Editor's Note: What It Takes to Compete

Without more middle-income jobs, Seattle faces a tough climb.
| FROM THE PRINT EDITION |
 
 

In a global competitiveness ranking of nine midsize cities by the Boston Consulting Group (BCG), Seattle has fallen one notch — to sixth place — from 2013 to 2015, and Singapore has overtaken San Francisco to become first. Seattle performs poorly in education, infrastructure and finance. But another reason for its weakness is rising inequality.

While there was a 19 percent increase in high-income jobs in the region from 2005 to 2013, and a more than 5 percent increase in low-wage jobs, the number of workers earning a middle income between $35,000 and $75,000 declined by 7,000. That trend continues, says John Wenstrup, managing director at BCG’s Seattle office, and it hurts Seattle’s standing in BCG’s ranking system.  

We all understand the high human cost of having fewer people with living-wage jobs; what’s less understood is how the high economic costs of inequality  strongly argue for investing substantial sums to reverse the trend.

PROSPERITY: Middle-class jobs raise per-capita income and allow for social mobility — the notion that anybody can get ahead if they just work hard enough. The middle class also happens to be the largest source of the entrepreneurs so important to our region.

HEALTH AND SOCIAL STABILITY: Studies show that communities with high-income disparities tend to suffer more health problems, leading to more homicides, obesity and mental illness. That reduces productivity and the quality of life, which, in turn, can  make it harder for our companies to attract the talent they need. 

RESILIENCE: Today, Microsoft, Boeing, Amazon and the University of Washington account for 30 percent of our jobs and 50 percent of our wages. A decline in fortunes at any one of those organizations, important sources of family-wage jobs, would deal a big blow to the region’s economy. 

So, if middle-income jobs are so important, how do we create more of them?

One answer is to train workers for the jobs that are available today in such industries as maritime, manufacturing, health care and technology. That means preparing our students better for college and vocational schools. Today, only 39 percent of our high school students go to college, putting us 47th in the nation. We must also train workers for emerging needs such as installing and repairing the smart-home systems that will soon connect home appliances to the internet, and providing wellness coaching and other services needed in a health-care system increasingly focused on preventive care. 

Another approach is attracting more national and global companies to the Seattle region in areas such as manufacturing and professional services, as the Economic Development Council of Seattle and King County is seeking to do. These outposts would not only create more middle-income jobs and better anchor us in the global economy, but also would diversify our economy and help us weather future downturns.

Additionally, supporting those middle-income families requires providing reasonable health care, affordable housing, child care and transportation options. All these efforts are expensive, but if they lead to a stronger community and a more robust economy, they will be well worth the investment. It’s been Singapore’s path to a stronger economy. It’s a path we should follow, too.

HEALTH AND SOCIAL STABILITY: Studies show that communities with high-income disparities tend to suffer more health problems, leading to more homicides, obesity and mental illness. That reduces productivity and the quality of life, which, in turn, can  make it harder for our companies to attract the talent they need. 

RESILIENCE: Today, Microsoft, Boeing, Amazon and the University of Washington account for 30 percent of our jobs and 50 percent of our wages. A decline in fortunes at any one of those organizations, important sources of family-wage jobs, would deal a big blow to the region’s economy. 

So, if middle-income jobs are so important, how do we create more of them?

One answer is to train workers for the jobs that are available today in such industries as maritime, manufacturing, health care and technology. That means preparing our students better for college and vocational schools. Today, only 39 percent of our high school students go to college, putting us 47th in the nation. We must also train workers for emerging needs such as installing and repairing the smart-home systems that will soon connect home appliances to the internet, and providing wellness coaching and other services needed in a health-care system increasingly focused on preventive care. 

Another approach is attracting more national and global companies to the Seattle region in areas such as manufacturing and professional services, as the Economic Development Council of Seattle and King County is seeking to do. These outposts would not only create more middle-income jobs and better anchor us in the global economy, but also would diversify our economy and help us weather future downturns.

Additionally, supporting those middle-income families requires providing reasonable health care, affordable housing, child care and transportation options. All these efforts are expensive, but if they lead to a stronger community and a more robust economy, they will be well worth the investment. It’s been Singapore’s path to a stronger economy. It’s a path we should follow, too.

Final Analysis: The Sporting Life in 2017

Final Analysis: The Sporting Life in 2017

Three predictions for the coming year on a new arena, an old arena and the Mariners.
| FROM THE PRINT EDITION |
 
 
 
As every first-year business student knows, a city’s economy is not considered “world class” until said city has erected at least four shrines to professional sports and these shrines remain empty and unused most days of the year. Seattle is knocking on the door of world classiness because it already has KeyArena, Safeco Field and CenturyLink Field up and running. Occasionally. Just one more monument to appease the great mass of athletic supporters and we’re there. Hallelujah!
 
It’s only a matter of time because Chris Hansen, the San Francisco rich guy who wants to build a new arena on First Avenue South and bring pro basketball and pro hockey to Seattle, is this close to getting his way. In October, Hansen revealed that he and his investors are now willing to pay the whole honkin’ bill for plopping a new arena into the SoDo neighborhood a block from Safeco Field. He still wants a piece of Occidental Way vacated and also expects some tax breaks from the city, but that’s how rich guys are. (See: Trump, Donald.) Besides, the people who believe we’re not world class until the NBA returns to Seattle are salivating over this deal because it’s the best deal we’re ever going to get
 
Of course, these same people said Hansen’s previous offer, which would have required that $200 million in public money be plowed into a new arena, was also the best deal we were ever going to get. 
 
Hansen’s decision to pay more for his arena places the sports economy clearly in the local spotlight this year. Heaven knows we could use more opportunities to pay $9 for a beer and see millionaire athletes selling Jaguars and BMWs on TV. It’s the kind of economic shot in the arm that only comes around whenever a sports league is in a coercive mood. 
 
And so, in the spirit of this January issue’s “looking ahead” theme, we offer three predictions relating to the regional economy as the Hansen arena intrigue continues to unfold.
 
Prediction 1: Hansen, who has already spent more than $120 million buying up property in the area of his proposed arena, will persuade the Port of Seattle, his arch nemesis in this melodrama, to fold up its tent and send all cargo-handling operations to Tacoma. That decision will pave the way for so many trendy bars and restaurants with names like Kale & Kumquat or Cobblestone & Wingtip that Hansen will be persuaded to create a private streetcar system to connect Pioneer Square with the burgeoning Stadium District. 
 
Prediction 2: The city-owned KeyArena, whose very future is clouded by the Hansen proposal, will announce plans to house up to 10,000 homeless persons every day. Even on days when the Seattle Storm and Seattle University basketball teams need the building, the city believes the Storm and the Redhawks could use the attendance boost, so it becomes a classic win-win.
 
Prediction 3: The Seattle Mariners, who still don’t like the arena proposal, will channel their hostility onto the field of play — and still not win the World Series. (This is called pattern-recognition analysis.) However, always mindful of improving the fan experience — because it’s not whether your team wins or loses, but whether you’re inclined not to press charges for being gouged by a vendor — the Mariners will introduce several new fan-friendly food items, plus mani/pedi stations in the pricey seats and roving loan officers to assist anyone trying to finance the purchase of hot dogs and sodas for a family of four. 
 
JOHN LEVESQUE is the managing editor of Seattle Business magazine. Reach him at john.levesque@tigeroak.com.