Economic evolution

Once, not too long ago, you could see hundreds of logs floating in the Spokane River as you drove into Coeur d’Alene. They formed the entryway to Coeur d’Alene, along with the mountains and the glorious lake. They were also the symbol of the economics driving the Inland Northwest. This was a region that grew rich on timber, mining and agriculture.

The river logs will disappear from Coeur d’Alene in May. Stimson Lumber’s DeArmond mill – the last sawmill on the river in Coeur d’Alene – will close. The end has been coming for some time, but mill owners chose to close sooner rather than later due to the housing downturn. Stimson will sell the sawmill to Black Rock Development, and community leaders then hope to put together financing to purchase it from Black Rock for an educational corridor. This will allow expansion of North Idaho College and outreach programs from Idaho universities.

There’s symbolism in that, too. The Inland Northwest is in transition to new economy ventures. Tourism is one example. Upscale housing that attracts transplants from bigger cities is another. But education is the sleeper among us.

Gonzaga, Whitworth, Eastern Washington University and North Idaho College are experiencing enrollment booms. Some of their students graduate and stay here. The colleges and universities also draw highly educated faculty to the region. The better educated a region, the more desirable its business climate. Forbes just released its 2008 list of best places to do business. Spokane was ranked No. 9. Education of the labor force is one factor in these rankings; Spokane still has a ways to go there, but vibrant universities will surely help.

And so the economic cycles continue, and sawmills make way for learning institutions. But the old economy businesses can teach us some lessons about the new economy. Ups and downs are inevitable. Plan for them. Even in the high-demand years, timber and mining were beset by downturns, accidents and worker strikes. Another lesson: Don’t count out old economy businesses too quickly. Wheat farmers raised a crop filled with dollar signs in 2007. Kaiser Aluminum, one of the biggest employers in the old economy, emerged from bankruptcy two years ago and grows once again.

New economy ventures are risky, too. A year ago, outsiders bid feverishly for Inland Northwest lake and river property. The fever broke. And a Spokane company, BlueRay Technologies, is experiencing startup delays, despite its plan to manufacture Sony’s Blu-ray Disc, the latest home video technology.

The challenge remains to seek out economic diversification. The more varied the businesses, institutions and entrepreneurial endeavors, the more ability a region has to remain stable in the lean times.

“We understand that it’s a business,” mill worker Jason Taylor said in reaction to the news of the sawmill’s last days.

And now that business will become history. Thanks, Stimson Lumber, for your company’s contribution to the region’s continuing economic story.