So much about the economy is unsettling right now. Inflation is still a monster, unemployment is low but help wanted signs are everywhere, and major banks are failing. What in the world is going on?
Here are Five Fast Facts about Washington’s economic situation:
- 👎 Not The Fourth You Want - WalletHub recently ranked Washington state’s unemployment rate as the fourth worst in the nation. While most of the country has super low unemployment, ours actually went up by 1% in the last month…and over 9% in the last year. Let’s send that one back and try again, no?
- 🪓 Big Tech = Big Layoffs - Leading the downward spiral is Big Tech, which of course has a huge presence here. Microsoft, Amazon, and Facebook have all laid off thousands of workers since January. So much for those huge pandemic hiring and expansion binges.
- ☁️ Cloudy Future - While this year is still expected to get healthy tax revenue, the next few years look pretty bleak. Projections show about half a billion dollars per year less coming in for the next four years. Small businesses in particular are very concerned about what’s ahead. If they’ve survived this long, they’ve undoubtedly had financial trauma of some kind!
- 📈 Not To Be Deterred - Despite all this uncertainty, the Washington legislature and Gov. Inslee are planning to spend their way to prosperity. No, we’re not joking. The new budget calls for $70 billion for the next two years, up from $59 billion. The money is being spent on…well, pretty much everything.
- 🏘️ Coming Home…Or Not - One of the biggest chunks of that budget money ($4 billion) is for housing. You can see why that might be the case, since people can’t afford to live in WA cities. In Seattle, for example, the average hourly salary is $24, but you need at least double that to afford an apartment in the city. People earning $100k (over half the workers in the area) can’t buy a house. How about we don’t follow in San Fran’s footsteps with the “housing” on the streets?
🔥Bottom line: What we have here is a multi-layered problem. There’s a shortage of housing, which drives up the price. That makes cities more expensive, meaning people need better jobs. At the same time, big companies are laying off huge numbers of the jobs that do exist. These things lead to lower tax revenues, and in turn incentives to bring businesses (and jobs) in. Rinse and repeat. It’s all bad for your Paychecks, unfortunately.
Is this big spending budget the right thing to bring jobs back and position Washington for success? We’re not convinced. What do you think?
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