The state Economic and Revenue Forecast Council just released its October update on revenue collections for the past month, and it shows a modest $36.6 million gain above September’s forecast. But council executive director Steve Lerch is qualifying that news by saying the gain was tied to the timing of tax payments and may be partly erased next month.
See his full report here and a news release from the agency here. In the full report, Lerch points out that some sectors of the state economy are doing well, but others not so much – and job growth remains a concern as jobless rates have risen.
In the last three months the Washington economy added 12,700 jobs for an annualized growth rate of 1.8%. Led by Boeing, manufacturing employment growth remains strong. Of the 3,700 manufacturing jobs added in the last three months, 3,400 were in the aerospace sector. Construction employment growth remains weak with only 500 net new jobs and government employment continues to decline, shedding 600 jobs. As usual, most jobs were created in the private services-providing sectors which added 9,200 jobs in the last three months. In spite of the continuing gains in payroll employment, the state’s unemployment rate has been increasing in recent months. After declining from a high of 10.2% in December 2009 to 8.2% in April 2012, the unemployment rate increased to 8.6% in August.
On the other hand, the beleaguered housing industry is beginning to turn around:
Washington housing construction, as measured by building permits, continues to strengthen. To date, the upturn in the construction sector has been led by multi-family housing. So far this year (through August) multi-family permits are averaging 11,500 (SAAR) which is nearly three times higher than the 4,000 for all of 2009, the low point in housing construction.
In contrast, single-family permits have improved much less, to an average rate of 16,200 so far this year which is a 26% increase from the 13,000 units in 2009. Overall housing units are averaging 27,700 so far this year which is 74% higher than the 2009 average.
While this sounds like a huge increase, it should be remembered that it is off a very low base. Total housing units this year are still running 48% below the 53,000 units permitted in 2005. While the recent growth in housing construction has been concentrated in the multi-family sector, we expect the mix to move more to single-family construction.