Planting numbers: Farming still crucial to Basin employment

MOSES LAKE — Despite the rise of manufacturing in the Columbia Basin, farming is still the base for all economic activity in the region.

“I think about the economies here (in Grant County) and six of the even counties I serve, they’re heavily agriculture-based,” said Don Mesek, a labor economist with the Washington State Department of Employment Security in Ellensburg. “It doesn’t mean we don’t have other aspects of the economy. But it does mean that agriculture is a pillar of our local economy.”

Meseck analyzes employment trends in Adams, Chelan, Douglas, Grant, Kittitas, Okanogan and Yakima counties, providing regular reports on how many people are employed, looking for work, and are likely no longer looking for work. Of the 22 employment classifications tracked by the U.S. Bureau of Labor Statistics — everything from management and professional services to sales to manufacturing — Meseck said that agriculture-related jobs, both on-farm and in food processing and handling, accounted for 22.9% of all jobs in Grant County.

“It’s significant because statewide, we have 2% to 3% of our jobs in agriculture, and nationwide it’s 1%,” he said.

Data provided by Grant County Trends, a website maintained by Eastern Washington University’s Institute for Public Policy and Economic Analysis, provides a fairly comprehensive snapshot of the county’s workforce. In 2021, the last year for which the website has complete data, 44,343 people were employed in Grant County, which had a population of just over 100,000 in the same year.

That’s the biggest the county’s workforce has been since 1993, which is as far back as the Grant County Trends website goes.

While agriculture provides nearly one out of every four jobs in Grant County, Meseck said government employment — state, county, city, school and other special districts — accounts for another roughly 20%, while non-agriculture-related manufacturing in Grant County accounts for around 10% of all jobs in the county.

Agriculture’s share of employment, however, has been slowly falling from 27.7% in 2012 to the current 22.9%, according to the Grant County Trends website. Meseck said much of the job growth in the county over the course of the last ten years has been among professional and technical services — workers in the county’s expanding data centers, for example — construction, health care and local government.

“If I look at our long-term, historical quarterly census, employment, wage data, (then) health services, professional and technical services, construction and local government accounted for nearly two-thirds of the 4,668 jobs added from 2011 to 2021,” Meseck said.

Most industries in Grant County have recovered from the effects of pandemic-related lockdowns imposed in 2020, Meseck said, and the county’s non-farm employment rate is higher than it was prior to the outbreak of COVID-19. However, some employers have still not recovered from the halt on economic activity imposed in 2020, he said.

“Durable goods manufacturing is still down. Also, we’re down about 360 jobs compared with 2019,” Meseck said.

While he hasn’t crunched the most recent numbers for Adams County, Meseck said the situation there is similar, though with a population of only 20,000 — one-fifth of Grant — Adams County is even more reliant on agriculture, Meseck said.

“It’s even more heavily agriculture-based,” he said. “It has a fairly large manufacturing sector, but 80%-90% of the manufacturing jobs in Adams County are food processing and related, so it’s actually doing quite well.”

“In Adams, agriculture is still king,” Meseck added.

Adams County is not one of the 10 counties tracked by the EWU’s Institute for Public Policy and Economic Analysis, which compiles demographic, employment and economic activity information for Skagit, Chelan, Douglas, Grant, Yakima, Benton, Franklin, Walla Walla, Columbia and Spokane counties.

Patrick Jones, an economist at EWU and executive director of the Institute for Public Policy and Economic Analysis, said agriculture is foundational to Central Washington’s manufacturing base. Wherever there is food processing, there is a base for industry to grow and expand on, he said. And that’s important because even if farming and food processing still provide the bulk of the region’s jobs, the overall share has been falling as other jobs have expanded.

“Grant County has been very successful in attracting other forms of manufacturers,” Jones said. “Yes, agriculture is still number one or number two (in Central Washington) when it comes to the number of the most important sector or industry. But in most communities, it’s not as important as it was 10 years ago because the economies have diversified.”

As the region’s economies evolve, Jones said the counties of Eastern Washington have a significant advantage over those of the West Side — the median age of their populations, and thus their workforces, is younger.

“The labor force is a blessing in Central Washington because it is largely young,” he said. “Because of its youth, it’s very engaged in trying to make a living.”

According to Grant County Trends data, the median age of a county resident in 2021 was 33.9 years, whereas the Washington state median was 38.2 years and the national median age was 38.8. Jones said the county’s relative youth was the result of its large Hispanic population, which is also inclined to have a strong work ethic and high labor force participation.

“Culturally, it just has an affinity to work,” he said.

However, Jones also said there has been a steady decline in the last ten years in overall workforce participation — fewer and fewer people are opting for work. The causes are varied, from an aging population, parents leaving the workforce because of COVID-19 to take care of their families, to increasing numbers of people on disability for one reason or another, Jones explained.

“If you go back 10 to 20 years, you will see statewide that we’ve gone from around 70% (workforce participation) to a little above 60%,” he said.

According to figures compiled and published by the Association of Washington Business’s AWB Institute, statewide workforce participation figures fell to 62.2% in 2022 from 67.2% in 2000. During the same period, the institute reported the state’s overall labor force rose to just over 4 million workers in 2022 from just above 3 million in 2000.

Workforce participation in Grant County was at 61.6% in 2022, just a little under the state average, while workforce participation in Adams County was at 67.1%, 60.7% in Franklin County, 64.6% in Benton County and 66.9% in Yakima County. However, a number of Washington counties — most of them on the Pacific Coast — have workforce participation rates of less than 50%, with the lowest being Wahkiakum County, 34.4%, and Ferry County, 38.1%.

“A shrinking labor force is usually not good economic news,” Meseck said.

Workforce participation matters, Jones said, because while machinery and automation can make a lot of manufacturing more efficient and productive, it isn’t possible to replace people with software or machinery in the service jobs that make up the bulk of employment. A labor pool that cannot keep up with economic growth limits the ability of businesses to hire, and that restricts an area’s ability to grow, provide economic opportunities for people and allow them to seek better work and increase their incomes.

“The bulk of our economy is not manufacturing, it’s still service. It’s hard to automate service industries. So if we want to expand our economy, then we have to be mindful of the pool of people who can actually join whatever enterprise either grows or comes new to a particular region,” he said.

However, the significant recent growth in Central Washington in the last few years, driven largely by people moving into the region seeking more affordable housing and a lower cost of living, has likely contributed to ongoing labor shortages and made life more expensive for Basin residents, according to Gonzaga University economist Ryan Herzog.

“A lot of people moved to the region over the last two to three years, based off of your housing markets from Pasco and Richland throughout Central Washington,” Herzog said. “And what ended up happening is a lot of people move to the community and use services, but aren’t providing the labor.”

It’s a reflection of a nationwide trend, Herzog explained, and it means there simply aren’t enough people to fill the need for service jobs. A lot of lower-cost areas across the country are facing the same problem as people who discovered during the COVID-19 pandemic they can work from home and decided to relocate their homes to less expensive parts of the country.

“And so, all of a sudden, all of your grocery, leisure, hospitality sectors are just starved for labor because they can’t find bodies,” Herzog said. “It’s a big challenge that I think most of the lower cost of living areas are dealing with right now.”

The influx of people into places like the Columbia Basin has driven up home prices. According to Grant County Trends, the median resale price of a home in Grant County was $335,200 in the fourth quarter of 2022, down from a high of $372,800 at the end of the second quarter of 2022 but nearly $100,000 higher than the median resale price of $248,000 at the end of 2019, right before the outbreak of COVID-19.

By comparison, the median resale price of a home in Washington at the end of 2022 was $567,400, down from a high of $654,500 in the middle of 2022, according to Grant County Trends. Median home resale prices in Benton and Franklin counties, also tracked by EWU, followed a similar trend, falling slightly to $417,000 at the end of 2022, with resale prices nearly identical in Walla Walla County.

Herzog said the lack of labor has made it difficult for farmers to find workers across the region, from grass seed growers along the Washington-Oregon state line to the wheat farmers of Whitman County. It also affects the cost of housing by making it more difficult for contractors to find laborers, and sets into motion something a vicious cycle — lack of affordable housing makes it hard to find workers, which makes it harder to build affordable housing.

It doesn’t help that the Federal Reserve, the U.S. central bank, has been raising interest rates in an attempt to control inflation, which the Bureau of Labor Statistics measured a 6% for the 12 months ending in February 2023.

“That’s a challenge that the whole state, the whole Pacific Northwest, is struggling with right now,” he said.

Meseck said that while there are many good economic indicators in Washington right now, the shrinking labor force, a slight rise in Grant County unemployment figures beginning in late 2022 and reduced hiring of temporary workers all point to a somewhat less promising immediate future.

“That’s usually an indicator when temp agency employment goes up. It means employers are hiring … they basically try out employees to see how they’re working, and if they’re working out, well, they offer them a permanent job with that company. And that’s down right now,” he said.

According to data from the AWB Institute website, unemployment in Grant County in December 2022 was 8.3%, while in Adams County it was 7.6%, compared with a statewide average of 4.4% and a U.S. average of 3.5%.

Herzog said one of the trends he is seeing and intends to explore in more detail in regard to Central Washington is the seeming lack of participation in the workforce on the part of men aged 18-24, many of whom are not going to work or to college with the gusto young men in previous generations did. This is a national trend, he said, and in likely one reason builders and farmers are having a tough time finding workers.

“They are kind of in and out of the labor force. They’re not as committed to what they were in prior years,” he said. “They’re not sure they’re going to college, they are not certain they are in the right job. They’re that marginally attached worker that keeps kind of flip-flopping in and out. They’ll work for a bit, they know they can quit and pick up a job in six months, work for a bit, and quit.”

“They’ve been in and out of the labor force since the start of the pandemic,” Herzog added.

Granular data on labor and employment for parts of Central Washington, like Grant and Adams counties, is hard to come by, Herzog said, because the region’s markets simply aren’t big enough for the Bureau of Labor Statistics to produce in-depth reports on a regular basis. The U.S. Census Bureau tracks it, he said, but it takes time to dig through their data, and he’s not yet been able to do that for Central Washington.

Charles H. Featherstone can be reached at cfeatherstone@columbiabasinherald.com.