Decade in review: Economic, business recovery in Spokane
At the beginning of the decade, the Spokane region was recovering from the Great Recession. The county’s unemployment rate was in the double-digits and home sales were slow amid economic uncertainty.
But the region has since seen gains in employment, wages, population and housing as the U.S. economy grew for 121 continuous months beginning in June 2009, marking the longest expansion – or period of economic growth – in history.
“The thing that has helped us is the length of the expansion,” said Grant Forsyth, chief economist for Avista Corp. “The U.S. expansion has been weighted to a few regions and, certainly, the West has been one of those. We have been seeing a lot of in-migration to the Pacific Northwest, and it will be interesting to see if that pace continues in the next decade.”
Real estate rebound
Home sales were depressed by the effects of a record number of foreclosures and high unemployment at the beginning of the decade. Housing inventory was at a 10-month supply. A healthy housing market typically contains a six-month supply of homes.
The housing market in Spokane hit rock bottom in 2011.
“We sold fewer homes in 2011 in Spokane than we did 25 years earlier in 1987,” said Rob Higgins, executive director for the Spokane Association of Realtors. “That was the low point over a 25-year period.”
But the housing market began rebounding. By December 2014, more than 1,878 properties were on the market, representing a three-month supply. The median home price was $168,000 – a 2% increase over the prior year.
Since then, Spokane has become one of the hottest real estate markets in the nation, primarily fueled by population and job growth. It’s a seller’s market with multiple offers, low inventory and rising prices.
The median closing price was $260,000 in November, with a a 1.2-month supply of homes on the market in Spokane County.
Post-recession job gains
Spokane County began the decade with a 10.6% unemployment rate in January 2010, shedding more than 9,500 jobs compared with a year prior.
As the economy improved, the county’s job growth was led by the health care sector, which has experienced a 24% gain in jobs since 2009, Forsyth said.
Spokane’s recovery also was led by job gains in advanced manufacturing, finance/insurance, transportation/warehousing and education. The region has added 38,000 jobs since the first half of 2009.
The construction industry, which was hit hard by the Great Recession, improved during the decade to become the third-fastest-growing construction job market in the nation during the year ending in May, according to the Associated General Contractors of America.
Construction employment in the Spokane-Spokane Valley area expanded from a post-recession low of 10,100 employees in May 2011 to 17,250 in May 2019, according to data from the U.S Bureau of Labor Statistics.
Business on the West Plains
The decade brought many changes to the West Plains.
City, county and airport officials created the West Plains Public Development Authority in 2017 to align resources toward a common goal of creating a manufacturing and aerospace hub.
Amazon’s proposed $181 million fulfillment center is a direct result of the West Plains PDA collaboration. The project, announced in 2018, will bring more than 1,500 jobs to the area and is slated for completion by mid-2020.
Aerospace manufacturer Exotic Metals is building a manufacturing facility in Airway Heights, and California-based Mullen Technologies announced plans in April to build and lease a 1.3-million-square-foot manufacturing space that is expected to bring more than 860 jobs to the area related to assembly of the Qiantu K50 electric sports car. The Mullen site also would house research and development facilities for lithium-ion batteries.
The proposed facility on the West Plains could eventually expand to create an “energy business park” with potential for 10,000 jobs, some of which are engineering positions that would pay upward of $100,000 a year.
Kenworth Sales Co. and Selkirk Pharma are also planning to open manufacturing facilities on the West Plains.
Fairchild Air Force Base, the region’s largest employer, is adding hundreds of airmen to support and fly KC-135 refueling tankers that will be based there.
Spokane International Airport is building a transload facility to transfer shipments from trucks to rail and vice versa to attract more manufacturing and aerospace companies to the area. The transload facility could strengthen a future pitch to have Boeing operate a manufacturing facility on the West Plains.
Casinos in Airway Heights
Gov. Jay Inslee approved the Spokane Tribe’s proposal in 2016 to build a $400 million gaming and retail development on the West Plains. The governor’s approval followed years of opposition from business and county leaders and the Kalispel Tribe, which operates nearby Northern Quest Resort & Casino in Airway Heights.
The Spokane Tribe opened the casino in 2018 and plans to expand the complex to include a hotel, cultural center, entertainment venue and retail shops on a 145-acre site.
Northern Quest underwent a large expansion project in 2018 that added a retail store, movie and dinner theater, arcade and entertainment center for children. The Kalispel Tribe opened a $26 million apartment complex and a $14 million luxury RV resort in 2019.
Bank acquisitions
The trend of consolidation and mergers in the nation’s banking industry was mirrored locally, as several Spokane-based banks were acquired during the past 10 years.
In 2014, Portland-based Umpqua bank acquired Sterling Savings Bank – a Spokane-based publicly traded financial institution.
State regulators in 2011 closed Colfax-based Bank of Whitman, which had a large presence in Spokane. Its assets were purchased by Tacoma-based Columbia Bank.
Additionally, Montana-based First Interstate BancSystem purchased Inland Northwest Bank’s parent company, Northwest Bancorp, in a $160.9 million stock deal in 2018. INB’s branches in Washington, Idaho and Oregon were branded to First Interstate Bank.
Startup expansion
Spokane’s strong job market, workforce, low cost of operations and livability all contributed to startup growth in the region.
The Spokane region is home to Etailz and Stay Alfred, among other startups that have garnered national recognition.
Seattle-based startups have also seen the value of relocating to Spokane.
Seattle-based Rover, a dogsitting and walking startup, opened a second office in Spokane in 2017. Remitly, a Seattle-based online international money transfer company, announced plans earlier this year to open a second office in Spokane.
StartUp Spokane, a program of Greater Spokane Incorporated, launched in 2015 to provide coworking space, one-on-one entrepreneurship assistance as well as educational and networking events. Elsewhere, the University of Washington’s CoMotion Labs opened a virtual lab in 2017 in Spokane that provides entrepreneurs with programming, mentoring and advising.