As a new year approaches, the region’s economy appears to be holding steady, with a bit of a slowdown typical for the winter season. 

Back in June, the regional economy was “chugging along” just fine, and it’s largely staying that way.

Jobs have seen an increase and there’s been a slight decrease in the labor workforce, but while things have been slow compared with the last two years, the data is steady historically, said Ajsa Suljic, regional labor economist with the state Employment Security Department.

Steady year

Between September 2023 and September 2024, jobs increased 1.4% while the labor force, or the “number of people in the market to supply their skills and eligibility for the jobs,” decreased by 3.8%, Suljic said.

Because of people entering and leaving employment, shifting between entry to mid-level jobs, switching educational institutions or retiring, September saw a 4% unemployment rate, down from August’s rate of 4.8%. 

Historically, the labor force has been growing each year, she said. “The only decrease we recorded in labor force was in 2020 due to (the) pandemic, and we recovered quickly and we’ve been stable since then. 2021 growth, 2022, 2023 growth averages and average 2024 should be growth as well.”

Many industries have been contributing to the region’s growth in the last year, including construction, retail, health care, educational services, and leisure and hospitality.

The diversity of Tri-Cities industries is key to its economy, Suljic said. “When you have this diversity in industries, you have more ability to navigate the growth or be stable in resiliency against other downturns in economy.”

The educational industry in the Tri-Cities is also a major contributor to stability, Suljic said. Having good options for higher education keeps people in the area. 

The manufacturing sector has not done as well, but Suljic said that there are often good and slow years in that industry, especially for manufacturers tied to agricultural products – and the Tri-Cities has a lot of them: 68% of regional manufacturing is in food manufacturing. 

But on a larger scale, manufacturing has generally been expanding and adding jobs, Suljic said.

Looking forward

In the immediate future, Tri-Citians can anticipate a winter slowdown.

With most agricultural work wrapping up in mid-November and construction slowing down in the cold and snowy months, winter can mean a lull for the economy. 

Then, typically “everything starts going back into place, starting in February,” Suljic said. “By end of March, we are in full swing of that summer employment and full employment."

The first and second quarter of 2025 likely will be a bit on the slow side as well, Suljic said, with jobs on the rise again around the end of the second quarter. Jobs will be growing, though not by a huge percentage. 

And an election year doesn’t necessarily change things either – what’s most important is behaviors toward spending, Suljic said. 

When people have the confidence to spend, “once they spend, the money turns around, we can build homes,” Suljic said. “We can invest in extra health care services or retail trade services, food services like this and so forth that propels community and economy.”

Attractive region

The Tri-Cities area remains an attractive place for a variety of industries. The region is home to “cluster” industries such as agriculture, which means that multiple parts of an industry are all in a relatively small area. 

In industries like agriculture that means not only are raw materials nearby, but manufacturing facilities, warehouses and a variety of transportation options are available within the same region.

“We have barge, we have rail, we have trucks and we have air, all of it very close proximity, (a) very small footprint that you can access,” Suljic said. 

Equally attractive, however, is the workforce centered on a growing area. As the population continues to grow and expand in the Tri-Cities, it fuels operations within and around the cities. 

The population growth in the region between 2010 and 2023 was 25%, compared to 18% in Washington and 8% across the country. That growth was evenly split between migration and natural growth. 

And 32% of the population is 24 and younger. “When you have that population, you have labor force supply,” Suljic said. With education options in the area, young people are encouraged to stay here, work here and raise families here as well.

Recent developments in the region, like the closure of Lamb Weston’s Connell plant and the opening of Amazon’s Pasco warehouse, haven’t yet had an impact on labor numbers, Suljic said. 

That’s because in Lamb Weston’s case, the layoff process is still ongoing, and employees receive severance pay, meaning that they aren’t considered unemployed yet. 

Though the impact will be felt in Connell, it may not affect the region as a whole, Suljic said, “especially because those individuals (who) are getting laid off from that plant are highly demanded by other facilities. They may be picked up, even before they hit unemployment, into other jobs.”

As for Amazon, that impact won’t be seen in numbers until early 2025, when the company’s first reports from October and November come through. 

“But for the community, as we know, it’s meaningful. I mean, 1,500 to 1,700 jobs, really good wages, benefits and so forth, people will find more stability, and will have more options to have more stable, reliable jobs, shorter commute,” Suljic said.