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| ECONOMIC BASE |
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Economic Base Summary: Spokane, as the economic center of the Inland Northwest, developed as a service center for the growing natural resource industries that flourished in the area in the 1900s. The area’s economy slowed with the erosion in those base industries, beginning in the early 1980s. The economy rebounded by the end of the decade, bolstered by an in-migration of both businesses and individuals. The influx of new residents expanded the availability of new workers in the area’s work force as it experienced steady growth in the 1990s. Growth in the 1990's - Recession in early 2000's: During the 1990's, the county’s labor force and total employment each grew by 22%. In contrast, in the three years since 2000, the labor force has grown by 1.3%. Total employment increased only slightly, by 0.3%, and the unemployment rate climbed to 6.6% as the area’s economy stumbled in response to the national recession. Areas of Economy: As a regional trade and service center, those sectors have become dominant in the county’s economy, accounting for well over 60% of non-agricultural jobs. Wholesale and retail trade and associated trucking and warehousing make up nearly 20% of non-agricultural employment, and services as a whole account for nearly 31% of the total. - Government, leisure and hospitality, manufacturing, and financial activities contribute heavily to non-agricultural employment.
- Federal, state, and local government employment accounts for over 17% of non-farm jobs.
- Leisure and hospitality entities and manufacturers each make up approximately 9%, and financial activities account for nearly 7% of non-agricultural jobs.
Current Decline in Manufacturing: Although manufacturing traditionally has contributed significantly to area employment and payrolls, its influence is declining. The number of employees in those base industries grew steadily through the 1980s into the 1990s, when employment peaked at 22,300 jobs in 1997, accounting for 12% of the nonagricultural employment base. The number of manufacturing jobs has since waned with decreases in primary metals with the closure of the Kaiser-Mead smelter and reductions at the Kaiser-Trentwood rolling mill. The electronics manufacturing sector has been hard hit with the national recession in the high-tech and telecommunications industry. Further reduction in the electronics product sector is expected as additional production jobs are transferred to off-shore facilities. - Even as employment in several manufacturing sectors, such as engine remanufacturing, expanded over the past several years, the total number of manufacturing jobs decreased by ¼ from its peak level in 1997 to the 17,000 manufacturing jobs in 2003.
- Growth in nonagricultural employment is predicted to be moderate over the next decade at an annual average rate of 1.2%. The highest rate of growth is predicted to be 2.4% in the services sector.
- Manufacturing is expected to experience the lowest growth rate of any of the other employment sectors. The list of major employers in Spokane County substantiates the dominance of federal, state, and local government, educational agencies, and services in the economic base.
The Role of Fairchild Air Force Base: While it is not unusual to find school related employment in the top 10 employers in many communities, the nature of government employment in Spokane is different, due primarily to the contribution of Fairchild Air Force Base. Much of the housing for those stationed or working at Fairchild is off-base in the greater Spokane area. It is also common for service retirees to relocate in Spokane after their service commitment is fulfilled. Like all other bases across the country, the Base Closure Commission is evaluating Fairchild and its mission for possible expansion or for closure. - Local individuals close to the process believe that expansion is the most likely outcome, which would expand Fairchild’s impact on the community in the future.
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