Spokane Economic Indicators Update


The State’s “adjusted” numbers through October show a sizable increase in local employment, which if real, is good.

The State’s local labor economist says its due to private sector job growth – but then cites construction projects done for the government as examples of private sector job growth, and  leaves out the SIA snow equipment building, the Felts airport paving, north side freeway construction and so on. Is it really private sector job growth when the work is  funded by the government? Per GSI’s  local economic status reported by Avista economist Grant Forsyth, government accounts for 55% of the $s spent on permitted construction in 2012. About half of Spokane’s economic activity comes directly or indirectly from the government.

Here’s the US Bureau of Labor Statistics “raw” data for Spokane County prior to adjustment, and only through September (October raw data not yet available).  Prior to “local adjustment” the BLS trend line is still going down:

More on Unemployment, Avista’s review of the local economy, and Airport trends.

Unemployment Rate

I ignore the official “unemployment rate” as it no longer makes any sense. You can see that whenever the number of people employed falls, the size of the labor force falls simultaneously. The unemployment rate is the difference between the labor force and the total employed. In Spokane, when people become unemployed they are instantly vaporized and no longer part of the labor force. When they find a job they are instantly reconstituted into real beings again and added to the count. Makes no sense to me to I ignore the unemployment rate.

Local Area Income and Retail Sales Spending

The following is from Dr. Grant Forsyth’s presentation on the state of the area economy presented at Greater Spokane Inc’s annual fall event.

Household median income is down -9% from the peak in 2004 (appears to be inflation adjusted to year 2005 dollars).

Taxable sales per home have fallen -20% from the peak in 2007. That is a painful drop that hurts local retailers.


Avista is the local gas and electric utility company. Their revenue and profits are driven by local economic growth and their ability to raise rates. Avista has announced earning are down by -46% and is offering a “buy out” to about 900 of 1,500 employees.

Avista’s results are, in part, a reflection of the local economic situation in the Spokane region as the utility arm operates as a regulated monopoly.

Empty buildings do not consume as much electricity and natural gas as occupied buildings in a thriving economy.

Local Airport Traffic

Passenger counts act as a proxy measure of the local economy. Passengers in/out of Spokane have been flat for almost two decades and are at their lowest point in 17 years and continue to decline. This proxy measure is similar to the comments of a local economist who says that Spokane has not seen a recovery from the deep 2008 economic recession while other areas of the state are seeing  growth. (Data is only current up through the summer as the airport board has not made any data updates since then.)

Air traffic operations (take offs and landings) at Felts Field have largely crashed and burned. SIA-based Spokane Airways, founded in the 1930s, and which had the last remaining public general aviation airplane flight instruction program and the last remaining rental airplanes in Spokane County, is going out of business. Meanwhile, the government is spending $5.4 million on lots of new concrete at Felts. In Spokane, when in doubt, pour more concrete – that’ll fix things!

Air cargo is up, but alas, this is reportedly due to more shipments being sorted and transferred to other planes – its not cargo originating or arriving in Spokane.


  • The State’s adjusted numbers show employment gains but the BLS raw data still shows a downward trend that has not yet bottomed.
  • Local household income and spending has fallen sharply in the downturn and not yet bottomed.
  • Airport activity continues to fall.
  • The local utility reports a sharp drop in profits.

Overall, Spokane’s local economy remains stuck. Meanwhile, the rest of the state has been growing for quite some time (Total non farm employment for Washington State):


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