A full-scale building boom helped drive the Tri-City unemployment rate to its lowest level in recent memory for May.
The Tri-City unemployment rate fell to 5.3 percent, according to figures released Tuesday by the Washington Employment Security Department. That’s nearly 20 percent lower than a year ago and two-tenths of a point lower than in May.
The local economy has now grown for four years.
Construction-related employment is chiefly responsible for the rosy picture, with 900 new jobs over a year ago, which translates to a growth rate of more than 12 percent.
Ajsa Suljic, regional labor economist, said construction is hitting its stride after a post-recession slump that led to a shortage of homes and other structures. Construction began building momentum in 2014 and has been growing ever since.
The residential sector is particularly affected. Fears of rising interest rates coupled with a shortage of listings is inducing new construction throughout the region.
Mid-Columbia agencies issued 580 permits for new single family homes in the first five months of 2017. That’s comparable to 2016 numbers and well above the 442 permits issued during the same period in 2014, according to the Home Builders Association of Tri-Cities.
The average price of a Tri-City home in May was $262,100, up 5.6 percent from a year ago, according Tri-City Association of Realtors statistics. The inventory of homes for sale fell 20 percent, to 470.
91 Benton County
60 West Richland
45 Franklin County
5 Benton City
The total value of homes permitted through May was more than $172 million. Suljic said it’s unclear if or when the market will reach its peak. The Mid-Columbia typically marches to its own economic drum thanks to the stabilizing influence of federal spending at Hanford.
Suljic said his year is different.
Instead, local economic activity is mirroring what’s happening elsewhere in the state. Washington’s overall unemployment rate was 4.3 percent in May, down from a year ago and comparable to the prior month.
“Is our economy able to sustain the growth and the prices of these homes that are getting built?” she asked.
Residential construction is one aspect. Commercial, including public spending on schools and other civic infrastructure, is a key driver as well.
“A lot of activities are contributing to this,” she said.
According to the May unemployment report, the Mid-Columbia’s civilian labor force grew to more than 134,000 workers with 7,000 actively seeking work.
Administrative and waste services, the category that includes much of the activity related to Hanford, fell slightly, by 100 jobs, to 11,000 positions. Eduction and health services was a growth sector, adding 500 jobs in the past year for a total of 15,100. Food services and dining added 300 jobs for a total of 8,400, a 3.6 percent growth rate.
June employment figures are scheduled for release on July 25.