and high job volatility
■ Surging demand in the cruise industry
■ Pandemic disruptions to travel and lifestyles, such as decreasing
household income spending on food and entertainment away ■ Capitalizing on pandemic induced trends sending visitors to rural
from home and remote destinations
■ Climate change, wildfires, rising sea levels ■ Increased demand for ancillary, allied spending among
spectators either before and/or after events, such as at local
■ Historical lack of investment in tourism marketing
restaurants and bars
Tourism marketing success in Michigan.
Michigan’s current tourism marketing campaign Pure Michigan commenced in 2008.
Funding for the state’s tourism office jumped significantly from 2008 to 2009, with a
proportion of the new funds being dedicated to the campaign. The campaign aimed to
attract visitors to the Great Lakes state and thus far has accomplished its goal of raising
Michigan’s profile with tourists. While estimates of the campaign’s total economic impacts
vary, Longwoods International conducted a study that assigned $1.2 billion in economic
impacts generated by more than four million trips in 2012. Meanwhile, Travel Michigan,
the state’s tourism office, estimates that the Pure Michigan campaign generated $153
million in state tax revenue in 2018.
Source: https://www.ncsl.org/research/fiscal-policy/state-tourism-office-budgets.aspx;
https://www.networksnorthwest.org/news-events/news/pure-michigan-campaign-drives-12-billion-in-visitor-spending.html.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | HOSPITALITY AND TOURISM 63
Appendix
SWOT Sector Cut Sheets | Financial Services
FINANCE AND INSURANCE JOBS, WASHINGTON STATE
100 93 94 94 95 95
90 91 92
88 87 88
90
80
70
THOUSANDS OF JOBS
60
50
40
30
20
10
0
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Source: Bureau of Labor Statistics, 2021; Community Attributes, 2021.
STRENGTHS
Washington’s financial services sector includes the subsectors of accounting, banking,
credit and lending, financial investing, insurance, and public finance. Defined as NAICS ■ Diverse workforce
52—Finance and Insurance, the financial services sector employs more than 100,000 ■ Large network of commercial banks
Washington workers throughout the state. About half of all financial services workers
■ Growing startup community
were employed within the Seattle Metropolitan Statistical Area (MSA). Compared to
other Seattle or regional industry clusters, financial services is fairly nascent; however, its ■ Local tech talent pool
intersection with existing clusters—including ICT, tech, and innovation—positions it as a ■ Emerging dependency on ICT sector
potential high-growth and opportunity sector.
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SWOT Sector Cut Sheets | Financial Services
CHALLENGES OPPORTUNITIES
■ No major banks are headquartered in Washington ■ Seattle and the state are potentially strong fintech hubs due
to existing industry and innovative sectors and educational
■ Increasing cybercrime attacks inflicted on financial institution
institutions
■ Legislative and regulatory landscape
■ Traditional financial services companies growing investment
■ Increasing barriers for small and medium size firms in modern data and analytics tools, artificial intelligence
capabilities, and digital platforms
■ Established group of incubators, investors, and institutions in
tech or tech-enabled businesses can facilitate a new focus on
fintech startups and innovation
Fintech in New York.
New York is one of many up-and-coming fintech hubs. New York’s fintech industry
includes companies specializing in digital wealth, crytpo, lending, insurance, and B2B
fintech. Leading fintech companies include Lemonade and Oscar (insurance), Betterment
(robo-advising), Forter (fraud protection), Petal (credit), and Stash (micro-investing). New
York also contains incubator and accelerator companies such as TechStars, Citi Innovation
Labs, and Fintech Innovation Lab. To date, Fintech Innovation Labs has helped startups
raise $1.8 billion in capital investments.
Source: https://thefintechtimes.com/guide-to-north-american-fintech-hotspots-covering-atlanta-boston-chicago-los-angeles-new-
york-and-san-francisco/
https://www.fintechinnovationlab.com/regions/new-york/
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SWOT Sector Cut Sheets | References
1. “Space Florida: One Place. Infinite Possibilities,” Space Florida, n.d. 12. “As supply chains cut costs, El Paso, Texas, takes on a new role,” Supply Chain Dive,
November 2020.
2. “Automation Helps Solve Specialty Crop Challenges,” Department of Agriculture, July
2021. 13. “DOD Approves $87 Million for Newest Bioindustrial Manufacturing Innovation
Institute,” Department of Defense, October 2020.
3. “Clean Jobs Washington,” Environmental Entrepreneurs, November 2020.
14. “8 mass timber demonstration projects announced,” Naturally Wood Timber Trends,
4. “Mapping the timber industry boom in 2021,” The Architect’s Newspaper, April 2021.
April 2021.
5. “Cyberstates 2021: The definitive guide to the U.S. tech industry and tech workforce,”
15. “Brock Commons Tallwood House,” Think Wood, n.d.
CompTIA, March 2021.
16. “Visitation Reports,” Washington State Parks, n.d.
6. “Talent Show: Louisville’s push for a more tech-focused workforce takes center stage,”
Louisville Business Journal, April 2021. 17. “SEA Airport Statistics,” Port of Seattle, n.d.
7. “Massachusetts’ Digital Health Initiative,” Mass Digital Health, n.d. 18. “State Tourism Office Budgets,” National Conference of State Legislatures, August
2019.
8. “Massachusetts: A Leading Global Digital Health Ecosystem,” Mass Tech, n.d.
19. “Pure Michigan Campaign Drives $1.2 Billion in Visitor Spending,” Networks
9. “Anchors Aweigh: Examining Biofuels for Maritime Shipping,” Department of Energy,
Northwest, 2013.
June 2021.
20. “Guide to North American Fintech Hotspots; Covering Atlanta, Boston, Chicago, Los
10. “Black light biotech,” Oak Ridge National Laboratory, n.d.
Angeles, New York and San Francisco,” The FinTech Times, December 2020.
11. “The Cyber-Hub War Is On: Maryland Aims To Become Global Headquarters,” Cyber
21. “Regions,” FinTech Innovation Lab, n.d.
Security Ventures, January 2019.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | SWOT INDUSTRY CUT SHEETS | REFERENCES 66
APPENDIX B
ENGAGEMENT – DETAILED NOTES
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
Appendix
Washington State Legislative Committee on Economic Development & International Relations (WA LCEDIR)
Below are the dates, participant lists, and notes from each of the focus group meetings.
Focus Group Participant Lists & Notes OCTOBER 8
COMMISSION ON ASIAN PACIFIC AMERICAN AFFAIRS FOCUS GROUP NOTES
During the months of October-December 2021, Triangle conducted focus groups
with the following: Participants:
1. Commission on Asian Pacific American Affairs • Toshiko Hasegawa, CAPAA
2. Washington State Women’s Commission • Brenda O’Brien, CAPAA
3. Washington State Women’s Commission Stakeholders • Chongsun Abbott, CAPAA
4. Quinault Prosperity, Health, and Human Services Subcommittee • Chairman Diaz, CAPAA
• Lalita Uppala, CAPAA
5. Washington State Labor Council Manufacturing Labor Roundtable
• Sam Cho, CAPAA
6. Department of Commerce Small Business Resiliency Network
7. Latino Education and Training Institute Notes:
8. Seattle Metropolitan Chamber of Commerce REACH There is a need for idiomatic and culturally specific support and structural support.
9. Washington State Labor Council Worker Group ■ Small business owners face bureaucratic and administrative challenges and need
• support with paperwork, bookkeeping and tax duties, hiring and employment, and
digital access.
■ Specialized support for businesses to ask questions and seek support.
■ Provide structural support for businesses to access information, resources, and set
up lasting systems.
■ Create a trusted space and resiliency network and utilize the trusted messenger model.
Invest in OWMBE businesses and the organizations that support them.
■ Contract with OWMBE businesses for state and government work and invest in small
businesses through contracts.
• Provide incentives for procurement managers.
■ Empower, educate, and train CBOs or legal clinics on how to support small businesses
and provide the resources they need.
■ Support immigration and refugee documentation for employers and employees.
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Talk with communities and small businesses to understand the barriers and issues Protect employee rights and consider what is best for workers.
they face.
■ Protect the right to organize, the right to unionize.
■ Conduct community and business interviews to understand the minority-owned
■ Amplify labor groups and employee leadership.
business environment and why small businesses face the barriers they do.
■ Give employees a voice in the workplace.
■ Provide training on how to start a business.
■ Provide jobs that allow people to support their families.
■ Provide cultural and geographic accessibility.
■ Provide benefits and overtime pay for all workers, including in the agricultural sector.
■ Protect employees in customer service roles, especially after COVID.
■ Reduce the barriers to receive credit and loans for undocumented workers.
OCTOBER 22
■ Think about showing up in the workplace more holistically to consider lives outside
WASHINGTON STATE WOMEN’S COMMISSION FOCUS GROUP NOTES
of work.
Participants:
Provide support for small businesses and invest in infrastructure solutions.
• Jaxon Riley, Executive Director of Leadership Spokane
■ Fund government programs and departments that support small businesses, such
• Maami Hudson, Small Business Support Navigator for the Tacoma Urban League
as the Department of Commerce.
• Ginger Ewing, Terrain Spokane
■ Recognize and support the role of organizations that support language and cultural
• Amal Joury, Director of Operations at Derma Medical Spa
access needs for small businesses.
• Terran Echegoyen, Inland Northwest Business Alliance
■ Support equitable solutions that are already underway.
Notes:
Improve access to resources and information.
Understand the barriers and challenges that employees face. ■ Information and paperwork required for grants and assistance can be hard
■ There is a shortage of professional jobs and jobs that provide living wages. to produce.
■ Businesses experience digital barriers.
• Provide incentives for skills training at community colleges (medical and dental
assistants, nurses). ■ Smaller business and BIPOC organizations have limited access to capital, financial
loans, and PPP aid.
• Offer mentorship and training.
■ Improve the accessibility and overall knowledge of assistance programs.
■ There is a lack of available and affordable workforce housing.
There are needed infrastructure improvements, including:
■ Understand the causes of current and past workforce migration.
■ License transfers between states and for immigrant workers create a barrier. ■ Affordable and accessible childcare.
■ Affordable workforce housing.
■ Training for businesses and microenterprises.
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OCTOBER 29 ■ Provide living wages.
WASHINGTON STATE WOMEN’S COMMISSION FOCUS GROUP NOTES
Invest in employee well-being:
Participants:
■ Support flexibility for employees (i.e., being able to work at 80-90% rather than 100%
• 6th Councilwoman Clarinda Underwood, Subcommittee Member
all the time to accommodate personal schedules, childcare, eldercare, etc.).
• 3rd Councilman John Bryson, Subcommittee Member
■ Create room for employees to work at different capacity levels to balance out
• Treasurer Larry Ralston, Subcommittee Member
workload surges. Provide mental health support for small businesses and employees
Notes: by investing in long-term mental health support and a follow up system.
Re-think structural systems and investments: ■ Create safe and comfortable workspaces where employees can bring their full selves
to work:
■ Shift state investment priorities to focus on supporting small businesses and the
organizations that support them to reduce burdens on impacted communities. • Normalize pronoun usage.
■ Adjust state investment priorities to adjust for communities throughout the state; • Policies that require education around workplace conduct and how to
they may be different from one geography to the next. treat others.
■ Create equitable opportunities for small businesses and non-profits. Barriers:
■ Consider distributed leadership models to empower employees and encourage ■ Cost of healthcare.
democratic decision making.
■ Licensing barriers.
■ Provide universal healthcare (including mental health) to reduce burdens on small
■ Stigma around hiring formerly incarcerated employees.
businesses and support employees transitioning between jobs.
■ Stability issues (i.e., houseless, sobriety requirements for housing, access to addiction
■ Provide living wages.
services, mental health case management/ensure follow through).
Provide administrative and professional development support:
■ Housing affordability and availability.
■ Provide culturally specific and in-language resources for small businesses. ■ Business rental space affordability and availability.
■ Lower the barrier to entry for small businesses and entrepreneurs with sector specific ■ Infrastructure issues (i.e., access to broadband, etc.).
business professional development support.
■ Lack of diversity within companies and Black, Indigenous, and People of Color not
■ Promote and provide vocational work and education/training, starting at a feeling welcome or culturally accepted.
young age.
■ Access to resources for entrepreneurs.
■ Provide equity training to boards with investing or funding power.
■ Subsidized childcare.
■ Build trust with communities.
■ Two-way trust with communities being served (i.e., must trust the communities that
■ Provide universal healthcare (including mental health) to reduce burdens on small are being served to receive trust).
businesses and support employees transitioning between jobs.
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NOVEMBER 9 ■ There are significant investments in education that have been, which is viewed as a
QUINAULT PROSPERITY, HEALTH, AND HUMAN SERVICES SUBCOMMITTEE FOCUS partnership with the State.
GROUP NOTES
Changes to the mill and fishing industries have significant impacts on the Quinault.
Participants: ■ There is a need for support and strategies for displaced workers.
• Regina Malveaux, Director • Competitive salaries.
• Michelle Merriweather, Chair
• Provide state unemployment funds for recently displaced workers.
• Rituja Indapure, Vice-Chair
• Provide workforce transition training for skill development.
• Quinn Dalan, Secretary
• Provide options and support for entrepreneurship or artistry.
• Anna Franklin
• Grace Huang ■ It is difficult to encourage change in workers with life-long careers without financial
incentives or free training.
• Chris Kobdish
• Vicki Lowe There is a lack of trade workers or employees with trade expertise.
• Kasi Perreira ■ Provide physical and online training opportunities for vocational and trade work.
• Dawn Rains
■ Nursing and clinic positions are underfilled.
Notes: • Paid for online and in-person vocational training for young adults and adults (i.e.,
Infrastructure is a priority. carpentry, electrical, plumbing), as well as in other industries such as nursing,
forestry, light manufacturing, IT, trans-oceanic communication cable, etc.
■ The lack of housing infrastructure and affordable housing on the reservation impact
■ Once paid for training is provided, incentives for folks to stay on the reservation
job retention.
are needed.
■ Commuting onto the reservation for jobs is too cumbersome for most.
■ Invest in additional education programs, such as Computer Science, at the
■ There is a lack of infrastructure and an outdated and overburdened energy grid (i.e., local college.
power, water, sewer, internet).
■ Experienced trade workers move away to work on larger projects and are not
■ Interest in building energy infrastructure and addressing climate change. available as a resource for the tribe.
■ Broadband accessibility is an important part of the infrastructure, and the Quinault Consider the unique challenges the Quinault and other tribes face.
built out (and paid for) their own network.
■ The Quinault have different needs and issues compared to tribes located on or near
• More reliable and faster internet access with more bandwidth internet access is the I-5 corridor.
needed, and to provide this on the reservation the Tribes need grants, not loans.
• Employees have longer commutes.
• Communicate clearly with the Tribes on broadband opportunities and networks.
• Access is limited.
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■ Challenges related to COVID-19 continue to cause economic hardship (ex. Sweetgrass Workforce barriers include lack of training, access to living-wage, high-quality jobs,
Motel still non-operational even after financial incentives added to hiring). and employee benefits.
Improve access to resources and information. ■ Disconnect between employers and employees:
■ Information and paperwork required for grants and assistance can be hard • Employers are looking for ways to address supply chain issues by cutting corners
to produce. with training and hiring younger workers.
■ Businesses experience digital barriers • Access to healthcare and delays around retirement security hinder people from
taking on jobs, especially the younger workforce.
• Shortage of employers that are willing to provide living wages and
high-quality jobs.
DECEMBER 13
■ Employees need state registered apprenticeship programs with the
WASHINGTON STATE LABOR COUNCIL MANUFACTURING LABOR ROUNDTABLE
following considerations:
Affordable housing and cost of living have broad impacts on the workforce.
• Pre-apprenticeship as a proven best practice to support equity models
■ Workers are moving to areas with more affordable housing (North Puget Sound to
• Accountability within training programs to recruit and retain workers
South Puget Sound). On top of manufacturing jobs being in-person, this migration
can create longer commutes, which can impact job performance • Requirements and outcomes for results the industry can count on, including the
number of jobs in the region, set wages, and job standards.
■ Many workers have required response times and must be within a certain distance
or time from their jobs There can be misrepresentation around the industry that masks workforce issues.
■ Housing prices have significant impacts on lots of jobs, especially at the lower end ■ The term “skill gap” can oversimplify other barriers the workforce faces, including age
of the manufacturing scale and workers may have to work more than one job to discrimination, lack of understanding around transferable skills, and other issues.
afford housing.
■ Energy intensive and trade exposed industries can face bad press.
■ Workers experience sticker shock if they are transferred within their industry to a
new location Provide technical, permitting, and regulation support.
■ Suggestions included: ■ Streamline siting and permitting process, including labor standards.
• Investing in housing for workforce and providing infrastructure (Kaiser was ■ Provide technical support for registered apprenticeships.
an example) ■ Enforce regulations to address supply chain issues, foreign competition, and leakage
• Investing in worker welfare to other states.
• Investing in childcare options, particularly for non-standard hours ■ Address issues around misclassification and access to state social safety nets so
employees know what resources they have access to.
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Washington State Legislative Committee on Economic Development & International Relations (WA LCEDIR)
DECEMBER 14 ■ Airbnbs and vacation houses impact available housing.
DEPARTMENT OF COMMERCE SMALL BUSINESS RESILIENCY NETWORK
• Olympic Peninsula and Jefferson County housing.
GROUP 1 • Forces more workers to commute.
Affordable housing is a significant issue. ■ Suggestions included:
■ There is a housing shortage, a lack of affordable housing, and a large houseless • Zoning code adjustments for more affordable housing, including eliminating
population. Suggestions to address this included: exclusionary zoning and height restrictions to maximize the number of new units
that can be built on available suitable parcels near amenities. Incremental tweaks
■ Community living that allows more than one family to live on one parcel. A
in this regard have show a lack of response in the market already, contributing to
statewide law currently limits county ability to have community living without
the statewide housing deficit.
individual ownership or build ADUs.
■ Zoning code adjustments for more affordable housing. Small businesses lack access to resources, language and technical support, and
safe workspaces.
■ Direct solutions for houseless populations by addressing housing shortages,
affordability, and accessibility. ■ Small business and the workforce encounter language barriers, technological
barriers (Zoom and social media), and access to workforce training.
■ Promote equity in new development (example: new apartment buildings
should have a percentage of units dedicated to low-income housing.) • Lack of childcare.
■ Financial, technological, and cultural literacy impact access to housing. ■ Workforce training and navigating COVID protocols falls on local communities.
• There are language barriers. ■ Suggestions included:
• Technological literacy (social media, Zoom, use of the internet) impacts housing • Conversations with the Chamber of Commerce
access for those who rely on newspapers or mail. • Support for administrative and paperwork requirements, especially for taxes and
• Financial literacy and access to funding support, especially for immigrant, finances. Ex: help people understand how to select banks, financial support, and
refugee and BIPOC-owned businesses. These businesses do not qualify for things to look out for.
commercial rent assistance opportunities because most of them have borrowed • Focus on small businesses. Most state support is directed towards institutions.
from community brokers, family, and friends and owe debt outside of rent.
Access to capital and lending is a significant barrier.
• Marketing for housing is not reaching cultural communities, and the application
process is burdensome and difficult to navigate. ■ Lending, interest rates, and access to capital are barriers.
■ Available housing and lack of transportation make it difficult for workers to commute. ■ There is a stigma around taking on debt.
• Ex: Little Saigon and International District housing is too expensive, and ■ The environment around traditional lending does not support small businesses.
employees live further away, which makes it difficult to access.
■ Applications are complicated and time consuming.
• Lack of transportation exacerbates this issue.
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■ Suggestions included: costs to make some units in these projects affordable unites, contributing to
highly desirable mixed-income housing stock.
• Patience capital to ensure programs and assistance are available.
• Remove or at least increase caps to numbers of residents allowed to cohabitate
• One-on-one business coaching. It is more time-intensive but necessary.
in a common dwelling to recognize the increasing necessity and popularity of
• Provide information about what is available and support for applications. co-living arrangements.
• Implement Community Development Financial Institutions to provide lending in • Make sure additional tenant protections take into account “tenant in common”
a non-traditional way. living situations.
• Help small businesses find good matches for loans with fair interest rates and Small businesses don’t have the same resources as larger competitors.
reasonable timeframes for repayment by creating a partnership between lenders
and small businesses. ■ Costs associated with fringe benefits are high for small businesses and they can’t
always offer those benefits to employees.
GROUP 2
■ Bigger businesses have more capacity to provide in-house training, putter smaller
Affordable housing is a big barrier with financial and cultural impacts. and independently owned businesses at a workforce disadvantage.
■ Cost of healthcare, insurance, and benefits impact small businesses.
■ There are housing inequities across the state and housing prices have exploded.
Wages don’t match the growth of housing prices, especially in the working class. ■ Bigger businesses, such as Amazon, monopolize advertising space and workforce
recruitment, especially for mobile employees.
• Ex: Spokane has the 3rd largest anticipated housing price hike in the country for
2022. ■ Suggestions included:
■ Individuals can’t invest or accrue generation wealth. • Small business support for health insurance and trainings through policy
initiatives.
■ Movement and migration impacts: Workforces are moving outside of urban centers
for more affordable housing, or leaving the state entirely. • Offer portable benefits to workers in the labor pool rather than through individual
employers.
■ Owning a house is an indicator of success, especially in Asian communities.
• Families or small businesses are selling homes or properties to support their Small businesses and employees don’t have the resources they need.
businesses, which impact what is considered success for them.
■ There are barriers to access across all sectors, including lack of program coordination
■ Suggestions included: and lack of access to specialized technical assistance.
• Providing housing and residential assistance (Ex. El Centro). ■ There is a large time investment for trainings.
• Alternative models to housing, including alternative cooperative ownership. ■ Access to technology and financial support is a barrier.
• State run program that helps people participate in co-buying contracts. ■ Norms around interviews, professionalism and workplace training can be barriers
for employees.
• Modify Washington State Housing Trust Fund grant programs to allow community-
driven co-housing projects to be eligible for funds to help offset development
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■ Documentation and paperwork required for training is a barrier. DECEMBER 15
LATINO EDUCATION AND TRAINING INSTITUTE
■ Suggestions included:
• Access to the internet and bringing technology to underrepresented communities. Economic success means stability, balance, and equality.
• Establish collaborative and inclusive ecosystems across funding and programs. ■ Stability includes housing that is affordable and available. The rapid increase for
cost-of-living impacts workers.
• Provide workshops for individuals without access interview knowledge or
networks to help with interviewing and hiring processes. ■ Success is a community that is financially stable and self-sufficient.
Lack of capital and access to grants is a barrier. ■ Provide economic balance: having a good, living wage job and the ability to afford
or achieve your goals.
■ Small businesses often face too many barriers to overcome – there are barriers at
■ Equal competitive conditions.
every step of the process.
■ Competitive equality: Employers know the laws and government provides equal
■ Systemic and administrative barriers, including language barriers, prevent small
service for everyone and equally distributed benefits.
businesses from getting the help they need.
• Ex: The pandemic affects people who don’t have the information or the resources
• Ex: There is not enough help along the way and businesses have issues accessing
that can help them.
their money or grants.
■ There is a lack of access to grants and financial support. It is difficult for employees/employers to get the resources and support they need.
■ Supply chain issues, shipping delays, and increase in the cost of goods impact ■ Banks are being extremely cautious with lending and it is difficult to find investors.
small businesses ■ There is a lack of resources in Spanish, and those that exist are hard to find.
■ COVID mandates, vaccine verification and lack of clarity around COVID polices are ■ There is uncertainty around the support and resources available for small businesses.
difficult to navigate and businesses choose to stay closed.
■ Employees may have skills and experience, but it is difficult to secure work without
■ Suggestions included: a degree.
• Clear policy communications and guidelines, especially around COVID ■ Employees are balancing work, school, and family and still trying to save up for
• Support for small businesses (especially restaurants) to understand COVID homes or provide for their families.
mandates and regulations. • Sacrifice savings, time with children, etc.
• Support for small businesses in the face of supply chain shortages. ■ During COVID, people are not investing professional growth.
■ Suggestions included:
• Creating businesses and a business environment with resources to navigate
accessing capital or loans with low interest rates.
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• Improve access to banking and loans and general understand of policies, laws, • Provide instruction or assistance to business owners to legally validate their
and resources. businesses.
• Improve access to resources and support. • Provide information on how to obtain small business loans.
• Provide government support for programs that offer education and training for • Chamber of Commerce and small businesses should partner to analyze products
higher-wage jobs. to import and export and offer business fairs in different sectors.
• Educate communities on available resources and how to take advantage • Provide training as soon as possible.
of them.
• Reduce the cost of education.
• Provide economic resource and financial literacy training. Ex: Ho to save for
college and retirement and savings programs for elders.
• Offer more meetings or trainings related to economic development, especially
for youth. DECEMBER 15
QUINAULT PROSPERITY, HEALTH, AND HUMAN SERVICES SUBCOMMITTEE
• Offer job training in primary languages.
MEETING #2
• Offer more virtual classes and trainings.
Participants:
• Provide bilingual instructional courses for employees (computer skills, marketing,
basic office programs, email, etc.) at low or no cost. • Aiyana Underwood, Quinault Indian National Policy Coordinator
It is difficult to utilize transferable skills or transition to a new career. • Christine Winn, QNIB CEO
■ Many Latinos who have come to the U.S. don’t use the skills or the accreditations • 6th Councilwoman Clarinda Underwood, Subcommittee Member
they’ve acquired in their own country. • Guy Capoeman, President of Quinault Indian Nation
■ For employees or businesses that struggled during the pandemic, transitioning jobs • 3rd Councilman John Bryson, Subcommittee Member
or utilizing transferable skills was difficult.
• Treasurer Larry Ralston, Subcommittee Member
■ Smaller communities don’t receive the same information around economic
• Marie Sullivan, State Lobbyist for Quinault Indian Nation
opportunities and resources.
• Scott Richards, State Lobbyist for Quinault Indian Nation
■ The cost of education and obtaining college credits is a big barrier.
• Kryn Sausedo, EcoNorthwest
■ Suggestions included:
• Jade Aguilar, EcoNorthwest
• Easier process to validate titles or experience.
• Annie Kilburg Smith, Triangle Associates
• Provide programs for non-traditional students (first generation Latinos, etc.) to
validate and acquire titles to increase their income. • Claire Wendle, Triangle Associates
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There is a lack of affordable and available housing. • Strategies to continue services: Shortened hours, streamlined and reduced
services and closed departments.
■ Housing prices are unattainable for $15/hour wages.
• There is less interest in QNIB jobs because of non-standard hours (9-5).
• Grays Harbor County is experiencing extremely high real estate prices.
■ Trade jobs are struggling:
■ There is a lack of new housing due to the recession from the 1980’s that stunted
housing construction. • There is a lack of homebuilders and workers are outsourced for home construction.
• There are no available or affordable rentals. • It is difficult to obtain county permits.
• People are coming from other places to live in the County. • The fishing industry lacks funds even though there is potential for economic
development or growth.
• New-build houses are not affordable.
• Grays Harbor Community College lacks the curriculum for trade jobs.
■ Available real estate impacts businesses, and there is a tax incentive (Opportunities
Zone) to invest in the County, but investors buy properties to hold and sell for later, • Natural resource collapse is forcing people to seek other work or slowing down
which pushed out businesses and results in empty buildings. some industries.
■ Suggestions included: • Climate change and ocean acidification are affecting the crab and shellfish
harvests.
• Workforce housing on the reservation.
■ Suggestions included:
• Housing for the wellness clinic.
• Infrastructure to help people transition.
• More affordable housing.
• Use timber resources to boost housing industry.
Industry changes and COVID have caused workforce shifts and impacted
recruitment. • Offer technical training.
• Invest in timber and fish industries.
■ The older workforce isn’t returning to work (ex. casino workers or workers at the
Sweetgrass in Ocean Shores) and there is growth in union membership. • Provide alternatives and post-secondary education apprenticeships and
pre-apprenticeships.
■ There have been COVID-induced career changes, which comes with transitioning
skillsets and navigating different careers. There are infrastructure, policy, and administrative barriers.
■ Cost of logging has gone down, which has maximized efficiency but eliminated jobs. ■ There is a severe childcare shortage, even for employees that work standard hours.
■ Hiring benefits are in place but there is a lack of interest from potential employees. There are long waitlists and only 4-5 desirable childcare centers.
• Strategies to recruit and retain employees: Benefits include $15/hour minimum ■ There is inadequate broadband that impacts ability to do virtual school.
wage, hiring, Christmas, and referral bonuses, overtime ■ Changes to immigration reform and federal immigration policy negatively impact
the Quinault.
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■ Federally recognized tribes are not eligible for state funds for water, sewer, and DECEMBER 16
SEATTLE METROPOLITAN CHAMBER OF COMMERCE REACH
storm repairs.
• Goals to relocate villages to higher ground. Affordable housing and cost of living impact the ability to build wealth and
the workforce
• Inadequate broadband, water, and sewer prevents additional housing or
construction. ■ Housing is a primary means to build wealth, and the increase in housing prices
impacts access to housing as a wealth building tool.
• The Quinault moved forward with their wellness clinic without additional funding.
■ It is difficult to find employees for all job levels because they cannot afford to live
■ Projects are delayed due to permitting and associated costs; long EIN processes.
nearby.
■ Affordable electricity is an issue, especially with newer developments (ex. Seabrook)
■ There is a lack of transportation to jobs.
■ There is poor education in Grays Harbor County, and the only options are private
■ Suggestions included:
schools and the school in Montesano.
• Find short term ways to help people build good wealth.
■ Enterprises are suffering with a need for employees that can’t be filled.
• Pair transportation and affordable housing for all income levels.
• Ex: Hiring at the Sweetgrass Hotel in Ocean Shores.
• Involve employers in affordable housing to address the needs they have.
■ Lack of infrastructure to support economic growth (housing, jobs).
• Develop community ownership methods.
■ Suggestions included:
• Investing in childcare options, particularly for non-standard hours.
• Tribal access to grants for infrastructure improvements, including water, sewer,
and broadband. Workforce barriers include training and access to resources.
• Streamline regulation and permitting fees. ■ It is difficult to navigate the ecosystem on a state level. CBOs and network
• Support to help burdened communities access funds, including tribes. partnerships help address this.
• Invest in natural resources. ■ Education is the entry to high level jobs.
• Continue grants for river restoration and continue restoration work on the ■ Suggestions included:
Quinault River. • Vocational and traditional training.
• Help employees and small businesses get the information they need.
Business growth is stymied by access to capital, access to resources, and lack
of support.
■ Support for small businesses and availability of technical assistance has room
for growth.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | ENGAGEMENT – DETAILED NOTES | WA LCEDIR 78
Appendix
Washington State Legislative Committee on Economic Development & International Relations (WA LCEDIR)
■ Small businesses, start-ups, and venture capital need access to capital and ■ Construction Worker:
alternatives to credit.
• Layoffs for workers were extended after negotiations for strike.
■ Commercial availability is a barrier to business growth.
• Filed for unemployment and didn’t receive help for several months.
■ Suggestions included:
• Went back to school but had to return to work to continue to earn wages.
• Coordinated access to export opportunities.
• Job instability is a risk and very hard.
• Resources to help people start and grow their businesses, including:
• Suggestions included:
- Culturally appropriate and in-language resources.
- Online or hybrid programs that are offered on the weekends to accommodate
- Technical assistance to build knowledge base and financial access, and access workers with 8-10 hour weekday shifts.
to capital.
■ Former Aerospace Consultant:
- Static and interactive resources.
• Called unemployment in December 2020 but wasn’t placed into TAA orientation
until August and will start school in early 2022.
• Was not assigned a case manager for several months.
DECEMBER 20 • Automated unemployment process was hard to navigate with lots of hoops to
WASHINGTON STATE LABOR COUNCIL WORKER GROUP jump through.
Workforce barriers include training and access to resources. • Lack of support.
• Had to pay back wages.
■ Public School District bus drivers and nutrition services:
• Workforce was laid off at the beginning of the pandemic. Hours and shared work The unemployment process is broken—it takes too long, there is no clear point of
program were cut, leaving the workforce without enough jobs. contact or direction for support or help.
• Many employees moved to different states.
• Workers filed for unemployment, and some were denied or disqualified because
of reasonable assurance that jobs will be provided.
• Working to bargain with the school district and ESD and appeals won’t be heard
until March 2022.
• Wages are being garnished.
• Eliminated contracts, and difficult to find qualified workers or those that have
been certified to be school bus drivers.
• Unclear on point of contact or where to go for help or answers.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | ENGAGEMENT – DETAILED NOTES | WA LCEDIR 79
Washington State Legislative Committee on Economic Development & International Relations (WA LCEDIR)
Outreach to collect perspectives from community.
In most focus groups, participants emphasized the importance of outreach to gather
community perspectives on barriers. Participants felt this was important for the State to
In addition to the key topics listed above, employees stated that they
understand the unique barriers each community faces across the geography of the state
need support in the following areas:
to make necessary investments. Location, cultural and language needs, and historical
■ Health care costs reduced or paid for, including for mental health context are among a few factors that participants shared.
■ Overtime compensation for hourly workers
Next Steps & Best Practices
■ Financial support for displaced workers
Input from focus group participants either helped to confirm existing barriers identified
■ Reduced cost or paid for childcare
by EcoNW in their analysis of Washington State’s economy, highlighted additional barriers
■ Support for employee rights and wellbeing, including the right and issues in the engaged communities, or supported the overall recommendations
to unionize, employee flexibility to accommodate schedules and made in this report. Facilitators followed up with participants to share the notes from
other commitments, mental health resources, and diversity, equity and each meeting and will share with them the final recommendations report submitted to
inclusion training the Lieutenant Governor in January 2022.
■ Quality jobs defined by flexibility during work hours to care for children,
elders, or handle other daytime commitments, side hustles, etc. Two key limitations in engaging communities throughout this process included the:
■ Safe and supportive workplaces for LGBTQI groups, including education 1 Condensed timeline for connecting with hard-to-reach communities
or workplace conduct training
2 Inability to compensate participants for their time
Small business owners stated that they need support in the following areas:
In the future, Triangle recommends instilling best practices including extending the
■ Cultural and linguistically specific support, including in-language
outreach timeline to maximize participation and offering stipends or compensation to
materials, administrative assistance, digital access, consistent access to
participants to increase participation and reach a broader swath of communities across
resources, and professional development
the state.
■ Incentives to contract with small or minority-owned businesses
■ Improved access to resources and information, including financial aid,
small business support, and how to find assistance
■ Universal employee benefits, including healthcare and other luxury
expenses to reduce cost burdens on small business expenses
■ Equitable opportunities for small businesses and non-profits to receive
funding and employment opportunities
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | ENGAGEMENT – DETAILED NOTES | WA LCEDIR 80
APPENDIX C
FOUNDATIONAL ITEMS AND THEMES
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
Housing
Washington State has the fewest housing units per household of any state
One way to track housing supply and availability is by calculating the number of homes
per household. Washington has only 1.06 housing units per household compared to the
national average of 1.14. When accounting for normal vacancy and second homes, this low
housing ratio means that there are not enough units to meet housing need in Washington.
Even counties with seemingly higher ratios tend to have higher ratios of second homes. This
lack of supply is putting strong upward pressure on home prices and rents. Homeownership
is becoming more unattainable, particularly for households of color, and affordable rental
housing continues to be out of reach across the state.1 Since 2010, the housing crises is
getting worse as the number of units built has not kept pace with household formation
1.14
housing units per household
1.06
housing units per household
over the last decade.2 nationally in Washington
The underproduction of housing is limiting economic productivity, the creation of
An inadequate supply of housing causes challenges for:
jobs and perpetuating disparate outcomes of wealth inequity for the next generation
of Washingtonians. ■ Talent attraction—Relocating workers who must compete for already
limited housing.1
RATIO OF HOUSING UNITS TO HOUSEHOLDS IN 2020
■ Costs due to higher wages—Employers need to pay workers more to afford
the region.3
■ Ability to replace workers—Employers may have to recruit workers from
hours away.
■ Retain customers—Housing costs may drive lower / middle income residents
/ customers to other areas.
■ Business attraction—Businesses may not want to expand to the area due to
risk of not being able to secure labor
■ Job stability and educational outcomes—People are priced out of already
precarious living situations.4
“Misallocation arises because the constraints on housing supply in
the most productive US cities effectively limit the number of workers
who have access to such high productivity. Instead of increasing
local employment, productivity growth in housing-constrained cities
1.0 – 1.05 1.05 – 1.1 1.1 – 1.14 1.14 – 1.25 1.25 or More
primarily pushes up housing prices and nominal wages.”
Source: U.S. Census, Washington Office of Financial Management
— Hsieh and Moretti, 2019
1
Ilina Logani. “Washington State’s Housing Affordability Crisis.” Office of Lieutenant Governor Denny Heck. (2021).
2
U.S. Census, Washington Office of Financial Management
3
Chang-Tai Hsieh and Enrico Moretti. “Housing Constraints and spatial misallocation.” American Economic Journal: Macroeconomics, 11(2): 1-39. (2019). https://pubs.aeaweb.org/doi/pdfplus/10.1257/mac.20170388
4
Up for Growth. “Housing underproduction in Washington State.” (2020).
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | HOUSING 82
Housing
Washington State has the fewest housing units per household of any state
Current Efforts to overturn local bans on “missing middle” housing. This would allow for the creation
of a greater variety of housing types such as duplexes and townhouses in most areas
The Department of Commerce provides a variety of tools to local governments, nonprofits
of large and mid-size cities, effectively banning single-family zoning.7 The proposed
and community action agencies to support affordable housing including administering
legislation, meant to address homelessness, also includes $800 million in investments in
the housing trust fund (HTF). While investments are significant, they are not enough to
permanent supportive housing and behavioral health facilities. However, similar bills (HB
support the growing need for affordable homes.
2780 and SB 6536) which sought to re-legalize middle housing in most of the state were
killed in 2020.
Remaining Gaps
Despite current efforts Washington is still not building enough homes, especially
homes that are affordable at lower incomes. Many of the barriers to increasing housing
production identified in the 2020 Housing Underproduction in Washington State report
and the 2021 Housing Affordability Crisis report remain, including:
■ Zoning restrictions, biased against high-density sites, that prevent adding
“missing middle” units in single-family neighborhoods often driven by NIMBYism.
Statewide policies to overturn local bans on “missing middle” housing have been
proposed but not yet passed.
■ Escalating and misaligned fee structures, such as impact and linkage fees.
Recent notable legislation to address the housing crisis include:
■ Poorly calibrated inclusionary housing requirements.
■ HB 1406 (2019) allows local jurisdictions to impose a local state-shared sales and ■ Lengthy review processes that invite gaming and abuse by growth opponents.
use tax to fund affordable or supportive housing.
■ Future labor concerns especially in the construction trades.
■ HB 1923 (2019) establishes incentives to encourage more urban residential building
capacity. HB 2343 and SB 6334 build on HB 1923 to expand housing capacity.5
■ HB 1220 (2021) strengthened the Growth Management Act Housing goal from
“encourage the availability of affordable housing to all economic segments of the
population” to “plan for and accommodate housing affordable to alle economic
segments of the population of the state.”6 Requires anti-displacement measures.
Governor Inslee recently put forward a package of housing policies for the legislature
to consider in 2022 to address some of these gaps which included a statewide policy
5
“2019 affordable housing update.” Washington State Department of Commerce. (2020). https://www.commerce.wa.gov/wp-content/uploads/2020/03/2019-AHAB-Annual-Report.pdf
6
“2021 legislative changes to the housing laws: guidance for HB 1220 and related bills.” Washington State Department of Commerce. (2021). https://deptofcommerce.app.box.com/s/i01k0sghwo0oo8pf8tnk307i96c689s0
7
Governor Jay Inslee. “Inslee announces bold proposals for homelessness.” (December 15, 2021). https://www.governor.wa.gov/sites/default/files/Homelessness_PolicyBrief_Dec14.pdf
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | HOUSING 83
Workforce Replacement
Businesses of all sizes are struggling to find workers to fill vacancies
One of the basic inputs of any enterprise is labor, and that input is lacking in 2021. This is
likely the overlap of various factors including: a larger than normal wave of retirements
brought on by the COVID pandemic, hesitancy to return to environments some workers
may consider unsafe, financial flexibility to wait and pursue jobs that provide better pay
or benefits, limited access to childcare, and an economy rebounding from the pandemic.
Many Americans were able to increase their savings in 2020 and 2021. Various federal
one-time and ongoing financial assistance programs provided extra cash while pandemic
limitations reduced spending on typical goods and services. Some also had equity
investments that saw high returns. Placed in stronger financial situations, many were
able to wait to return to work. At the same time, certain parts of the economy were
thriving, significantly increasing their hiring to keep up with demand. E-commerce
increased dramatically, and with it the need for transportation, warehousing, and
delivery services. Health care was further fueled by the pandemic. This has resulted in an
advantageous position for workers, as employers are in great need while laborers have
the financial stability to wait and move around to higher paying positions or careers with
greater benefits.
PERCENT OF ALL WORKERS AGED 55 AND OLDER, STATEWIDE IN WA
25%
While many of the factors driven by the pandemic will likely resolve themselves,
20% vacancies will be a continuing challenge as a large share of the workforce reaches
retirement age e.g., “the Silver Tsunami.” The share of workers aged 55 and older in
Washington is at an all-time high, and a strong stock and real estate market may
15%
provide the financial stability many need to step away from working. Some may also
be retiring early to assist with childcare responsibilities for their children or extended
10%
family due to the issues surrounding schools and childcare. Many of these vacancies
will be in high-skill positions including the trades and may take years to replace the
5%
knowledge developed over decades. Continued business growth, especially in STEM
and other high demand fields will further fuel the need for workers.
0%
90 92 94 96 98 00 02 04 06 08 10 12 14 16 18
19 19 19 19 19 20 20 20 20 20 20 20 20 20 20
Source: Quarterly Workforce Indicators
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | WORKFORCE REPLACEMENT 84
Workforce Replacement
Businesses of all sizes are struggling to find workers to fill vacancies
Remaining Gaps
Despite current efforts to boost educational attainment, particularly in high-demand
fields such as STEM and healthcare, there is a chronic skills gap between the skills
employers need and the skills jobseekers have. The 2017 Skilled and Educated Workforce
report projected a shortage of 20,000 skilled workers annually between 2020 to 2025.
This would require a 30% increase in the number of certificates and degrees granted
in the state. Despite this data being several years old, the prognosis is unlikely to have
improved given the ongoing challenges with the pandemic. While strong workforce
demand is seen at all education levels, particularly in STEM, workers with mid-level
skills (associates, certificates, and apprenticeship completers) are in particular demand
making up half of the projected need. The 2019 Skilled and Educated Workforce report
identified the greatest mid-level workforce needs are in production and trades; business,
Current Efforts management, and sales; human and protective services; health professions; and
Some of the workforce shortage caused by the pandemic will likely resolve itself without computer and information science.8
state intervention. Employers are increasing wages and adding various benefits, both
the traditional health insurance and more time off, and now educational assistance Midlevel Bachelor’s Graduate Total
for upskilling. In addition, severe COVID cases are declining, and vaccine utilization is Projected annual job openings for
43,500 33,397 17,410 94,307
growing, hopefully allowing some additional comfort to return to work. Most likely skilled workforce (2020–2025)
savings are also starting to slide as no new stimulus has been provided in recent months, Current annual supply of workers 34,996 28,455 10,698 74,149
and enhanced unemployment insurance has expired. Net In-Migration (2011–2015) 1,487 3,246 5,852 10,585
However, replacing a skilled, retiring workforce will be more challenging. State and local Remaining Gap 7,017 1,696 860 9,573
workforce development entities offer a variety of programs to help develop the talent
pipeline and connect workers with training programs and job opportunities. Additionally Source: Adapted from “A Skilled and Educated Workforce 2017 Update.” Washington Student Achievement Council
targeted state funding for expanding STEM programs at Washington’s public universities
has helped drive success in degree production. Private organizations are also working to
improve workforce development efforts. The Washington Workforce Portal, a project of
the AWB Institute released in 2021 as a pilot effort, is underway in Spokane and the Tri-
Cities as a free workforce-based learning matching program.
The Workforce Education Investment Act (2019) has made workforce education more
affordable. Starting in the 2020-21 academic year, students with family incomes at or
below 100% of the state’s median family income qualify for full tuition scholarships to
college or apprenticeship training programs (aid is determined on a sliding scale).
8
Washington Skilled and Educated Workforce, 2019-2020. https://wsac.wa.gov/sites/default/files/2019-20.WASkilledEducatedWorkforce.pdf
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | WORKFORCE REPLACEMENT 85
Child Care
Washington has the 9th most expensive infant care of any state 9
According to 2019 Child Care Aware data, the average monthly price of full-time childcare
was $939 per child or 16% of the median household income for a family with children under
six. Many families also lack access to licensed childcare facilities with only 35 childcare slots
for infants, toddlers, or preschoolers for every 100 children whose parents work.10
Limited and unaffordable childcare prevents many parents from fully engaging in the
workforce, restricting family economic advancement, and employers from filling jobs.
According to a 2019 report from the Eastern Washington University Institute, employee
childcare issues cost the state’s gross domestic product (GDP) an estimated $6.5 billion in
lost contributions.11
$939
average monthly
16%
of the median household
35
childcare slots for
price of full-time income for a family with every 100 children whose
childcare children under six parents work
AVERAGE CHILDCARE COSTS BY MEDIAN INCOME
Additionally, childcare providers tend to make low wages and lack access to other
benefits including health care. This results in high turnover in the industry with
providers having to compete with other sectors such as retail that offer comparable
or better pay with less training and education.12
Current Efforts
The Fair Start for Kids Act, which was signed into law on May 7, 2021, aims to make
childcare more accessible and affordable throughout the state. The legislation
increases the number of families who can qualify for financial assistance through the
Working Connections Child Care Program (WCCC) by raising income eligibility limits
and reducing income cliffs.13 Over the next seven years the limits will be raised three
times from 200% of the federal poverty level prior to October 1, 2021 to 85% of the
state median income (SMI) by July 1, 2027. The legislation also reduces income cliffs
by preventing co-payments over 7% of family income, which will allow families to
accept raises and promotions without experiencing an offsetting increase in childcare
costs.13
The darker the color, the greater the percent of the median household income for a family spent on child care per child.
Source: https://www.childcareaware.org/our-issues/research/ccdc/state/wa/
9
Economic Policy Center Institute https://www.epi.org/child-care-costs-in-the-united-states/#/WA
10
Child Care Aware Data. (2019). https://www.childcareaware.org/our-issues/research/ccdc/state/wa/
11
The Mounting Costs of Childcare. (2019). Department of Commerce.
12
Washington State Child Care Access Strategy, Child Care Collaborative Task Force Report to the Legislature and Governor under 2SHB 1344, Laws of 2019. (2021). Washington Department of Commerce.
13
FINAL BILL REPORT E2SSB 5237 https://lawfilesext.leg.wa.gov/biennium/2021-22/Pdf/Bill%20Reports/Senate/5237-S2.E%20SBR%20FBR%2021.pdf?q=20210917092716
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | CHILD CARE 86
Child Care
Washington has the 9th most expensive infant care of any state 9
The legislation increases the subsidies providers earn to 85% of market rate from 65% in
2020, enhancing providers ability to pay higher wages.14 The legislation also instructs the
Department of Children, Youth, and Families (DCYF) to build upon the work of the Child
Care Collaborative Task Force to develop and implement a childcare cost estimate model.
This completed model would be used to identify and recommend subsidy rates sufficient
to compensate for the full costs of providing high quality childcare in the future. The
DCYF was further instructed to evaluate options to support access to affordable health
care insurance coverage for licensed or certified childcare providers.
Remaining Gaps
The Fair Start for Kids Act provides a solid foundation for addressing Washington’s gaps in
childcare access and affordability, including providing direction for future research and
improvements. . While it is hard to know right now how effective this legislation will be
at meeting the extent of need in Washington, it certainly provides a strong path forward.
The state should continue to monitor the efficacy of this Act to identify if additional
policy action is warranted in the future.
14
2020 Childcare Policy Recommendations, Child Care Collaborative Task Force Report to the Legislature and Governor under 2SHB 1344, Laws of 2019. (2020).
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | CHILD CARE 87
Broadband
Over 338,000 Washingtonians lack access to a broadband connection
Washington ranks 16th of all states in terms of broadband connection .15 However
current regulatory definitions and measurement techniques may not adequately capture
broadband needs. For example, target speeds of 25/3 are no longer considered adequate
to meet growing demand. Recent work by the U.S. Department of Commerce’s National
Telecommunications and Information Administration indicates that Washington’s
broadband infrastructure needs are much greater.16
Limited access to reliable, affordable, and fast internet access prevents workers from taking
advantage of work from home opportunities or other training opportunities that enhance
economic mobility. Businesses that do not have adequate broadband cannot maintain a
web presence or access certain services. Additionally, the ability to telework may “increases
employee retention and job satisfaction.17” Rural residents are more likely to lack access due
to infrastructure deficiencies, whereas urban residents may have the infrastructure but be
unable to afford it.
MANY WASHINGTONIANS LACK ACCESS TO BROADBAND EITHER ENTIRELY OR AT
Current Efforts
SUFFICIENT SPEEDS TO MEET MODERN DEMANDS The FCC, through its Broadband Data Collection (BDC) program is in the process of
INDICATOR OF NO
updating its current broadband maps with more detailed and precise information
LEVEL YES NO DATA
BROADBAND NEED
on the availability of fixed and mobile broadband services. The BDC program will
Speed Tests – M-lab Median
COUNTY Speeds Fixed Broadband
Below 25/3 Mbps
give the FCC, industry, state, local and Tribal government entities, and consumers
Usage – 75% or More of the tools they need to improve the accuracy of existing maps. This is important for
Devices Connect to Microsoft
Updates/Services via Fixed
Broadband Download Speeds
local and state governments as they determine where to focus efforts to improve /
below 25 Mbps
expand infrastructure.
CENSUS Speed Tests – Ookla Median
Speeds Fixed Broadband
TRACT Below 25/3 Mbps Washington State is also working on improving broadband infrastructure. In 2019 the
American Community Survey
– 25% or More of Households
State Legislature enacted legislation that established access and download / upload
Report No Internet Access
speed goals for residences, businesses, and communities as well as a grant and loan
American Community Survey
– 25% or More of Households program to support the extension of broadband infrastructure to unserved areas.18
Report No Computer,
Smartphone or Tablet
The Washington State Broadband Office mapping initiative will help identify areas of
CENSUS
BLOCK
FCC Form 477 – No Provider
Reports Consumer Fixed
NA
broadband infrastructure need in order to advance the state’s goal to have universal
Broadband Services at
25/3 Mbps
broadband access in Washington by 2024.
Source: NTIA Indicators of Need Map. Accessed October 2021 https://broadbandusa.maps.arcgis.com/apps/webappviewer/index.
html?id=ba2dcd585f5e43cba41b7c1ebf2a43d0
15
BroadbandNow, Washington Internet Coverage and Availability, accessed February 2022. https://broadbandnow.com/Washington
16
The U.S. Department of Commerce’s National Telecommunications and Information Administration (NTIA) has a newly released Indicators of Broadband Need Tool. In addition to using the internet service provider’s (ISP) volunteer data that the FCC primarily relies on, NTIA takes data from
the Microsoft update services, the M-Lab and Ookla speed tests, and the American Community Survey data about internet access and device use. This tool paints a much clearer picture of which areas have the greatest need.
17
Urban Land Institute. “Broadband and Real Estate.” (2021).
18
Second Substitute Senate Bill 5511. https://lawfilesext.leg.wa.gov/biennium/2019-20/Pdf/Bills/Session%20Laws/Senate/5511-S2.SL.pdf?q=20210629153124
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | BROADBAND 88
Broadband
Over 338,000 Washingtonians lack access to a broadband connection
Goals are:
BY 2024 BY 2026 BY 2028
150/150 Mbps all residents
25/3 Mbps scalable 1/1 Gbps all anchor
and businesses
Additionally, the Public Broadband Act which went into effect in July 2021, ended the
restriction on public utilities offering public broadband services directly to residents.
Municipalities will now be better positioned to access federal funding which often
requires telecommunication grant applicants to also deliver service to customers.19
The Infrastructure Investment and Jobs Act allocates a minimum of $100 million to
help provide broadband coverage across the state. The Act will also benefit 19% of
Washingtonians who will be eligible for the Affordability Connectivity Benefit which
helps low-income families afford internet access.20
Remaining Gaps
Washington is already addressing the gaps in access and affordability of broadband by
establishing goals, providing funding, and allowing public utility districts to directly
provide broadband to residents. Established goals go above and beyond current FCC
standards. While there is still a “last mile” challenge for some businesses / workers, the
influx of money from the Infrastructure Investment and Jobs Act will go a long way in
achieving these goals. The real question is how to best leverage the broadband that is
coming to have a strong effect on business.
19
Aaron Kunkler. “Two big broadband bills became effective yesterday.” (July 26, 2021). https://washingtonstatewire.com/two-big-broadband-bills-became-effective-yesterday/
20
The Infrastructure Investment and Jobs Act will Deliver for Washington. https://www.whitehouse.gov/wp-content/uploads/2021/08/WASHINGTON_Infrastructure-Investment-and-Jobs-Act-State-Fact-Sheet.pdf
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | BROADBAND 89
High-growth / Innovation Firms
Washington is forming fewer high-growth potential businesses than a decade ago and less than most peer states
Entrepreneurship has been on the decline nationally and in Washington over the past 40 HIGH-PROPENSITY BUSINESS APPLICATIONS (PER 1K POPULATION) 2020
years.21 Of particular concern, Washington’s high-propensity business formation—those
most likely to turn into a business with a payroll and living wage jobs—have declined
30% from the early 2000s (per capita), and now rank 4th lowest among peer states.22 While
Washington remains competitive on most traditional economic development measures,
low growth in high-propensity firms could indicate limited potential for future economic
expansion and shared prosperity. Factors contributing to the decline of entrepreneurship
include macroeconomic conditions such as population growth and aging, market conditions
/ concentration, and microeconomic policies including the regulatory environment and
access to business supports.23
Limited business formation in after the Great Recession hindered the country’s economic
recovery, however, the pandemic recovery is shaping up differently. Nationally, in 2020
business applications including high-propensity business applications reached all-
time highs. Given the role that employer startups play in job creation, innovation, and
productivity growth, this surge could indicate economic restructuring.24 While most peer
states experienced growth in high-propensity business applications from 2019 to 2020, Source: Business Formation Statistics, Census
Washington declined.
21
Business Dynamics Statistics
22
The identification of high-propensity applications is based on the characteristics of applications revealed on the IRS Form SS-4 that are associated with a high rate of business formation. High-propensity applications include applications: (a) from a corporate entity, (b) that indicate they are hiring
employees, purchasing a business or changing organizational type, (c) that provide a first wages-paid date (planned wages); or (d) that have a NAICS industry code in manufacturing (31-33), a portion of retail (44), health care (62), or accommodation and food services (72). https://ssti.org/blog/useful-
stats-high-propensity-business-applications-state-2006-2020
23
Lisa Abraham and Benjamin K. Master. “Entrepreneurship in America: Challenges and Opportunities.” Rand Corporation. (March 2021).
24
John C. Haltiwanger. “Entrepreneurship during the Covid-19 pandemic: evidence from the business formation statistics.” NBER working paper series. National bureau of Economic Research. (June 2021).
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | HIGH-GROWTH / INNOVATION FIRMS 90
High-growth / Innovation Firms
Washington is forming fewer high-growth potential businesses than a decade ago and less than most peer states
Current Efforts
As the state’s economic development agency, the Washington State Department of
Commerce is involved in ongoing efforts to improve and increase jobs and facilitate
business development in Washington. Commerce focuses on strengthening key high-
growth industries by promoting public-private partnerships, enhancing the workforce,
and advancing strategies that support small business growth and expansion. Small
business supports encompass a variety of programs including education and technical
assistance, grants and loans, and crisis planning. There are also a variety of local and
regional entities that provide supports for entrepreneurship and small business growth.
Recent legislation that could support formation in high-growth businesses includes SHB
1170. Enacted in July 2021, it established the goal of doubling the state’s manufacturing
employment base, the number of small manufacturing businesses, and the number of
women-and minority-owned manufacturing businesses in the next 10 years. It tasks
commerce with identifying and developing strategies to achieve this goal.
Remaining Gaps
Washington has historically done well when measured by traditional economic
indicators. A few leading industries and businesses have driven great success for a subset has room to improve targeted regulatory policies and business supports for high-growth
of the population. This success has masked the need for greater support for, and focus firms. Doubling manufacturing in the state would improve high-propensity business
on, high-growth business formation. Washington, like the rest of the nation, can expect formation, but to date, no specific policies have been developed to achieve this goal.
to continue to grapple with the macroeconomic conditions of an aging population as
well as unstable market conditions exacerbated by the pandemic. However, Washington
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | HIGH-GROWTH / INNOVATION FIRMS 91
Regulatory Environment
A variety of regulatory barriers are discouraging businesses of all kinds from forming, growing, and competing in
the global economy
The regulatory environment is a limiting factor that comes up across industries for both RESIDENTIAL LAND USE REGULATORY RANKING
small and startup businesses as well as expanding businesses. The Wharton Residential LARGEST 44 REGIONS (CBSAS)
Land Use Regulatory Index ranks the Puget Sound regions as the 4th most regulated
region in the country for permitting and land use, behind only New York, San Francisco,
and Providence.
Stakeholders consistently expressed frustration with the complex, costly, growing and
competing regulations that often disproportionately impact small businesses. The
Washington State Auditor’s Office in 2015 found that 26 state agencies administer 1100+
regulations. One rule filing can impose dozens of changes to different sections of the
Washington Administrative Code (WAC) making it challenging for small businesses to
keep track. Studies also suggest that more regulations lead to less business entry and a
greater likelihood of a startups closing. Regulations may harm startups more than large
and established businesses in three ways:25
Disproportionate cost burdens
Economies of scale in compliance
MOST REGULATED MODERATELY REGULATED LEAST REGULATED
Source: Wharton Residential Land Use Regulatory Index, 2018
Entry barriers
Stakeholders also noted that there is limited shovel-ready land for industrial uses due to
land use laws, zoning limitations, and lack of infrastructure. Industrial uses require larger
plots of land which can be hard to come by in urban areas where competing commercial
and residential uses can drive up costs and eat away at current land. Areas that have
larger parcels of land may not be served by adequate infrastructure to sustain industrial “Growth in our town cannot happen without
operations. While land use and growth management has created amenity value and the general infrastructure to be addressed.”
produced environmental benefits in Washington, it has contributed to the limited number
—Survey Respondent
of available and suitable sites for business expansion. An industrial lands analysis in the
Central Puget Sound Region in 2017 found that while the region seems to have sufficient
industrial land for future demand, non-industrial land will likely continue to absorb
industrial jobs and may increasingly do so.
25
Chris Edwards. “Entrepreneurs and regulations: removing state and local barriers to new businesses.” CATO Institute. (May 5, 2021). https://www.cato.org/policy-analysis/entrepreneurs-regulations-removing-state-local-barriers-new-businesses#regulations-businesses
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | REGULATORY ENVIORNMENT 92
Regulatory Environment
A variety of regulatory barriers are discouraging businesses of all kinds from forming, growing, and competing in
the global economy
Current Efforts
Washington has made some strides to centralize and coordinate efforts across regulatory
agencies. The state has improved support for small businesses as they navigate regulatory
processes through infrastructure investments such as the Office of Regulatory Innovation
and Assistance, the Small Business Liaison Team, and the Washington Business Hub.
For the most part individual agencies work to simplify state regulations and improve
practices and policies.
HB 1352, adopted in 2017, required the Attorney General to review the Administrative
Procedure Act, related administrative rules, similar statutes, and case law to identify rights
and protections afforded to small business owners selected for agency enforcement
action. The Attorney General then recommended steps to improve those rights or
protections and/or access to timely information about them.
Remaining Gaps
The regulatory environment is a barrier to business formation and growth. Businesses
would benefit from reduced regulatory complexity as well as further assistance
navigating regulatory processes. A report by the Attorney General’s Office recommended
the following changes26:
1 Improve efforts to provide transparent, accessible information and assistance
to operating businesses early in the process.
2 Improve efforts to share effective practices among agencies.
3 Expand the role of business associations and other groups in coordinating
the sharing of information between small business owners and agencies.
4 Be deliberate about how “small business” is defined.
5 Consider targeted expansion of the use of special advocates or Ombud’s to
help disseminate information and resolve noncompliance issues or disputes.
28
Bob Ferguson Attorney General. “Report to the Legislature, HB 1352.” (November 30, 2017). https://app.leg.wa.gov/ReportsToTheLegislature/Home/GetPDF?fileName=HB%201352%20Final%20Report_b96c86e0-a9ea-4955-ba75-edb5b7180a6a.pdf
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | REGULATORY ENVIORNMENT 93
Access to Capital
Both new and existing businesses lack the capital they need to succeed
Capital is a necessary ingredient to fuel business growth throughout the state. While While data is unavailable at the state level, lack of access to capital remains a
Washington is in the top quartile of states for venture capital investments (trailing the big consistent theme across industries in Washington. It came up in both the focus
two states: California and Massachusetts) many businesses struggle to access it due to a groups and survey results. Stakeholders indicated challenges accessing:
variety of reasons: poor credit or insufficient collateral, discriminatory lending practices
(conscious or unconscious), language barriers, digital barriers, and lack of information on 1 Startup capital to get new businesses off the ground.
resources available and how to obtain them. These barriers are especially acute for people
2 Working capital which includes lines of credit to continue and grow
of color. Black-owned applicant firms were half as likely as White-owned applicant firms to
business. In many cases, federal grant money (in response to COVID) has
be fully approved for loans, lines of credit, and cash advances in 2019.
ceased but businesses are still struggling.
This challenge can be worse for some industries due to the level of risk tolerance
banks are willing to accept. For example, businesses like restaurants and hospitality
can be highly seasonal in nature or have a lot of competitors which may make them
less desirable for bank lending.
AVERAGE SIZE OF VENTURE CAPITAL DEAL BY STATE
$20,000.00
$10,000.00
0
PR WV MS WY IA AL OK ND AK LA NE NV AR SC WI HI ID RI ME IN OH MO MI NH MT KS KY MD TX FL SD NJ NC VA VT TN IL NM AZ CT MN DC GA OR DE PA CO WA UT NY MA CA
1st Quartile 2nd Quartile 3rd Quartile 4th Quartile
$1.92–$478.97 $539.44–$1,600.82 $1,737.22–$2,616.84 $2,920.74–$21,138.46
Source: National Science Foundation: PitchBook, Venture capital and private equity database, data available as of February 2021; U.S. Bureau of Economic Analysis, Gross Domestic Product data (various years), data as of May 2020; Government of Puerto Rico, Office of the
Governor, Gross Domestic Product data (various years), data available as of May 2020
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | ACCESS TO CAPITAL 94
Access to Capital
Both new and existing businesses lack the capital they need to succeed
Current Efforts
The Washington Department of Commerce supports several loan programs targeted SMALL BUSINESS FLEX FUND
toward small business. The Small Business Flex Fund helps small businesses and nonprofits
access up to $150,000 in low-interest loans through Community Development Financial
Institutions (CDFIs). CDFIs have a lower barrier to assistance than traditional funding
UP TO $150,000
institutions. In addition, ARPA reauthorized and expanded the Small Business Jobs Act IN LOW-INTEREST LOANS THROUGH CDFIS
of 2010, which established the original State Small Business Credit Initiative (SSBCI)
program. The new version of the program provides a combined $10 billion to states, the
SMALL BUSINESS JOBS ACT OF 2010
District of Columbia, territories, and Tribal governments to empower small businesses
to access capital needed to invest in job-creating opportunities. The funds will support
recipient jurisdictions in promoting American entrepreneurship and democratizing
COMBINED $10B
access to startup capital across the country, including in underserved communities. FOR JOB-CREATING OPPORTUNITIES
The Equitable Access to Credit Act (HB1015) is also under consideration by the Washington
State legislature. If passed it would award grants to qualified lending institutions (QLIs) to Remaining Gaps
provide access to credit for underserved, largely rural communities.
Many of these programs are time limited and rely on funds being reallocated. There is
not a consistent source of funding. Additionally, while equity has risen to the forefront
of consideration fueled by the pandemic, ensuring that underserved groups are able to
OUTCOMES OF LOAN, LINE OF CREDIT, access funding will require more than just ensuring funding is available. It will also require
AND MERCHANT CASH ADVANCE APPLICANT, PRIOR 12 MONTHS flexible opportunities for access (due to lack of collateral), as well as technical assistance
(% OF EMPLOYER FIRM LOAN, LINE OF CREDIT, AND CASH ADVANCE APPLICANTS)
and language and culturally appropriate information. There may also be opportunities to
target certain high-propensity businesses which are desirable to grow jobs.
FULLY APPROVED PARTIALLY APPROVED DENIED
Source: Small Business Credit Survey, 2021 Report on Firms Owned by People of Color.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | FOUNDATIONAL ITEMS AND THEMES | ACCESS TO CAPITAL 95
APPENDIX D
BUSINESS COMPETITIVENESS METRICS
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth
Appendix
Business Competitiveness Metrics
A comparative metrics dashboard designed to create a data-driven narrative and shape state strategy.
To keep this new definition of economic competitiveness front-and-center in policy
and strategy discussions, the following section details a repeatable approach to create
a dashboard that assigns specific metrics that measure capacity builders and realized
outcomes as described throughout the report. This section:
■ Creates an approach for a dashboard.
■ Identifies appropriate peer states for Washington.
■ Specifies data points that best capture key realized outcomes and capacity builders.
■ Documents how data can be used to track performance over time.
Peer State Selection
In each of the metrics in this dashboard, Washington is
compared against a set of 16 other states that meet the
following criteria:
■ Size: between half the size of Washington and twice Metrics and Definitions
the size of Washington (3.5 million to 14 million). This section details the 14 specific measures selected for the comparative metrics
■ Innovation: rank in top 30 of ITIF’s State New dashboard and the rationale for including each.
Economy Ranking, which combines data on The general approach to selecting these metrics was to identify those that were
knowledge jobs, globalization, economic dynamism, aligned with the realized outcomes and capacity builders described in the report and
digital infrastructure, and innovation. met these criteria:
■ Economic Geography: the second largest metro area
■ Regularly updated.
in the state has a population of at least 400,000, in
order to capture states that have to balance the needs ■ Can be disaggregated by race.
of multiple metro areas in addition to rural areas. ■ Available at the state and local level (county or metro area).
In addition to these 16 states, Washington is also In several cases, it wasn’t possible to satisfy all three of these criteria, but overall the
compared to California, Idaho, Texas, and South Carolina, dashboard focuses heavily on racial equity. Where possible, the dashboard includes data
because they are of particular interest to leaders in on the state’s Black population rather than the BIPOC or minority populations, because in
Washington, despite not meeting the above criteria. The some cases that aggregated data can obscure the size of White-Black disparities, which
group of 21 states, including Washington, is as follows. are typically the most disparate.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | BUSINESS COMPETITIVENESS METRICS 97
Appendix
Business Competitiveness Metrics
Metrics for Key Outcomes — Quality Jobs
QUALITY JOBS HOURLY WAGE THRESHOLD BY COUNTY, 2021
Quality Jobs
The following two metrics were used to represent quality jobs:
■ Share of working-age adults (18-64 years old) with a quality job.
■ Share of Black working-age adults with a quality job.
Definition and Rationale
There is no simple way to define a quality job. At minimum, however, a quality job should
allow families to cover their basic expenses: food, childcare, health insurance, housing,
transportation, and other necessities. There are several “living wage” calculators that
measure, by region and family type, what hourly wage meets this threshold. The living
wage in a given region can vary substantially based on family type. According to the MIT Source: MIT Living Wage Calculator, The Brookings Institution, Census PUMS
Living Wage calculator, the living wage in the Seattle metro area ranges from about $19
per hour for a single adult without children to $58 per hour for a single adult with three represents approximately the wage that would lift half of currently-struggling families
children. For the purposes of economic strategy and policy, however, there needs to be a in each county to self-sufficiency. This approach was then replicated for each of the peer
single wage threshold that can be used to measure performance. states, allowing for the calculation of the number of jobs in each state that pay above
the threshold of “family-sustaining”, and for the purpose of this report are referred to as
In 2021, The Brookings Institution did an analysis of wage levels required to lift half of quality jobs.
economically struggling families to self-sufficiency in different regions. For example, in
Seattle, almost 35% of families are economically struggling, and a wage of about $25 It is important to note again that this is a self-sufficiency wage, not a thriving wage.
per hour would be enough to lift half of those families to self-sufficiency. For example, It enables only half of families to be self-sufficient – and self-sufficiency is a low bar. It
earning a $25 per hour wage would be enough to move a family with two working adults does not provide for entertainment, restaurant meals, any time off work for leisure or
and two children to self-sufficiency, but not enough for a family with one working adult education, or savings for housing or education. Some may perceive this to be too modest
and three children. The Brookings Institution called these “family-sustaining” wages. To a goal for Washington leaders to have in mind when making policy and investment
apply this approach to all of Washington, we compared Brookings “family-sustaining” decisions, but the reality is that currently only 34% of workers in the state have a job that
wages to data from the MIT Living Wage Calculator, which is available for every county meets this threshold. Strategies and policies that aimed to create more jobs that meet
in Washington to analyze how they compare. This approach to defining a quality job this threshold would substantially improve the quality of jobs in the state.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | BUSINESS COMPETITIVENESS METRICS 98
Appendix
Business Competitiveness Metrics
Metrics for Key Outcomes — Wealth Creation
Definition and Rationale
Wealth Creation There is very limited data available to directly measure individual or household wealth,
and no data that does so directly with detail by race/ethnicity. The metrics selected for this
The following four metrics were used to represent wealth creation:
portion of the dashboard use proxies to explore wealth creation trends and disparities in
■ Share of households 18 to 64 years old that own their homes. Washington. As previously mentioned in the report, there is an opportunity for the State
to conduct additional research to produce and maintain metrics that directly measure
■ Share of Black households 18 to 64 years old that own their homes.
wealth by race/ethnicity.
■ High-growth potential business applications per capita.
This dashboard uses homeownership and ownership of high-growth businesses as
■ Proportion of businesses owned by minorities in high proxies for wealth. Homeownership, and in this instance measured as the rate of
growth industries. homeownership, is well documented as a key contributor to household wealth. The
emphasis on high-growth businesses merits further explanation. A small share of
businesses are responsible for the majority of growth, and therefore wealth creation.
The metrics in this dashboard are designed to capture these high-growth potential
businesses, as the growth of a business is what leads to wealth creation. The Census
BIPOC-OWNED HIGH-GROWTH POTENTIAL BUSINESSES — FAIR SHARE RATIO Bureau tracks firms whose business applications are for corporate entities, or indicate
that they plan on hiring employees, or fall into certain high-growth industries.
There isn’t data available on ownership of these high-growth potential businesses by
race/ethnicity. To fill this gap, the Annual Survey of Entrepreneurs measures ownership
of businesses by race/ethnicity within individual industries at the state level. The
dashboard summarizes data on BIPOC-owned business in three traded-sector industries
(professional services, manufacturing, and information technology) in which high-
growth, innovation-driven firms are concentrated. In order to evaluate if businesses
owned by people of color are underrepresented, the share of BIPOC-owned businesses
needs to be weighted by the share of population in each state. For example, 9.9% of
businesses in these growth oriented traded sector industries are BIPOC-owned in
Washington State, compared to 33% of the total statewide population. Weighted by the
share of population in Washington State these business owners are underrepresented by
3.29 times—higher proportions indicate more underrepresentation.
Source: Census Annual Survey of Entrepreneurs
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | BUSINESS COMPETITIVENESS METRICS 99
Appendix
Business Competitiveness Metrics
Metrics for Key Outcomes — Talent Development and Innovation
Talent Development Innovation
The following four metrics were used to represent talent development: The following four metrics were used to represent innovation:
■ Share of young adults (age 25-34) with associate’s degree ■ Share of workers in advanced industries
■ Share of Black young adults with associate’s degree ■ Share of Black workers in advanced industries
■ Share of young adults with bachelor’s degree ■ Share of jobs in young firms
■ Share of Black young adults with bachelor’s degree ■ Output per worker (productivity)
Definition and Rationale Definition and Rationale
Educational attainment does not translate as As with education, innovation does not translate directly to widespread and equitable
directly into economic opportunity as is often opportunity. Many measures of innovation, including patent rates, R&D spending, and
believed. For example, wages of the bottom venture capital funding, tend to reflect what is happening among just a few large and
60% of earners among college graduates fell fast-growing firms. A state like Washington can excel in these measures due to the
from 2000 to 2018. There is, however, still on outsized impact of a few large Seattle-area employers, while at the same time many
average a wage premium for workers with a workers across the state are excluded from the benefits of this innovation. It is important
college degree: those with an associate’s degree to understand whether the typical Washington firm is innovating and becoming more
make 33% more over their lifetime than high productive. Data on individual firm performance isn’t available in any public datasets.
school graduates, and those with a bachelor’s However, the quality jobs metric can serve as proxy, capturing whether Washington firms
degree make almost 75% more. Even if the wage are successful enough to pay a family sustaining wage. Nevertheless, innovation is still a
premium for graduates continues to decrease in crucial precondition for quality, sustained growth.
coming years, creating equitable opportunities
for Washington residents to develop their talents Advanced Industries are a set of 50 industries, as defined by The Brookings Institution
is fundamental to quality growth. Data for other and McKinsey, that are highly R&D-intensive and employ above-average shares of
forms of talent development (e.g., certificates and workers with STEM skills. These industries not only provide quality jobs for workers within
apprenticeships) is limited, these are important them, but also create many “spillover” jobs in supply chains and local services. Similarly,
and valuable opportunities for skill development. employment in young firms matters because it captures the impact of entrepreneurship
Creating a more robust dataset in the State would —as in, whether newly-created firms are actually achieving significant growth in their first
be valuable for tracking progress, and could be five years. Productivity is a crucial measure of an economy’s ability to create opportunity
included in the dashboard in the future. —without increased productivity, it is difficult to achieve sustained increases in wages.
As Nobel laureate Paul Krugman has said: “Productivity isn’t everything, but in the long
run it is almost everything”.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | BUSINESS COMPETITIVENESS METRICS 100
Appendix
Business Competitiveness Metrics
Pulling the Data Together: A Business Competitiveness Index
While each of the fourteen data points in this dashboard is meaningful in its own right, there may be venues in which it is important to have just one or two top-line numbers
that capture whether Washington’s economy is moving in the right direction and improving relative to peer states. This new set of metrics is an alternative to existing high-
profile rankings for public- and private-sector leaders that focuses on prioritized outcomes and the leading indicators enabling those outcomes. We propose a straightforward
approach to creating such an index.
The index includes two metrics:
1 Washington’s overall performance on capacity builders relative to peer states.
2 Washington’s overall performance on key realized outcomes relative to
peer states.
Overall performance is calculated as a simple average of the state’s rank on
each metric in the category.
Following this approach, using the latest data available, Washington ranks 1st among 21
states on capacity builders, ahead of the next highest performers Colorado, Virginia, and
Massachusetts. However, Washington ranks 15th out of 21 states on realized outcomes
(between Missouri at 14th and South Carolina at 16th).
The discrepancy between Washington’s rank on capacity builders and realized outcomes
is what this index is designed to highlight. It emphasizes that despite having more “raw
material” than any other state, in terms of talent and innovation, Washington does not
currently have the policies and practices in place to generate widespread and equitable
opportunity. The index providers a framework for policymakers to evaluate priorities and
the effectiveness of their implementation through a consistent evaluation tool. Currently
the dashboard reveals that a more targeted portfolio of policies and investments is
needed that are focused on improving realized outcomes. Washington cannot simply
continue to boost its performance on capacity builders (bachelor’s attainment, advanced
industries employment, etc.) and expect widespread and equitable opportunity to result.
Rather, more targeted interventions are needed that prioritize creating quality jobs and
opportunities to create wealth, particularly for people of color. For example, specifically
targeting growth in industries or occupations that create quality jobs for workers without
college degrees, or creating programs and funds specifically targeted at entrepreneurs
of color.
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | BUSINESS COMPETITIVENESS METRICS 101
Appendix
Business Competitiveness Metrics
Pulling the Data Together: A Business Competitiveness Index
BUSINESS COMPETITIVENESS PEER STATE DASHBOARD — CAPACITY BUILDERS BUSINESS COMPETITIVENESS PEER STATE DASHBOARD — REALIZED OUTCOMES
ADV JOBS IN HIGH-GROWTH HIGH-GROWTH
POTENTIAL
CAPACITY CAPACITY BACHELOR’S ASSOCIATE’S ADV INDUSTRIES, YOUNG JOBS PRO- REALIZED REALIZED HOMEOWN- HOMEOWNER- POTENTIAL BUSINESSES,
BUILDERS BUILDERS BACHELOR’S BLACK ASSOCIATE’S BLACK INDUSTRIES, BLACK FIRMS DUCTIVITY OUTCOMES OUTCOMES QUALITY JOBS, QUALITY JOBS, ERSHIP, ALL SHIP, BLACK BUSINESSES, MINORITY-OWNED
PEER STATE AVERAGE RANK ALL (2019) (2019) ALL (2019) (2019) ALL (2020) (2020) (2020) (2020) PEER STATE AVERAGE RANK ALL (2019) BLACK (2019) (2019) (2019) ALL (2020) (2020)
WASHINGTON 4.4 1 9 8 3 4 1 4 5 1 WASHINGTON 12.8 15 8 5 17 21 18 8
ARIZONA 13.3 18 21 11 9 9 19 14 8 15 ARIZONA 16.7 20 17 16 20 20 13 14
CALIFORNIA 8.4 5 10 4 17 16 7 10 1 2 CALIFORNIA 12.7 13 19 11 21 18 4 3
COLORADO 6.4 2 4 5 16 3 5 6 3 9 COLORADO 10.0 10 9 12 12 8 3 16
CONNECTICUT 11.9 13 3 6 20 15 8 19 21 3 CONNECTICUT 9.8 9 1 4 9 5 21 19
GEORGIA 11.6 11 13 10 13 10 16 11 9 11 GEORGIA 9.0 7 16 13 15 3 1 6
IDAHO 12.9 16 20 16 1 1 21 21 2 21 IDAHO 12.3 11 15 14 2 13 9 21
ILLINOIS 11.8 12 6 12 10 11 14 15 19 7 ILLINOIS 7.5 3 6 10 6 12 2 9
MARYLAND 9.8 6 5 2 18 20 6 5 16 6 MARYLAND 3.3 1 4 1 5 1 5 4
MASSACHUSETTS 8.1 4 1 1 21 5 4 17 12 4 MASSACHUSETTS 13.3 17 5 15 18 14 16 12
MICHIGAN 12.1 14 17 21 6 14 3 1 18 17 MICHIGAN 8.8 5 11 17 1 9 8 7
MISSOURI 12.9 16 11 18 4 6 17 13 15 19 MISSOURI 12.7 13 13 9 7 17 15 15
NEW JERSEY 11.1 9 2 3 19 18 13 18 11 5 NEW JERSEY 5.5 2 2 3 13 7 6 2
NORTH CAROLINA 11.4 10 12 14 5 17 12 8 10 13 NORTH CAROLINA 14.2 18 18 20 14 6 10 17
OHIO 15.9 21 16 20 11 21 11 12 20 16 OHIO 14.2 18 7 19 8 19 19 13
OREGON 12.4 15 14 17 12 2 18 16 6 14 OREGON 16.7 20 20 18 19 16 17 10
PENNSYLVANIA 14.5 20 8 13 7 19 20 20 17 12 PENNSYLVANIA 8.8 5 3 6 3 10 20 11
SOUTH CAROLINA 10.9 8 19 19 2 8 9 3 7 20 SOUTH CAROLINA 13.2 16 21 21 4 2 11 20
TENNESSEE 14.1 19 15 15 15 12 15 9 14 18 TENNESSEE 12.3 11 14 7 10 11 14 18
TEXAS 10.1 7 18 7 14 13 10 7 4 8 TEXAS 9.2 8 10 2 16 15 7 5
VIRGINIA 7.3 3 7 9 8 7 2 2 13 10 VIRGINIA 7.8 4 11 8 11 4 12 1
REDEFINING ECONOMIC SUCCESS IN WASHINGTON STATE: 3 Keys to Quality Growth APPENDIX | BUSINESS COMPETITIVENESS METRICS 102
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