Thank Boeing for region’s strong export ranking
Aircraft products and parts accounted for 57 percent of the value of exports produced in the Seattle area last year. A distant second: information-technology royalties, at 8 percent.
Special to The Seattle Times
One undeniable success in this lackluster recovery has come from export growth, and that has been centered in America’s 100 largest metropolitan areas. You probably won’t be surprised to know that Seattle-Tacoma-Bellevue ranked No. 6 in the total value of goods and services sold overseas.
This comes from a new Brookings Institution report showing that metro exports were responsible for one-third of the growth in gross domestic product nationally from 2009 to 2012. In the 100 largest metros, exports powered 54 percent of output growth. And the top 10, including Seattle, accounted for 28 percent of U.S. exports last year.
Brad McDearman, director of the Metropolitan Export Initiative at Brookings and lead author of the report, said that Seattle performed well in total exports, and in “export intensity,” meaning the importance of exports to the overall economy.
When I asked him about our strengths, he said, “The region exports in a wide variety of goods and services sectors and would be fairly diversified if aircraft products were taken out of the equation.”
But that is the Dreamliner in the living room.
Aircraft products and parts accounted for 57.4 percent of the value of exports from here last year. Not even a close second: information-technology royalties, at 8.3 percent. The study is based on where export goods and services are produced, rather than from where they are shipped.
While the Washington aerospace cluster is composed of 1,250 companies, according to the Governor’s Office of Aerospace, Boeing is the essential foundation.
So if Seattle wants to maintain its remarkable standing in exports, keeping Boeing happy will be job No. 1.
And it is remarkable. Most of the other top 10 export metros are more populous than Seattle-Tacoma-Bellevue. We are the 15th largest metropolitan statistical area and yet are way ahead in exports from most similar-sized places. For example, Phoenix, No. 13, ranked 17th among the top 100.
Our heavy aerospace dependency “leaves the metro vulnerable to up and down cycles in this industry,” McDearman told me. We are also at risk as Boeing diversifies its locations. “Charleston’s exports and intensity are projected to rise dramatically in the coming decade largely due to Boeing.”
Another danger is that other metros are upping their export game because this has proved to be one way out of a slow recovery. One example is Portland’s We Build Green Cities strategy, which seeks to market its sustainability companies and expertise to the world.
This is a new move for most cities. For a century the United States was the world’s leading export nation before recently being overtaken by China. But with the planet’s largest market in the 50 states, it was natural to look within for most business.
That’s slowly changing, although according to a World Bank report, exports made up 14 percent of U.S. GDP in 2011, compared with 31 percent for China and 50 percent for Germany. The Brookings researchers project that few metros, including Seattle, are on track to meeting the Obama administration’s 2010 goal of doubling exports in five years.
American exporters face heavy competition and stealth protectionism. The United States suffers from a large and persistent trade deficit, which has only gotten worse with so-called free-trade agreements that were promoted as a way to solve it. That deficit translates into lost jobs.
And being an export powerhouse isn’t a guarantee of a healthy economy. Metropolitan Detroit ranked 8th in the Brookings study, even as the Motor City itself hurtled into bankruptcy.
The big picture is this: Growth is about 11 percent below the average post-World War II recovery this far after the end of a recession. The collapse was far deeper and rebound weaker than even the 1981 recession, which had been the worst post-Depression downturn until 2007.
Loss of jobs was even worse — the most severe since the 1930s. Unemployment remains painfully high despite corporate profits reaching records.
The housing market, whose boom had cloaked deeper wounds, distortions and changes in the economy in the 2000s, isn’t going to come back and save us.
Finally, the continuing push for austerity is holding back growth. This is an unprecedented policy change in modern times.
No wonder the Census Bureau report last week contained the staggering news that adjusted for inflation, the typical American family made less last year than it did in 1989. Finding the way out of this mess won’t be easy.
So far, Seattle has been more fortunate than most places. This column frequently discusses the many reasons why. But a big one is that we are plugged into the world to an unusual degree for an American metropolis.
Exports are a big part of that advantage. Now we have to keep them growing.
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