Seattle’s economic boom stronger than Tacoma’s | Jon Talton

With the U.S. Open coming to Chambers Bay, and Tacoma and Seattle embarking on a historic seaport alliance, this is a good time to check in on the South Puget Sound economy.

First, the good news.

Unemployment in Pierce County fell to 6.5 percent in March, a welcome relief compared with the Great Recession peak of nearly 12 percent in early 2010.

People are moving there, another conventional sign of better times. The county’s population reached nearly 832,000 last year. A 2013 estimate for Tacoma was 203,446. Both are records.

The Port of Tacoma is recovering from the West Coast labor dispute, with container volumes surging in March.

The Economic Development Board of Tacoma-Pierce County notched some important business recruitment last year. For example, GKN Aerospace agreed to lease space in Sumner to assemble winglets for the 737 MAX. James Hardie Building Products purchased a 47-acre manufacturing plant in Frederickson.

Also in Frederickson, Boeing announced it would build the tail for the 777X.

Most important for downtown Tacoma was winning 1,100 new State Farm jobs, a victory after the loss of Russell Investments to Seattle.

Next, the not-so-good news.

The civilian labor force in Pierce County has shown marked weakness. It is lower now than in the early months of the recovery and doesn’t match the trend of population growth. And it’s happening despite metro Tacoma’s nonfarm jobs finally surpassing their pre-recession peak last fall.

This takes us into the arcane world of the civilian labor-force participation rate, which nationally has fallen to lows not seen since the late 1970s. It is partly because of retiring baby boomers, partly because of discouraged workers who have given up actively seeking jobs.

But the labor force has nearly recovered in Washington and has actually grown in King County.

At a January economic-forecast event, Pacific Lutheran University economist Martin Wurm especially worried about the number of men aged 16 to 24 who had dropped out of the workforce, according to The News Tribune.

Whether measured by transactions, prices or new construction, the residential real-estate market continues to struggle compared with the Seattle area. According to RealtyTrac, the foreclosure rate for Pierce County was 1 in every 678 mortgages in March. That compares with 1 in every 2,089 in King County and 1 in every 1,440 statewide.

Also, for all of Tacoma’s reputation as a gritty manufacturing center, goods-producing jobs have fallen while lower-paying service jobs have risen.

Trouble also looms at Joint Base Lewis-McChord, the county’s largest employer, which could lose 16,000 military and civilian jobs because of the congressional sequester.

All this looks worse in comparison with King County, and especially booming Seattle.

The juxtaposition is unfair by some measures. For example, Tacoma, the state’s third-largest city, is doing better by many measures than Spokane, the second-largest. Seattle is one of a relatively small number of American metros doing very well after the Great Recession, powered partly by global trends.

But proximity makes the Tacoma-Seattle comparison inevitable.

History plays an enormous role. Seattle was the larger city as far back as record-keeping goes. But size alone is a poor metric for prosperity and power. Here some counterfactuals come in.

What if Tacoma, instead of Seattle, had been the jumping-off point for the Klondike Gold Rush of the late 1890s? What if Tacoma had enjoyed ”Bill Luck,” with Boeing and Gates? What if the city had not allowed its downtown retail to be lost to malls and many historic buildings with good bones to be torn down? What if it had snagged the main campus of the University of Washington?

In the real world, Tacoma faces low educational outcomes in an economy that values them over brute force in factories. Adults with a bachelor’s degree or higher were only 24.9 percent of the population in 2013. That compared with 31.9 percent for the state and 57.4 percent for Seattle.

Poverty is a problem, too. Those below the federal poverty level totaled 18 percent in 2013, versus. 13.4 percent in Washington and 13.6 percent in Seattle.

Although Tacoma has some wonderful city neighborhoods, many face crime and gang troubles, especially Hilltop and the East Side.

As a military center, Pierce County sees soldiers and airmen leaving the service and staying in the area, but having persistent problems finding civilian employment.

Only about 3,000 people work in the information sector in metro Tacoma, too small to take advantage of the technology boom that has made Seattle one of the world’s top software clusters.

The tantalizing question is whether affordable Tacoma could become Oakland to Seattle’s San Francisco. Only 34 miles separate them.

The biggest impediment is a 1970 transportation system dependent on a clogged Interstate 5. Workers can easily travel from Oakland to San Francisco on the BART subway, or between Silicon Valley to San Francisco on fast, frequent passenger trains.

Fix that, and Tacoma could see a beneficial spillover. Unfortunately, Pierce County struggles to fund its minimal bus system, Sound Transit trains and buses are inadequate, and the Legislature is deadlocked on a transportation bill that no one would call visionary.

Until then, Tacoma will be an outlier: a major West Coast city that isn’t booming.

Maybe some of the big shots attending the U.S. Open will like what they see and send more business to the South Sound.