Tour highlights state’s manufacturing sector

Tour highlights state’s manufacturing sector
A tour by the Association of Washington Business of Washington’s manufacturers highlights the role of this sector in the state economy and sheds light on persistent regulatory challenges. Photo: freepik.com

The state of Washington’s manufacturers has gained the renewed attention of state lawmakers and business groups interested in the sector’s long-term health, and the current landscape was assessed during a tour of the state by the Association of Washington Business (AWB) as part of Manufacturing Week.

While nonfarm jobs have increased in Washington by 30.5 percent since 1998, manufacturing employment has fallen by 21.5 percent; since 2000, the manufacturing sector’s share of the overall state workforce has shrunk by three percent.

Although some industry analysts point to increased worker productivity and automation as drivers of change, others note that the state is suffering from a lack of skilled labor to either fill open positions or jobs held by older employees. Insufficient pay doesn’t seem to be the reason; the average manufacturing salary is $88,493 compared to the average nonfarm salary of $57,482.

The AWB tour included a visit to Wenatchee-based Stemilt Growers that grows, packs and markets fruits such as apples, pears, cherries, peaches, nectarines and apricots. Although the company is at the height of its hiring season, it is a perpetual struggle to fill the available jobs.

The tour also stopped at businesses ranging from hop growers in Yakima and Alcoa Intalco Works in Ferndale to Vaagen Timber in Colville and Boeing’s Auburn plant – all underscoring the ties among Washington’s exporters and manufacturers that compose 81.2 percent of all exported goods. Between 2010-2018, the value of exported goods grew from roughly $41 billion to $63.1 billion – a 54-percent increase.

“We’re the most trade-dependent state in the country,” AWB President Kris Johnson said. “That means you must make a lot of amazing products from apples to gloves to Boeing and computers. This is about celebrating and talking about how important the manufacturing sector is to the state economy.”

The tour also provided manufacturers an opportunity to reflect on challenges they face. With such a strong presence in state exports, anxiety remains around the ongoing trade war between the U.S. China. But equally important to industry members is the state infrastructure improvements that enable them to ship perishable goods to foreign markets faster. The Port of Moses Lake is considering adding cold storage facilities at the Grant County International Airport for cherries flown out by Boeing 737s. According to the Columbia Basin Herald, Boeing now has around 130 737s at that airport.

Among the top concerns AWB heard from manufacturers were the state’s business and occupation (B&O) tax and the ongoing issues with regulatory unpredictability related to permitting. The reliability of inexpensive power is also pertinent to energy-intensive employers. During this year’s legislative session, state lawmakers approved a bill mandating that utilities provide carbon-free energy by 2045. That will necessitate a shift away from the natural gas that, according to the Northwest Gas Association, is provided by four Washington utility companies to three million people and 100,000 businesses.

“How do we maintain, preserve, if not otherwise grow that competitive advantage of low-cost, affordable, reliable baseload power?” Johnson said. “We need to talk about that baseload energy sector that helps these companies grow and expand and maintain their presence here.”

The tour concludes tomorrow in Yakima.

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