Spokane ranks 53d out of 59 Washington cities for income

Washington’s richest — and poorest — cities – seattlepi.com.

In a ranking of Washington cities by median family income, Spokane ranks 53d lowest out of 59 cities and that is really sad for the State’s 2nd largest city.

Unless you work for the local government where pay outpaces the local median.

Previous: Comparison of Spokane versus King County wages

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Where does Spokane area personal income come from?

Indicators Northwest. Great web site for data.

22% of Spokane area personal income is transfer payments, as noted on this web site before. These charts help to see the differences between Spokane a few other counties in Washington. Transfer payments represent a significantly larger part of Spokane area incomes than in other large counties with transfer payments running 50% to 100% higher in Spokane. The growth rate in Spokane has also been very rapid.

Transfer payments are payments made without any contemporary service or product provided. For example, pensions, unemployment, disability and other benefits programs, primarily funded by taxpayers.

No information is provided here on how the transfer payments are allocated between pensions, disability, unemployment and so on. A guess is that Spokane has become a retirement center, where wage income is a diminishing portion of local income.

Of interest, a typical government employee, at retirement, receives a pension that is roughly equivalent to an annuity having $1 to $2 million value, depending on their wages while working. Stated another way, a private sector worker would have to save $1 to $2 million of their own money, by the start of their retirement.

How do Spokane household incomes compare to other Washington Counties?

Charts are from IndicatorsNorthwest.org.

The following charts show inflation adjusted median household income from the late 1980s to 2009. Residents of Spokane and much of the United States are no better off today than they were in the late 1980s.

Spokane is the blue line at the bottom of the chart. Lower is bad.  Spokane is well below the median for Washington and the median for the United States.

King County is the top line. Higher is good.

What was going on in Benton County in the late 1980s?

Spokane, King County and Washington inflation adjusted household median income charts

A reader who also needs to be anonymous, has provided an additional chart comparing Spokane County, King County and the state of Washington household median incomes, adjusted for inflation. The results are similar to those posted last week, but these show Washington and King County falling backwards in income over the period 1992-2009.

The lines to compare in this chart are purple to green to red:

The above charts are for the period 1992-2009, while the chart I provided last week is for the period 1989-2010.

For the period 1992 to 2009, all areas show declines in median income.

Differences between this chart and my Spokane County median income chart may be due to differing reporting periods, different data sources (see “After the break”, below) and CPI adjustments. Between 1989 to 1992, Spokane County after inflation adjusted median income rose by 1.4%. From 2009 to 2010, Spokane County median incomes fell an additional 2.75%, which is not reflected in the above chart ending in 2009.

The main takeaway is that after inflation adjusted median incomes have not done well over two decades. The median income is the value at which half of incomes are less and half are greater. This is not the same as average income.

Data and more commentary for the above chart are after the break.

Read more of this post

Spokane Median Income Trend versus State of Washington Median Income Trend

This chart shows Spokane median household incomes versus the state of Washington’s household median income, with both adjusted for inflation in to 2010 $s.

  • Compare the red line with the green line. Green is the State of Washington and red is Spokane.
  • Compare the yellow/orange line with the blue line, where yellow/orange is the state of Washington and the blue line is Spokane.

If the data series are correct, and the inflation adjustments are correct, household median income in Washington has also fallen but remains just above the 1989 figure.

Data sources – see previous post.

I have government data for average wages per job (which is not the same as household median income). I have not yet had time to make the inflation adjustments to that data, and draw a chart, but it appears that average wages per job have gone up, which is good news.

Update: Funny quote from Taleb, paraphrasing McCluhan… “The median is not the message“. We hope!

Spokane’s Median Household Income Trend

Previously, we looked at Spokane median income versus the state and nation and found that while incomes have gone up, they have gone up at half the rate of the rest of the state.

I recently had to make some inflation adjustments to some data.  I was curious as to what these adjustments would do for the historical Spokane median income.  The red line is median household income, after adjusting to 2010 levels (in other words, adjusting for inflation).

Data: The median income data comes from the Washington (State) Office of Financial Management. The historical median incomes were adjusted for inflation using the U.S. Bureau of Labor Statistics Inflation Calculator.

Compare the above historical trend with that for the U.S. household median income – in other words, the whole country:(Background on the above chart is here. The data source is different and perhaps it should not be directly compared to the Spokane chart.)

Update: I have since drawn a chart for the State of Washington, as a whole. This too shows a sharp drop in median income, although not quite as far – this will be posted soon. I also sampled some BEA data on average wages per job and adjusted those for inflation. The inflation adjusted average wage per job appears to have risen over this period, while the household median income went down. While househould median income and average wage per job are not the same thing, I do not know why would go down while the other goes up. Perhaps there is a mistake in the data, the inflation adjustment, or something else. When I have time, I will post additional charts on these topics. For now, I’ve deleted the post-title “The Shocking Truth”.

My jaw dropped when I saw this. This is shocking, frightening and revealing.  After inflation, as U.S. median incomes have risen, Spokane area median incomes have fallen – apparently – to 1980s levels or lower. I hope that this is all wrong and I have made mistakes.  I have provided the data tables and the data sources for others to review.

The Spokane cost of living has not been going down. In the State of Washington, and at the local level, government’s are now increasing fees and tuition costs sharply. At the Federal level, taxes are likely to climb, perhaps significantly to deal with the budget blowout.

All told, Spokane residents fall further and further behind, year over year, decade over decade. This is an absolute disaster. But no one around here gives a damn.

Oh hell, let’s go pour more concrete. That’ll surely fix the problems.

Read more of this post

Spokane Median Income Growth Rate

Newly updated.

The next chart shows Spokane’s median income  versus the median income for the state of Washington through 2010. Spokane median income runs about 80% of that at the State level and has fallen further and further behind since the 1970s. Specifically,the statewide median incomes grows 2 times faster than the median income in Spokane.

Washington State now ranks 8th in the nation for wage income growth, which apparently comes mostly from the west side of the state – where unemployment went down, unlike in Spokane where May unemployment became worse.

As shown below, Spokane has unfortunately been diverging further and further from the State’s median income.

The data comes from the Office of Financial Management.

As shown previously, transfer payments income into Spokane has gone up – sharply – although, per the previous article, nationally, transfer income has fallen in the first quarter of 2011. First quarter data is not available for Spokane.

Data comes from washington.reaproject.org

Note that transfer payments historically rise at the start of recessions. See 1973-1974, the early 80s, and then early 90s.  Note how each time, the transfer payments dropped as the recession faded away.

Now look at 2001 – they never dropped afterwards here in Spokane. Then look at 2008 onwards. Will this drop when this recession recedes? With the loss of much industry here, I suspect many took involuntary early retirement (retirement benefits can be a source of transfer payments).  This may be a semi-permanent upwards spike, as in 2001, from which the Spokane economy does not readily improve.

Spokane County income charts

Spokane County per capita income versus that of Washington and the U.S. As indicated by the red line diverging further from the green and blue lines, Spokane County has been gradually falling further and further behind the income growth of the state and the country.

The divergence between Spokane County per capita income and the State has been getting wider over the past 30 years and is now twice as much as 30 years ago.

Spokane area per capita income growth in the 2000-2009 decade has been awful except for a brief spike around 2006. My belief is that Spokane never recovered from the 2001 recession based on this chart, the diverging income chart and that unlike past recessions, when the transfer payments spiked up in 2000/2001, they did not fall back down as they had done during previous recessions.

Spokane Income Growth Lags the State

The chart supports my hypothesis from last week – Spokane growth is lagging behind elsewhere. Wage earners in Spokane are falling further and further behind the rest of the state, and also the nation (not shown).

From the slope of the two trend lines, WA state income growth is growing twice as fast as income growth in Spokane.

Source: http://www.communityindicators.ewu.edu/graph.cfm?id=88

Why the spike in Spokane incomes in 2009? Possibly due to the layoffs of lower paid workers leaving us with more higher paid workers. Keep in mind that almost 10% of local jobs disappeared during this recession. The jobs lost were not high paid health care or good paying government jobs. Laying off lower paid workers causes the average and median wages for the area to move higher. This is not a sustainable way of increasing average and median incomes in the area!

Trend in per capita income, Spokane County 1969 to 2008

The following chart compares the per capita income in Spokane County to the per capita income average of the United States and the average for the State of Washington. The trend, over time, is for Spokane County per capita incomes to drop relative to earnings elsewhere in Washington and the United States.

The data is from the Washington Regional Economic Analysis Project, Selected Economic Indicators “Per Capita Income” table.

The trend is unfortunate and I am hoping that some how I am misinterpreting the data table. Please leave a comment if this is not right – I am reading the percentages directly out of the WREAP table. The last few years do agree with other data on average wages in Spokane versus the State.

Note that over the entire period, per capita income has gone up. Presumably, the interpretation is that Spokane incomes have not gone up as fast as else where in the State or the U.S.

In the chart below, the lag in Spokane incomes is apparent. The bottom (dark red) line is Spokane and note that over time, it falls further behind the expansion of wages in Washington (green) and the U.s. (dark blue). An eyeball (not statistical) interpretation of the chart indicates wages began diverging in about 1995.

I did some comparisons with selected locations elsewhere in Washington and  their incomes rose faster than those in Spokane.

Source: Community Indicators.

Spokane median income falls to 2003 levels

US real median household income 1967 - 2008

Image via Wikipedia

Year   Median Income Level

2003   42,144
2004   44,452
2005   44,176
2006   45,088
2007   44,416
2008   43,483
2009   42,196

Source: Income Estimates by County: 1989 to 2008 and Projection for 2009, Office of Financial Management, State of Washington.

Spokane Per Capita Income Declined in 2009

The Great Northern Railway Depot clock tower a...

Image via Wikipedia

Link to report: Spokane Community Indicators.

But realistically, per capita income has declined across much of the country in 2009, and generally declined more than in Spokane.  Spokane’s government and health care dominated economy makes it somewhat immune to the real economy.

Much of this is due to large income gains in health care of about 10.8%, and 5.7% in government (local, state, and federal). But because of a large drop in manufacturing incomes – almost 14% – as well as smaller but significant decreases in Retail Trade (-4.6%), Finance and Insurance (-3.7%), and Professional, Scientific, and Technical Services (-2.9%), those other gains were not large enough to offset the increase in population. That is why we saw a decrease.

And once again – if you do not work in government/education or health care, Spokane is probably not your best choice for career options.

Income versus test scores

A comparison of income versus test scores for two elementary schools in Spokane:  Blogs – The great educational-income divide.

Spokane Incomes Compared to Similar Cities

The following chart is courtesy of the City of Boise. Cities generally pick similar sized cities to compare their own city’s economy. Spokane picks Boise as a comparable city, and Boise picks Spokane as comparable, therefore, the following data is relevant:

Some newer data might be the following from 2008 (but source not yet verified):

  • 2008 Spokane median household income: $41,588
  • 2008 Washington state median household income: $58,078

On a statewide basis, the average Spokane household income is 28% lower than that for Washington State.

What This Means
In Spokane, most government, health care and education workers earn salaries similar to those in more expensive cities on the west side of the state.

Most other workers, however, earn substantially less.

Spokane’s workforce seems split in to two worker classes – those in the core group of government, health care and education – and everyone else.

Read more of this post

Spokane Income Distribution

Charts from City-Data.Com showing household income distribution and home values distribution for 2008.

Spokane:

Seattle:

Keep in mind – home prices are a proxy for the typical incomes in an area, and vice versa.

Spokane Per Capita Income Compared to Washington State

Source of chart: http://www.workforceexplorer.com/admin/uploadedPublications/9313_ChartBook2008_Wex.pdf

Spokane is known for its inexpensive housing costs. Unfortunately, housing costs are a proxy for average wages in the area – in other words, wages, like housing, are low compared to major cities. As can be seen in the Household Income chart, below, Spokane household income is approximately 30% less than the Washington State average. Considering that within Spokane, 37.7% of all jobs are government, health care or education, which are generally on par with the state average, this implies that the rest of the jobs have much lower wages. As shown in a separate post on this site, software programmers in Spokane earn 38% less than their counterparts in Seattle.

This chart, from Trulia.com, shows similar values but for a more recent year, than above:


“The X Report”

A review of some “big picture” economic indicators for the Spokane area.

Spokane Airport passenger usage remains weak – now less than in 1995.

chart_1 (1)

We call this “growth”, of course. (See the Comments to this post to see how a rise in passenger use was called a positive economic indicator by local promoters in 2001, 2005 and 2006 but when passenger levels declined they now pretend passenger usage no longer matters. Right.)

Felts Field air operations fell off a cliff:

chart_2 (2)

Total air operations in the area have collapsed (but local political leaders refer to this as “continued growth of aviation!” – may be if we turn the chart upside down!)

CombinedSIAFeltsAllOps-3Non-stop year-round destination cities have declined from 18 to 11 (including the subsidized daily flight to Los Angeles).

The rate of growth in jobs (for the entire County) has slowed. The area is no longer producing jobs at the same rate as natural population growth (from births and inbound migration, over time). That means the population is getting larger but the number of jobs is not keeping up. Here’s a chart highlighting the slow down in job growth:

SpokaneCountyJobGrowthRateSlowing

Spokane County non-farm jobs trend – mostly flat since 1998.

2013JanBLSTotalEmployed

City of Spokane jobs have been going down for about two decades – there is no increase in net jobs since the mid 1990s.

Can you spot the increase in jobs created by the Convention Center expansions? The total number of jobs in the City of Spokane has continued to fall, even after passing their expansion initiatives. (Chart from US BLS, updated to early 2014.) The City of Spokane has flat lined. 

LAUCT536700000000005_742370_1398301192417

Unfortunately, Spokane was ranked as the worst metro area out of 100 for job growth in a 2012 poll.

While the United States has recovered nearly all jobs lost since the 2008 downturn, and Washington State has recovered more than all the jobs lost since the downturn, Spokane County has recovered about half the jobs lost. Here are the charts for the U.S. as a whole, the State of Washington, and then Spokane County.

(At the end of 2014, there are some indications that the US economy may be headed into a slowdown. If this happens, the effects on Spokane would be bad, very bad, as Spokane has not yet fully recovered from the 2008 downturn.) (deleted as the economic situation seems to have stabilized since that was written)

Specifically:

  • US jobs regained – about 100%
  • WA jobs regained – more than 100%
  • Spokane County jobs regained: 52% using seasonally adjusted totals, or 44% using non seasonally adjusted data

United States

(From US BLS)

CES0000000001_729328_1398279732234

Washington State

SMS53000000000000001_729393_1398279809663

Spokane County

SMS53440600000000001_729435_1398279884691

Median Family Income Compared to Other Washington Cities

Spokane’s economic situation is not good: Spokane ranks 53d out of 59 Washington cities for median family income

Spokane’s Housing Stock is Old – Highlighting the Limited Economic Growth in the Area

Growing cities, with growing economies, show newer housing – Spokane has a stock of old housing, indicating low growth. The boom years are obvious in this chart – 20% of homes here were built in 1900-1919 (mining boom), and 31% in 1940-1959  (aluminum processing boom, post World War II growth of families):

app

Here is a typical growing city housing age pattern (in this example, Olympia, WA) – in a modern, growing city, you can see that more homes are built to meet the demand of contemporary growth.

app

Spokane has essentially no growth and hence, very little new home construction compared to thriving cities. More example cities are here.

Home Sales

Chart of the number of home sales from 2000 to 2014 (only through spring as this chart is slightly out of date):

image The original chart for the above (from Trulia.com) used a logarithmic scale for the Y-Axis which makes the peaks and valleys nearly flat.  A software tool was used to convert the log scale chart into a linearly scaled Y-Axis to show the trend in a format that most readers understand.

The next chart shows that median sales prices are basically flat since 2006.

Spokane-Median

Income and spending lag:

This chart shows how taxable spending per household has trended downwards in the past decade. The data for this chart is based on retail sales taxes collected through 2011. Since then (not shown in chart), retails sales have begun to grow again.

The blue line shows real median household income while the red line is an indicator of spending per household.

SpokaneMedianHouseholdIncome

Per Capita Income Trend Is Downwards

This chart has not been updated since 2008 but per WSU’s CORE research report, current per capita income is at 2007 levels. Per capita income is continuing to sink over the long term, relative to elsewhere. The lines in this chart indicate Spokane per capita income as a percent of the average per capita income in the state of Washington (red) and the U.S. as a whole (blue). Over time, the per capita income in Spokane, relative to everywhere else, goes down. Note that GSI will be happy to show you a chart of rising per capita income in the area – their chart is true too. But the problem is that Spokane incomes rise much slower than elsewhere such that over time, Spokane residents fall further and further behind the rest of the state and the country.

The Spokane County GDP per capita is unchanged from 2001 through 2011 (see bottom line in chart) – in other worlds, flat lined, like Convention Center attendance (well, not quite the same – the PFD’s facility usage actually went down over this period):

GDPPerCapita

A chart of pay in Spokane County versus King County

Attracting high skilled talent for high paying job categories is tough due to the large difference in pay between Spokane and the other big city in Washington:

SpokaneVsKing

The next chart has not been updated but the trend remains the same today. Incomes in the rest of the state climb twice as fast as those in Spokane.  The blue line represents the rate of increase in Washington State; the red line is the rate of increase in Spokane County. Over 30 years, Spokane pay is falling further and further behind the rest of the state.

SpokaneBirthsByMedicaid

Transfer payments are now about 23% of area personal income.

Transfer payments are primarily Federal payments made without a contemporary service or product delivered in return. Examples include disability payments, unemployment compensation, Medicare/Medicaid payments, government pensions and other government benefit programs. In other words, almost $1 out of every $4 here is government payouts, not earnings from contemporary work. The problem is not that there are transfer payments – the problem is that the steady growth in transfer payments is not sustainable.

Spokane’s Heavily Subsidized Economy

The primary purpose of the Spokane Public Facilities District, like nearly all municipal convention centers, is to provide a tax subsidy to the local hotel and restaurant industry. This use of publicly funded convention centers as a hidden subsidy of local hotels is widely documented in the convention center industry literature. In Spokane, it is codified – one member of the five member Board of the Spokane PFD is required to be someone working in the hotel industry. There is no requirement that, say, the PFD Board include a member of the general public to represent the interests of Spokane residents and taxpayers (the peons do not rank in this community).

The long vacant Ridpath Hotel may get re-opened and turned into downtown condos some day. But only with substantial tax subsides. About 1/4th of the cost is proposed to be funded by tax credits issued after declaring the not very old hotel as a historic building.  The city is also proposing to give Federal Housing and Urban Development grants to the developer. More taxpayer subsidies for downtown.

The proposed Spokane Field House in downtown is an extension of the PFD’s subsidy program to local hotels. Taxpayers will fund a downtown sports complex with the goal of bringing in some outside visitors to fill downtown hotels and restaurants. This is an indirect subsidy to Walt Worthy’s “convention center” hotel across the street.

Indeed, the PFD’s own economic study shows who actually benefits – and its hotels and restaurants:

WhoBenefits

The sad thing about all these subsidies to the hotel industry is that they do not actually work.

Here is a chart of hospitality industry jobs in Spokane County.  After THREE expansions of the Convention Center, we have fewer jobs in the hotel industry than we did in 1999 when we first began expanding the Convention Center!

Hospitality industry employment chart from the US BLS from 1993 to 2014:

SMU53440607000000001_730618_1398282555622

The downtown meme of ever expanding public facilities and more subsidies turns out not to have met the original claims for increasing jobs. Today we have fewer hotel jobs and fewer overall jobs in the City of Spokane than before the expansion. Expanding the Convention Center has resulted in FEWER JOBS.

Nothing happens in Spokane unless the local oligarchs are subsidized by the taxpayers. This is a form of transfer payments from poor people to developers.

Now we hang our hat on future medical school with an exaggerated economic benefit calculation  (local promoters nationwide engage in absurd and inflated exaggerations of all economic studies – most of these studies are not worth the digital ink they’ve spilled – same for Spokane). And of course, salvation will come with a heated pedestrian bike bridge!

Spokane needs real industry, designing and building products. From insect traps to pharmaceutical manufacturing to perhaps restoration of the lost high tech manufacturing sector, these are the sectors that generate real growth and jobs. But we just keep subsidizing downtown businesses that fail to deliver on their promises. Always have, and always will. Consequently, Spokane is going no where – the trends all remain negative (see charts above).

The Primary Economic Cluster in Spokane is Land Development

The primary economic cluster of Spokane is manipulating government so land speculators can profit. Here is a quote from Bob Herold of the Inlander:

“Well, I’ve learned that in Spokane, economic development most often begins and ends with making a profit off land speculation. It’s a cultural thing, and government’s job here is to help make the speculation pay off.”

And this business model works well for those who have influence. The largest media operator is one of the largest landowners in the region and has a long history of using their media influence to push government programs that benefit the owners (see The Fancher Report, the non-fiction novel Breaking Blue, or this blog for examples).

Contemporary examples include:  repeated Convention Center expansions (and their inability to meet any objectives) the “grand iconic unique in the world (except its notheated pedestrian/bike bridge, a proposed downtown “trolley” to benefit downtown, the “growing University District” (whose numbers show no growth) and the past and future for a light rail line that passes by the oligarchs’ properties runs from the underused airport to downtown and then to Liberty Lake (remember the two votes on that last decade?)

Update: Another economic cluster is government funded torture research hidden away in our small town. It’s a big industry in Spokane. Really big.

Crime

We cannot draw an accurate long term crime trend chart because of changes made in the reporting system last decade that resulted in a drop in crime reports. We’ll leave this topic with this chart – in 2011 and 2010, the auto theft rate in Spokane was the 4th highest in the nation but dropped in 2012 to 9th place:

image004

Accountability

A related crime problem is the culture and general corruption of the police in Spokane.  A week hardly goes by without yet another police scandal – from having sex on duty to running steroids and drugs to shooting people in the back of the head to killing Otto Zehm. This is likely a symptom of the difficulty in attracting high quality, high performing individuals to Spokane. And that is not just a police problem but one that impacts a wide swath of organizations both public and private.

We end up with local organizations having the same leadership for a quarter century, a sure sign of stagnation. From head dog catcher to GSI to the PFD to the STA -while some organizations are effective, some are not – yet their leadership is held on forever. There is no accountability for the PFD’s failure (by the core metrics of attendees and local jobs) or GSI’s long term ineffectiveness (as seen in the overall local economy numbers).

Bad leaders come to Spokane to retire on the job. And no one cares. In fact, one Washington State labor economist concluded that Spokane attracts unemployed people 🙂

Mental Health

Youth suicide rate is 4 to 6 times greater than the State of Washington and Washington’s suicide rate is higher than the national rate.

SpoSuicides2005-2009Youth

How Bad is the Suicide Rate?

(There are counties, especially with high populations of native American populations living in poverty, such as in Alaska, where the suicide rates are much higher.)

Update July 5, 2018

Spokane depression rate higher than state, national averages according to a study by the Blue Cross Blue Shield Association.

For each successful suicide, there are 7 hospitalizations for attempted suicides, and 15 ER visits for suicide. There are even more cases of depression that result in 9-1-1 calls to the police (but which do not end up in an ER), and even more cases than that of people who never seek help. (Also see these youth suicide statistics). Multiplying that times the rates in the chart above yields a staggering number of severely depressed people in the area. Throw in the reports of bodies turning up in parks and rivers and you get the picture.

Nearby Kootenai County, Idaho has the 2nd highest rate of suicide in Idaho.

The Spokane Regional Health District says health is an indicator of the economy. This is an indicator of despair and hopelessness. And its off the radar as recommendations for reporters discourage reporting of suicides.

Related to the above, the annual days of sunshine in Spokane is on par with Seattle. But don’t tell that to the Spokane Visitors Bureau which believes Spokane has 260 days of clear skies per year!

Telling Outright Lies is the Local Pastime

A selection of prominent lies and the liars who tell them is listed here.

The basic culture of Spokane seems to be based on lies and deceit, causing the area to repeatedly earn a designation as the Scam and Fraud Capitol of America.

The Problem is Ignorance 

The long term trend in the Spokane area economy has been poor – its been treading water for 15 years.

In spite of much media PR puffery, people have a sense that things are bad. And the data confirm it is a bad situation.

Much of the local media act as cheerleaders, engage in “errors of omission” (a method of telling a lie which fits right into the local culture), and hide poor performance of elected and non-elected leaders. Failed leaders are not held accountable – instead, long term declining attendance at Spokane Public Facilities District is defended and actively covered up by the local newspaper. A decline in airport usage is called “continued growth” – and not one person in Spokane’s media even bats an eye at the egregious lie.  Visit Spokane claims it is nearly always clear and sunny in Spokane. A local promoter misquotes a tech industry publication to falsely claim Spokane is a high tech hot spot (when the publication actually said Spokane is NOT a high tech hot spot).

To this day, the Spokesman-Review is pained to present data in easy to understand charts, even when the State provides the charts for free. For example, here is the September 2014 employment chart and here is how they babbled on about this in words:

employment

The chart cannot be spun – Spokane has recovered about half of the jobs lost in the economic downturn while the State and the nation have recovered more than 100%. By hiding this from readers and viewers, Spokane’s local media censors the news through “lying by omission”.  Except for The Inlander, perhaps. (Note – former SR staffer Ryan Pitts left the SR to work on CensusReporter, a tool to make it easy for reporters to obtain Census data in easy to read charts. Tools exist. It’s not hard to illustrate stores with charts. But its hard to spin actual data.)

The outright lies and exaggerations are non-stop – hence, Spokane remains the scam and fraud capitol of America – but the zero credibility local media itself is complicit in re-telling and defending the lies (follow the links on this blog to see specific examples of the local media’s participation).

When land speculation is one of the top 3 industry clusters and the media is conflicted with land ownership and development,  reporting is warped.

The public has been intentionally kept in the dark as to the true state of Spokane – but many have seen these issues for a long time. Out of town visitors arrive and often the first thing they say is “Spokane looks like a run down dump” (check out the weeds growing out of the streets and sidewalks in August and you can see why).

This blog shed a light on the truth that has been hidden from the public – by showing the actual data, in simple to read charts, that directly contradict the local memes. Data is the enemy of propagandists in the local media.

The X Report

This site will remain on line as “The X Report“, just as “The Fancher Report” (summary here) lives on today, or how local corruption is documented in “Breaking Blue” or at Camus Magazine and other web sites.  It is no longer safe to publish skeptical inquiry on the Internet.

Before I moved to Spokane, an old friend who grew up here said, “X, Spokane is just a small town. Only bigger.”

Was not sure what he meant back then – but now I know: And he was right!

Nothing has changed in decades. Three decades of economic studies reached identical conclusions and were filed on dusty shelves never to be looked at again. Spokane remains behind the times, never reaching up to its potential as the 2nd largest city in Washington – but always hoping for an external savior (the current meme is the medical school brouhaha) to drop in and save the day. Before that it was regional health care. Before that Spokane was going to be an information technology center on par with Austin, Texas or may be even Silicon Valley. Before that it was going to be a manufacturing mecca. So we come up with an incoherent cluster strategy for economic growth.

But nothing has fundamentally changed. At this point, its down to more land speculation and more transfers to the oligarchs who will bleed the cash cow dry as long as they can keep it bleeding. And not one god damned local politician gives a hoot at the obvious decay and decline – they just continue to play along to earn bennies for themselves.

And because of that, this might be the very last post on this blog. The web site will stay online and be known as “The X Report”.

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This blog is taking a break. No idea if it will return. Hard to imagine but 1/4th of all the posts made on this web site were never published! There are nearly 200 posts sitting in draft form 🙂 They were not published for many reasons including timeliness (the information was useful for a limited time), insufficient time to complete the post, insufficient data, or for a few I feared I would be run out of town if I let them fly. Ouch!

Spokane Employment and Unemployment data

(This was first published on Dec 15, 2014, but later moved out of sequence, to this location on the blog.)

Spokane County total non-farm employment, as reported by the Washington ESD:

WAEmp

 

Chart 1

Total non-farm employment, as reported by the U.S. Bureau of Labor Statistics:

latest_numbers_SMU53440600000000001_2004_2014_all_period_M10_data-1

 Chart 2

The Washington ESD data is said to come from the BLS. However, a close inspection reveals a difference in the most recent data. By taking the WA ESD data and then subtracting the BLS data, we create a new table showing the difference in the values:

DeltaWAvsBLS

Table 1

As shown in the table, starting in late 2013, Washington ESD adjusts the BLS data upwards. In 2014, the total non-farm employment count has been adjusted upwards. There may be valid reasons for these adjustments but no explanation is provided.

We next compare the counts released of past years, as reported in 2013, to the count of past  years, as reported this month in 2014. Here is June 2013 report:

2011juneemp

Chart 3

Look at the January row in Chart 1, above, and compare the values to the January row in Chart 3.  Specifically, look at January 2009:

  • In 2013, ESD reported January 2009 employment of 210,800.
  • In 2014, ESD reported January 2009 employment of 213,900.

The employment numbers are estimates – not an actual count and there is an associated error range or confidence interval about the estimate. Based on the later revisions, it seems this estimate is about + / – 1.5 percentile points from later revisions. That is wide confidence interval.

This blog presents the WA ESD charts and data but has previously seen unexplained revisions in even the current monthly report. For that reason, the BLS data series is preferred.

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Moody’s ranks Spokane #289 (4th quintile) for employment growth and identifies these Strengths and Weaknesses:

Strengths

  • Low cost of doing business, especially office rents and energy.
  • Large healthcare industry provides stability.

Weaknesses

  • Dearth of high-wage, export-oriented industries.
  • Incomes are further below the national average than living costs.
  • Little exposure to aerospace manufacturing and few avenues to capitalize on growth elsewhere in Washington.

Hmmm … that must be in error because Greater Spokane says:

Our region’s Aerospace industry is soaring to new heights with area businesses taking full advantage of the need for new and efficient aircraft. Worldwide, the Aerospace industry is booming with innovation, new products and increased competition.

Spokane and the Inland Northwest are home to more than 120 manufacturers, suppliers, distributors and organizations related to the worldwide aerospace industry. With a diversified product and service base, Spokane businesses are landing dozens of contracts each year.

Actually, this is probably an indicator that Spokane’s leading export commodity is, unfortunately, bull shit. By the ship load.

Meanwhile, Spokane Rock Products laid off a big chunk of their asphalt paving division – read the comments to the news report (in Spokane, the comments frequently explain the real story). Far less housing construction means less road paving and fewer workers needed.

Riverfront Park Master Plan 2014 acknowledges low wage/poverty problem

Link to Spokane’s Riverfront Park Master Plan (PDF file). Most of the development ideas are pretty cool, and the park is in need of an upgrade.  The long term neglect is an indicator that reminds us of the poor economic situation. From the Master Plan itself:

“While the city of Spokane is the second largest metropolitan region in the State, it has some of the highest rates of poverty. Spokane’s median household income is just 70% of the statewide figure.”

More on that topic:

The following is quoted from those linked pages.

As you can see in the following chart, while Spokane (red line) wages have increased, average wages in the state (blue line) have increased faster. Over several decades, wages in the State have increased at twice the rate of wages in Spokane. Stated another way, the longer we stay in Spokane the further behind we fall.


Average wages are about 80% of the rest of the State, yet our costs of living are closer to 100%. We have to spend close to the national average to live here (somethings, like health care, are priced higher than the national average).

[Update: The Riverfront Park Master Plan says that median wages have fallen to the 70% level. The chart above uses average wages, not median, but chances are good that the average wage has fallen further, as this has been a 30 year trend.]

Source: Spokane Poverty Rates

Analyst: “Ambassadors Group – Successful Turnaround Unlikely”

UPDATE: Since this was posted, Ambassadors Group announced the lay off of 40 workers.

The Ambassadors Group is likely to disagree: Ambassadors Group – Successful Turnaround Unlikely (EPAX) | Seeking Alpha. (Free registration required to read the entire article.)

Ambassadors Group is based in Spokane. In recent years, their annual revenue has been cut in half, founding executives departed without a meaningful explanation, and the company put its newly constructed corporate headquarters up for sale. The analyst notes positive developments such as tight control on expenses and the company continues to pay a dividend. Some executives have recently increased their shareholdings suggesting a sign of confidence in their strategy.

On the downside, this analyst notes the business relies on shady marketing techniques, and the number of students enrolled for 2014 travel programs has fallen by 12% from 2013, as previously enrolled students are withdrawing from the programs. The analyst’s concern is that enrollments are continuing to drop and the firm will eventually run out of cash. The 6.6% dividend is well above market averages and is a sign of risk.

The company is trying to sell its corporate HQ building but it remains unsold after one and a half years and a price drop from $13.3 million to $11.9 million:

This raises some doubts on the true value of the building. If company is unable to sell it for the indicated price and is not renting-out the unused half, maybe there is no demand for such office space in Spokane and the value of the building is significantly less than $11.9m.

The analysts main concern is long term declining enrollments indicate the turn around strategy is not working and the firm will eventually run out of cash.

85% of the company’s 218 employees are based in Spokane.

My take is that I would not rule out a turn around; however, numerous years of year-over-year declines in sales/revenue is worrisome. During this decline, revenues have been cut in half, total assets are down by a third, and net income was negative in 2013. Couple that with an on-going struggle to maintain enrollments and revenues, this makes for a difficult situation.