Tight Labor Market Puts Pressure on Tri-City Wages

The Tri-City unemployment rate remained near record-low levels in November, reflecting a continuing expansion that has buoyed for more than three years.

As one year clocks out and another clocks in, the state’s top labor economist predicts business will remain bullish through the coming year.

“As the expansion lengthens, we’re starting to see more spreading out into the other counties,” said Paul Turek, state economist for the Washington Employment Security Department.

Figures released Wednesday show the Tri-City seasonally unadjusted unemployment rate was 5.2 percent in November, well under the 6.6 percent from a year ago. November’s adjusted unemployment rate was 5.4 percent, slightly above the record-low 5.3 percent set in August, Turek said.

Turek said the unemployment rate has likely bottomed out, which could put pressure on employers to raise wages to retain workers.

“Once we hit this point in the business cycle and the unemployment rates are as low as they are, we see workers become a bit more scarce. That tends to support hiring and wages as well,” he said. “We’re looking at some mild wage increases across the state.”

Mid-Columbia employers are taking note, said Carl Adrian, president and CEO of the Tri-City Development Council, or TRIDEC.

“I think we’re starting to hear a little bit of rumbling from the employer community about people not being able to find workers,” he said. Employers are reporting rising turnover rates as hourly workers depart for better wages.

Technology-fueled King County is the state’s primary economic engine. The unadjusted unemployment rate in the Seattle area dropped below 3 percent in April and is currently hovering at the 4 percent level. But after years of continued expansion, Turek said the benefits have spread to most areas of the state.

On a year-to-year basis, the Tri-City economy has grown to 114,400 nonfarm jobs, from 111,700 last year.

“We’ve had a good hiring year throughout the state,” he said.

In the Tri-Cities, construction remains the shining star for growth as demand for workers soars on both public-sector projects, such as schools, and private, such as new homes and private commercial buildings.

There were 8,700 construction jobs in the Mid-Columbia in November, an increase of 900 positions, or 11.5 percent, compared to a year earlier.

Government remains a major employer, accounting for 20,500 jobs. Most of those are associated with local government, namely schools. Waste services, which covers the Hanford site, employed 11,800 people in November, or 500 more than the previous year.

Retail added 100 jobs over the past year, for a total of nearly 14,000 local positions in November.

The local civilian labor force expanded by 2 percent to a total of 136,466 workers in November. There were 7,029 people actively seeking work in Benton and Franklin counties.

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