However voters choose to answer the question, “Are you better off today than four years ago,” it serves as a useful marker for examining the condition of Seattle and Washington.
In 2007, Seattle had flown above the downturn engulfing most of America. By fall 2008, all of us were facing the abyss.
Four years ago, the world was confronting the most severe financial crisis since the Great Depression. The exclamation point came Sept. 25, 2008, when Washington Mutual became the largest banking failure in American history.
Nearly 4,000 well-paying headquarters jobs in Seattle were lost, as well as the ecosystem of professional services and vendors, and sizable local philanthropy, that depended on the 119-year-old thrift.
Another signature Puget Sound-area company was also facing trouble. Boeing was in the midst of a 57-day Machinists union strike that would cost perhaps $3 billion and set executives on a course to establish a 787 assembly line in anti-union South Carolina.
The Dreamliner itself was badly behind four years ago because of Boeing’s decision to use elaborate outsourcing. The airplane sold as the future of the Boeing Commercial Airplanes was becoming not just the butt of jokes but a serious risk to the company.
Even before WaMu’s collapse and the strike, disappointments began turning into a cascade of hammer blows.
Work had already stopped on the architecturally edgy 1 Hotel and Residences downtown Seattle, leaving nothing but a gaping pit on Second Avenue. Not until 2009 did the owner refill the hole.
Plans for other skyscrapers in Seattle and Bellevue were shelved as demand collapsed and financing dried up.
In February, Macy’s announced it would close its Northwest regional office and move 750 jobs from downtown Seattle. Two months later, Safeco, founded in 1923, was sold to Liberty Mutual, marking yet another headquarters loss.
In August, Weyerhaeuser, one of the Northwest’s most iconic companies, cut 1,000 jobs at its Federal Way headquarters on the way to turning itself into a real estate investment trust. Layoffs spread to other companies, including Alaska Airlines.
In 2009, Microsoft carried out the first companywide layoffs in its history.
Things were that bad.
Nor was the Puget Sound region immune to the housing crash. Residential prices started a long swoon. By October 2008, Seattle-area house prices were down 10 percent from their peak on the Case-Shiller index. It wasn’t the 40 percent loss of Phoenix, but plenty of residents here were hurt.
As the fall financial panic made it difficult for exporters to get credit and recession killed consumer demand, the region’s ports suffered. Both Seattle and Tacoma would see lower container volumes.
By October, the state’s unemployment rate rose to 6.1 percent compared with 4.6 percent in January. This lagging indicator would peak at 10.2 percent by December 2009 and stay that way for the next four months. Construction jobs were especially decimated.
Seattle’s unemployment rate was just 3.7 percent that January. By October it rose to 5.4 percent on the way to 9.7 percent in October 2009.
Four years later, we’re in much better shape, with one big caveat.
The stock market’s recovery has propelled Amazon.com shares from $61 four years ago to more than $250. The same is true across an array of Puget Sound stocks, including Expedia, Paccar, Nordstrom, Starbucks and F5 Networks.
Real gross domestic product for Washington reached $311 billion in 2011, surpassing its previous peak. Output for Seattle-Tacoma-Bellevue has also rebounded and moved beyond its old highs. International trade has recovered. House prices are finally on the upswing.
Downtown Seattle has enjoyed a dramatic turnaround, and cranes are a common species once again. Apartment towers are rising, and at least one major condo project appears real. Employment is rebounding from the WaMu loss, helped by the relocation of Russell Investments from Tacoma.
The big dog is Amazon.com’s urban campus in South Lake Union, as well as plans for three towers in the Denny Triangle.
Development and business activity are also picking up again in Bellevue. The region’s two urban cores illustrate one real reset from the recession: the appeal of dense city centers.
Boeing is delivering Dreamliners, and a long-term agreement with the Machinists helped ensure the next-generation 737 will be built here. A new Air Force tanker will probably come our way, too, if the other Washington can avert draconian cuts.
That optimistic situation, however, is clouded by a new contract dispute between Boeing and its engineering union.
At 41,651, Microsoft’s state employment in August was actually higher than in August 2008.
Yet unemployment remains a problem. In the Brookings Institution’s Metro Monitor, which tracks cities’ recovery from the Great Recession, Seattle-Tacoma-Bellevue ranked 37th out of 100 in unemployment. Not bad, but not great.
Washington unemployment remains above a too-high national average. Thousands of families are still hurting.
The macroeconomic numbers and rebound of big corporations tell only part of the story.
Budget cuts have wounded state universities, key magnets for talent and innovation. With the loss of WaMu, Seattle is no longer a major financial center and likely never will be again. Tax revenues are recovering too slowly.
Consumer lending remains well below pre-crisis levels. According to an analysis by The Wall Street Journal, loan originations in 2011 were down 38 percent in metro Seattle compared with 2006.
The Great Recession killed many beloved local shops. The Seattle Post-Intelligencer stopped its print edition in March 2009. Libraries closed temporarily as tax revenues shrank. Many independent bookstores closed permanently.
On the other hand, nobody’s laughing at the South Lake Union streetcar anymore; Amazon is paying to expand its service. The viaduct is coming down, to be replaced by a tunnel. The 2008 loss of the Sonics pro-basketball team might be redeemed, although that debate remains. Pike Place Market not only survived the downturn but also a renovation, and it seems as lively as ever.
Are we better off than four years ago? The answer for most probably depends on whether they have a decent job.
But for the city, metro area and state: Yes, we are. Although it’s a fragile yes.
You may reach Jon Talton at firstname.lastname@example.org
About Jon Talton
Jon Talton comments on economic trends and turning points, putting them into context with people, place and the environment in the Pacific Northwest