Seattle performed better than expected in the pandemic economy


That economic recovery was the strangest I’ve ever seen: a whirlwind jobs boom accompanied by the highest inflation in four decades. The Federal Reserve has applied powerful medicine with interest rate hikes, but a feared recession has not yet materialized.

Let’s see how the situation in Seattle and Washington developed.

jobs. Although the nationwide unemployment rate hit nearly 17% in the pandemic spring of 2020, it was 3.7% in July. In King County it was a staggering 2.9%. Economists consider 4% “full employment”.

Nationally, the economy has added 1.1 million jobs since May, fully recouping losses from the pandemic and depriving Republicans of a key issue in the midterm elections.

Population. Data on Seattle’s 2020-2021 win or loss is conflicting, and both ways are modest.

In the same period, many large cities experienced historical population declines, including San Francisco, New York, Washington, DC, Boston, St. Louis and Atlanta. So much for the back-to-town movement that has transformed inner cities for over three decades.

But not so fast. Last year Manhattan has seen a population recovery. So does Dallas, Atlanta, Houston, Miami, DC, even San Francisco. Manhattan, which lost the most residents to the pandemic flight, has regained the most of any New York City borough. One year isn’t a long-term trend, but it’s still too early to invest in our major cities, including Seattle.

Act. Many of the tariffs and trade disputes that began under the Trump administration largely continued with President Joe Biden. When former President Donald Trump pulled out of the high-standard trans-Pacific partnership, American leadership disappeared and Biden’s attempt to regain it was shattered Indo-Pacific Economic Frameworkhas repeatedly struggled with delays.

Washington is America’s most trade-dependent state. Merchandise trade exports totaled nearly $54 billion in 2021, compared to a peak of more than $90 billion in 2014. China remained the state’s largest export partner despite tensions between Beijing and the other Washington.

In 2014 almost 366,000 jobs were linked to trade. In 2020 it was less than 139,000.

This year could be a little better. According to WISERTrade, an analytics firm, exports totaled $35.7 billion through July.

property. In the 2010s, Seattle often ranked at the forefront of emerging trends in real estate, the relevant annual report by PricewaterhouseCoopers and the Urban Land Institute.

In the latest report, Seattle was ranked 9th, the only West Coast city to make the top 10. In 2021, Seattle dropped to 39th place. This is also a major achievement considering Seattle’s homelessness and crime problems. At the top were Nashville, Raleigh-Durham and Phoenix.

Overall, 54% of real estate managers and developers surveyed said they would “hold” real estate in Seattle, while 31% would “sell.”

One respondent said, “Increasing population diversity is a catalyst to attract more diversity and the best talent.” Another pointed to the “rich history of entrepreneurship from Boeing to Paccar — not to mention Amazon, Microsoft, Weyerhaeuser, and the retail giants Starbucks, Nordstrom and Costco, among other local legends. Significant ongoing projects include a major redevelopment of the central waterfront and convention center expansion, as well as headquarters projects for Microsoft and Amazon.”

Seattle was also the construction crane capital for most of the previous decade. Remote work and other consequences of the pandemic put an end to that.

The construction consulting company Rider Levitt Bucknall’s most recent crane count for the first quarter of this year states, “The Seattle crane count remains stable. The Capitol Hill area saw a rebound in construction activity, while downtown saw a decline in cranes. A review of industry activity shows that most cranes are used on residential sites. Compared to the previous survey, educational projects are increasing, healthcare facilities are holding steady, and commercial work is declining.”

Toronto, Chicago, New York and San Francisco showed the highest increase in crane numbers.

The macroeconomic outlook. Seattle and the nation will be at the mercy of the Federal Reserve’s fight against inflation.

So far, the Fed has raised rates aggressively without triggering a recession. Former Fed Chairman Alan Greenspan was famous for devising such “soft landings”. But Greenspan has never faced such a combination of a hot economy and high inflation. So far, inflation appears to be easing without the recessionary downside.

Lisa Shalett, Chief Investment Officer of Morgan Stanley, wrote“We appear to be approaching the ‘late’ stage of the current economic cycle, a phase that typically still features positive but slowing growth rates in the economy and corporate profitability.”

Part of this profitability is undoubtedly due to price gouging.

The inflation-reduction bill recently passed and signed into law by President Joe Biden will not directly bring prices down quickly. But it represents numerous long-overdue investments to address climate change and infrastructure that will more than pay the price. Inflation is primarily the job of the Fed.

But parts of the new law will help. Most importantly, Medicare can negotiate prices for certain expensive drugs and cap drug costs for Medicare beneficiaries. Also, drug companies must provide a rebate when drug costs rise faster than inflation.

The future of work. I do not know. Never going back to the office seems like a difficult way to do business for most companies. Even at the peak of the pandemic, only 35% of people were able to work fully remotely and that number is declining rapidly.

In a tight job market, people can indulge in so-called quiet quitting, where employees just do the work in their job description and avoid overtime.

must be good I’ve always run scared and have always loved my jobs, whether as a paramedic, college theater teacher, or journalist. Most people may hate their jobs. At second glance, it doesn’t sound nice at all.


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