Arrow-right Camera


Vestal: Glimmers of hope or clouds of economic gloom?

Shawn Vestal

How’s our economy? Improving? Turning around?

That’s the conventional wisdom – that here in Spokane and in North Idaho, we are crawling toward recovery. When the economists talk about next year, they tend to predict more of the same: slow growth. Media reports – even when noting minuscule changes in the jobless rate or other factors – tend to take a similar line.

The glass is not 97 percent empty, in other words. It’s 3 percent full.

Two recent evaluations of the local economy – one national and one local – take the opposite view, arguing that there is reason for abundant caution in the cautious optimism.

First, a new report from the Milken Institute. Every year that economic think tank compiles a “best-performing cities” report measuring hiring, job growth, salaries and other economic performance. This year’s report concludes that things are actually worsening in Spokane or at least responding much more slowly than in other cities – and not just compared to four years ago.

The annual “best-performing cities” list ranks Spokane as one of the “biggest decliners” overall, based mostly on measures from 2011. Spokane’s worst performance came on two yardsticks: job growth from 2010 to 2011, and wage growth in the same period. We finished 181st and 182nd out of 200 in those categories; overall, Spokane ranked 161st, falling from 80th in 2011.

As with any statistic, context is everything. Is Spokane actually worsening, or is it just not improving while other cities make more impressive gains? The report’s findings show a little of both: Employment in Spokane dropped very slightly from May 2011 to May 2012, the report said, while the big winners showed growth of several percentage points. A big weakness of the report is that it shows us more about where we were a year ago than it does where we are today; recent employment reports have been some of the strongest in years.

Now for a second report from the frontiers of gloom: A local blog, Spokane Economic and Demographic Data, delved recently into new data on jobs and the economy in Spokane and concluded that the glass is a lot more than half-empty.

The blog is an anonymous enterprise, and one that is more or less relentlessly ominous about Spokane’s economy, politics and media. But it uses a lot of data, and it shows its work – linking to the data it evaluates.

You can view it yourself at 01/19/spokane-area-economic-update- charts.

Its recent report – looking at employment by sector, airline passengers, WSU enrollment, convention business and other factors – concludes that Spokane, as opposed to recovering, may have finally touched bottom, where it is stagnating.

“The data is what it is,” the blog’s author wrote. “And it’s damn ugly.”

A few examples:

• Spokane County’s unemployment rate has been improving in recent months, dropping below 8 percent for the first time in four years. But the author argues that the overwhelming picture of employment in Spokane is flat. Comparing 2005 and 2012, the federal Bureau of Labor Statistics shows that total nonfarm employment in Spokane County remains far behind 2008’s levels. In fact, 2012 employment is very, very close, month to month, to 2005. This includes November 2012, which was exactly the same as November 2005, with nonfarm employment at 211,800.

• The health care sector of the economy is “shedding jobs,” down by about 500 positions in the last four years. That follows years of rapid growth in that field. Manufacturing shows a slight uptick – but placed in a long-term historical context, it’s a blip. Overall, that historical context is the bane of many of these recent numbers – because the progress is so small set against how far we have to go.

• One “proxy measure” of the local economy’s strength is airline passengers. How many people fly in and out of town? In years past, airport officials have boasted that rising passenger numbers reflect Spokane’s economic strength. But passenger numbers are down in recent years – they dropped 1.8 percent in November 2012 from the previous year.

• The signs of life in the real estate market are similarly feeble, according to the author. The total number of homes sold in Spokane is “rumbling along at year 2000 levels” and in the Spokane Valley sales are at 2001 levels, according to statistics.

It’s not all ugly, of course. The glimmers of hope, the inches of progress, are real. Focusing solely on the downside is no way to get a full picture of the region’s economy. But as the naysayers remind us, neither is focusing only on the upside.

Shawn Vestal can be reached at (509) 459-5431 or Follow him on Twitter at @vestal13.

There are 23 comments on this story »