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Island County Profile, April 2009

Joe Giannamore, Regional Labor = Economist

4/29/2009

Table of=20 Contents

Economic Overview

Population, Labor Force, and=20 Unemployment

Industry Employment by Age and=20 Sex

Wages and Income

Economic Overview

Links=20 to 64 Island County data sheets

For more = information on=20 Island=20 County, = please see Regional Economists=20 and the Areas They Serve.

Island County=20 has = experienced=20 significant growth since 1990. In fact, between 1990 and 2007, the = annual=20 job growth rate in Island County was 2.2 percent, almost=20 20.0 percent higher than the rate experienced by the state=20 (1.8 percent) and 58.0 percent higher than the rate = experienced=20 by the nation as a whole (1.4 percent).

Consistent with = the overall job=20 growth experienced by the county is the large employment growth in = the=20 construction grouping. Job growth leads to population growth and, = as a=20 result, the demand for housing rises. Between 1993 and 2007, the=20 employment growth rate in the construction grouping was slightly = over=20 4.6 percent per year (statewide, employment in the = construction=20 grouping increased at an annual rate of 3.8 percent during = this time=20 period).

The Island = County economy has always = been=20 heavily weighted toward the services-providing sectors. In 2007, = they=20 accounted for over 86.0 percent of all nonfarm employment. = The=20 goods-producing sectors are responsible for about = 14.0 percent of=20 total nonfarm employment.

Thanks to Naval = Air Station=20 Whidbey (please see below), the largest industry by employment in = the=20 county is government. In 2007, the government sector accounted for = 28.0 percent of total employment. The local government = accounted for=20 almost 70.0 percent of total government employment. The = government=20 sector was followed by the retail trade sector and the = construction=20 grouping, 15.3 and 9.7 percent respectively.

However, while = the naval=20 station somewhat shields the Island County economy, the county = was not=20 immune to the effects of the nationwide recession which occurred = in 2008.=20 The effects of the recession will be discussed further below. =

Outlook

The = military's=20 Defense Base Closure and = Realignment (BRAC)=20 Commission has slated NAS Whidbey as a base = for growth=20 and the base will absorb another 1,000 enlisted in the future. The = base=20 has a net direct impact of $500 million in Island = County.

General=20 Trends

Island County=20 had 16,580=20 nonfarm jobs in 2007, up 50 jobs over the 2006 total of=20 16,530.
However, = preliminary data=20 indicate that total employment in 2008 decreased by 140 from the = 2007=20 total.
If the 2008 = preliminary data=20 hold up, it will be only the second time since 1990 that there = has been=20 negative employment growth (1992 was the only previous=20 occurrence).

Industry=20 Detail

The = goods-producing sectors=20 in the county accounted for 2,280 jobs in 2007, representing=20 13.8 percent of all jobs. The construction grouping is = responsible=20 for about 70.0 percent of all goods producing jobs. = However, the=20 2008 preliminary data indicate the cyclical nature of the = construction=20 industry. The data indicate that 170 construction jobs were lost = to the=20 recession in 2008. This represents a 10.6 percent decrease = from the=20 2007 total.
The = manufacturing industry=20 is virtually nonexistent in Island County. There were only = 670=20 manufacturing jobs in the county in 2007, representing about=20 4.0 percent of all nonfarm jobs (statewide, = 10.0 percent of=20 all nonfarm jobs were in this industry in 2007). In addition, 50 = manufacturing paychecks were lost to the 2008 recession. The = preliminary=20 2008 total manufacturing employment represents a = 16.2 percent=20 decrease from the historical high that was achieved in=20 2006.
The wholesale = trade industry=20 accounted for 190 jobs during 2007. Employment has been stagnant = in this=20 industry since the mid-1990s.
In 2007, there = were 2,540=20 jobs in the retail trade industry in Island County. This sector has=20 experienced steady growth since 1990. The retail trade job = growth rate=20 between 1990 and 2007 was 2.9 percent. Like many = industries, retail=20 trade lost jobs to the recessionary economy in 2008. Island = County experienced a = decrease of=20 100 retail trade jobs in 2008. This represents the first = year-over-year=20 decrease in this industry since at least 1990 (the first year = for which=20 comparable data exist).
The = transportation,=20 warehousing and utilities grouping accounted for 270 jobs during = 2007.=20 While this sector accounts for less than 2.0 percent of = total jobs=20 in the county, between 1999 and 2004, it experienced an annual = job=20 growth rate of 20.1 percent. However, since 2004, = employment in the=20 industry has stagnated.
After = experiencing=20 relatively strong employment growth in the early 1990s = (14 percent=20 average annual growth between 1990 and 1992), employment in the=20 information and financial activities sector has been stagnant = since=20 1992. In 2007, employment in the industry fell to the 1990 level = of 970.=20
Due to the = aforementioned=20 high population growth rate, and the resulting increased demand = for=20 government services, government sector employment has grown=20 substantially over the last 17 years. Between 1990 and 2007, = government=20 employment grew at a 1.5 percent annual = clip.

Island County employment is projected to grow at an annual rate of=20 1.2 percent between 2006 and 2016. The state employment job = growth=20 rate is expected to be 1.4 percent over the same time period. =

In the year 2011, = it is=20 expected that 17,570 people will have jobs in Island = County, a 1.2 percent = annual=20 increase over the 2006 total. Industries that are expected to = experience=20 the highest average annual growth rates between 2006 and 2011=20 are:

Education and = health=20 services (2.8 percent),
Information=20 (2.6 percent), and
Professional = and business=20 services (2.3 percent).

Between 2011 and = 2016, the=20 annual rate of growth is expected to increase to 1.3 percent = per=20 year. In 2016, the number of workers is predicted to be 18,750. = The=20 services sectors will be responsible for 16,420 of these jobs. The = largest=20 annual employment gains are expected to occur in food = manufacturing=20 (2.7 percent) and education and health services=20 (2.3 percent).

Population, Labor Force, and = Unemployment=20

Population

Island County population was estimated to be 79,300 in = 2008, which=20 makes it the 14th largest county in the state.
Of the 2008 = population=20 total, 53,325 were living in unincorporated areas of the=20 county.
The largest = incorporated=20 city in Island = County is Oak Harbor, with an = estimated 2008=20 population of 22,980. The second largest city is Coupeville, = with a=20 population of 1,950, followed by Langley at = 1,080.
OFM predicts = that the=20 Island=20 County = population=20 will grow at a 1.4 percent annual rate between 2008 and = 2030 =96=20 about 67.0 percent higher than the national rate and=20 17.0 percent higher than the state rate.
The 2030 = projected=20 population of Island County is 107,126. =

Age

The Island = County population is = slightly=20 older than that of the state and the nation.
In 2008, = almost=20 28.0 percent of the Island County population was = over the age=20 of 55. Compare this to the state (23.3 percent) and = national=20 figures (23.4 percent).

Race and=20 Ethnicity

In 2008, the = Island County=20 population was 83.1 percent White non-Hispanic. The = Island = County population is = much less=20 diverse than the state (76.8 percent White non-Hispanic) or = nation=20 (66.4 percent White non-Hispanic).
Asian/Pacific = Islanders, at=20 5.5 percent, represent the largest minority population in = the=20 county. Those of Hispanic origin follow at=20 4.8 percent.

Educational=20 Attainment

Data from the = 2007 American=20 Community Survey (ACS) show that Island County residents are, in = general,=20 highly educated. Over 68.0 percent have at least some = college=20 education. The state (63.7 percent) and the nation=20 (54.4 percent) lag behind.
Only = 5.7 percent of=20 Island=20 County = residents do=20 not have a high school diploma. This compares favorably to the = state=20 (10.7 percent) and the nation as a whole=20 (15.5 percent).

Unemployment

After = experiencing four=20 consecutive years of decreasing annual average unemployment rates = from=20 2004 to 2007, the Island County annual average = unemployment=20 rate increased to 5.8 percent in 2008. In addition, the = unemployment=20 rate reached 9.1 percent in early 2009 as the recession hit = full=20 force. As a result of the recession, in 2009, Island = County will likely = experience its=20 highest annual average unemployment rate since at least 1990 (the = first=20 year for which comparable data exist). The previous high of=20 7.6 percent occurred in 2003.

In 2008, = there were 33,340=20 Island County residents in = the labor=20 force. Of these, 1,920 were unemployed.
The = Island = County unemployment rate = has been=20 at least as high as the state unemployment rate since 2000.=20

Industry Employment by Age and = Sex

LED

The Local = Employment Dynamics=20 (LED) database, a joint project of state employment departments = and the=20 Census Bureau, matches state employment data with federal = administrative=20 data. Among the products is industry employment by age and sex. = All=20 workers covered by state unemployment insurance data are included; = federal=20 workers and non-covered workers like self-employed are not. Data = is=20 presented by place of work, not place of residence. Some = highlights=20 include:

During the 2007 = calendar year,=20 56.2 percent of those employed in Island County were female,=20 43.8 percent were male.

Industries with a = large male=20 majority were:

Construction=20 (84.6 percent),
Transportation = and=20 warehousing (74.7 percent), and
Information=20 (65.8 percent).

Industries with a = large female=20 majority were:

Health care = and social=20 assistance (82.5 percent),
Finance and = insurance=20 (79.0 percent),
Management of = companies and=20 enterprises (68.6 percent),
the other = services category=20 (67.2 percent),
Educational = services=20 (66.7 percent), and
Accommodation = and food=20 services (66.1 percent).

Wages and Income

Average Annual = Wage

In 2007, = Island = County averaged more than = 15,800=20 jobs covered by unemployment insurance, with a $481 million dollar = payroll.

The county=92s = annual average=20 wage was $30,365, well below the state average of $43,904. In = 2007, the=20 county ranked 24th in total covered wages.
Wages of those = involved in=20 the management of companies and enterprises were the highest at = $60,815.=20 The next highest wages were paid in manufacturing ($43,604), = followed by=20 wholesale trade ($41,716).
At the other = end of the=20 spectrum were wages in accommodation and food services = ($12,903), arts,=20 entertainment and recreation ($14,161) and other services, = except public=20 administration ($14,877).
In 2007, the = Island = County median hourly = wage was=20 $16.27, ranking the county 20th in the state. The state median = hourly=20 wage was $18.65.

Personal and = Per Capita=20 Income

In 2006, personal = income in=20 Island=20 County was = $33,750.=20 Island=20 County lags = behind=20 both the state average ($38,212) and the national average=20 ($36,714).

Household and = Family=20 Income

In 2007, the = Island County median household income was = $49,022, less=20 than the state at $52,583, but higher than the U.S.=20 figure of $48,451.

Also in 2007, = 9.3 percent=20 of the Island County population was = below the=20 official poverty line =96 an increase of almost 33.0 percent = since=20 1999. The Island County poverty rate does = compare=20 favorably to both the state (11.9 percent) and national = figures=20 (13.3 percent).