Tri-Cities economy shows strength and position for growth
Although the Tri-Cities unemployment rate is still higher than the state and nation, other economic indicators are strong in the Mid-Columbia.
[blockquote quote=”Our area is in dramatic need of new construction.” source=”Gayle Stack, owner of EverStar Realty” align=”right” max_width=”300px”]
Local industry leaders and experts, from economists and realtors to hospitality and government officials gave their summaries of the 2015 Tri-Cities economy and forecasts for the upcoming year at TRIDEC’s 17th Annual Economic Outlook, which was held late January at TRAC in Pasco.
Ajsa Suljic, a regional labor economist for the Washington Employment Security Department, said Benton County’s unemployment rate dropped to 6.1 percent in November and Franklin County had a 7.4 percent rate, giving the Kennewick-Richland-Pasco Metropolitan area a combined rate of 6.5 percent. While that still trails the state’s unemployment rate of 5.3 percent, it is 1.5 percent lower than a year ago.
Suljic said the area is still in a recovery mode, and that in November, the total labor force was 128,104, a drop of 1 percent from the same time in 2014.
Nonfarm employment saw a 4.8 percent gain year-over-year, with employment of 108,100. Part of that included a 4.7 percent gain in construction jobs from November 2014 to November 2015, and a 7.9 percent increase in manufacturing employment.
Last year was better for local retailers, as well, said Barbara Johnson, Columbia Center’s general manager, and the cities’ sales tax distribution is the best indicator for that.
The City of Kennewick saw a 9 percent growth, year-over-year; Pasco was up 9.8 percent; Richland had a gain of 8.1 percent; and the City of West Richland saw an increase of 14.8 percent. The counties also saw growth, with Benton County showing a 22 percent increase and Franklin County up 7.2 percent.
Johnson said an increase in auto sales during 2015 played a big part in those positive numbers.
But the area also saw new national retailers coming to the area, with Richland’s Queensgate shopping center experiencing growth, as well as Southridge and Columbia Center.
There was positive news in the housing market, as well, according to Gayle Stack, president of the Tri-City Association of Realtors and the broker/owner of EverStar Realty.
“It’s a bit of a great market for some, but not for others,” Stack said.
Especially not for those who are seeking a lot of options in the housing market.
It’s a buyer’s market out there, with housing inventories at all-time lows.
From 2011 to 2015, the average Tri-Cities’ home price rose by 12.6 percent to $223,900.
Last year, 4,135 homes were sold in the Tri-Cities, compared to 3,477 in 2014 and 2,881 in 2011.
That has led to the higher prices and lower inventories.
In December, there were just 598 active listings in the Tri-Cities.
The lack of housing is also pushing up apartment prices, which rose more than 21 percent from 2011 to 2015.
The upside is that the dearth of housing could lead to more new construction, which means more jobs.
“Our area is in dramatic need of new construction,” Stack said.
Corey Pearson, manager of the Three Rivers Convention Center, said tourism in the region is vibrant and thriving, with new hotels coming online and new events and facilities to draw visitors to the area.
The number of guestrooms available in the Tri-Cities increased by 506 to nearly 4,000 in the past two years, with the addition of three new hotels in 2015— the Homewood Suites by Hilton in Richland, the Hampton Inn at Southridge and the new Springhill Suites by Marriott, attached to Three Rivers. That includes the reopening of the M Hotel and Conference Center in Richland.
And more are on the way, including a new 120-room Hampton Inn, which is under construction near TRAC in Pasco, and the Lodge at Columbia Point, an 82-room boutique hotel being built adjacent to Budd’s Broiler.
Pearson said more people are blending their business travel with leisure, tacking on a few days prior to or after a business event to explore. The area’s wineries and the new B Reactor National Park lend themselves well to that model, and once people have been to the Tri-Cities, they often return.
That’s true for many conventions and sporting events held in the area, he added.
“It can be hard to get a group here the first time, but it’s easy to get them to come back, Pearson said.
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