Manufacturing is a bedrock of the state’s economy. It accounts for more than 300,000 jobs and approximately 11% of the state’s total economic output. Those jobs tend to pay above average, too, with an average salary of $80,000.
That’s good news but imagine what it would mean for Washington’s economy if the state doubled the number of manufacturing jobs. What would it mean for communities? What would it mean for young people looking to build a career? What would it mean for families?
Every October, the Association of Washington Business hits the road in a custom-wrapped bus and tours the state’s manufacturers to call attention to the state’s manufacturing economy. This year, part of the message we’re taking on the road is about House Bill 1170, also known as the Washington BEST Manufacturing Act.
The bill, which was approved unanimously by the Legislature this year, calls for a doubling of Washington’s manufacturing jobs over the next 10 years, along with a doubling of the number of manufacturing firms owned by women and people of color manufacturing businesses.
It’s an ambitious and inspiring goal and achieving it won’t be easy. If we’re going to have a chance of achieving it, here are some areas that Washington will need to address.
Protect and continue to invest in Washington’s core competitive advantages. One of Washington’s strongest competitive strengths has been energy costs, which have historically been among the lowest in the nation. Losing this competitive advantage would hurt the state’s long-term competitiveness. Policymakers should continue to ensure this low-cost advantage while not compromising on clean energy and renewable energy objectives.
Prioritize infrastructure investments. Washington has more than $222 billion in unaddressed infrastructure needs, ranging from transportation, energy, water and communications systems. The state should focus on funding these projects to protect and preserve the manufacturing sector’s long-term competitive strengths in Washington state.
Continually benchmark Washington’s tax incentives to ensure the state is competitive in comparison to other states. The state should periodically assess how it performs in relation to other states in areas of tax rates and tax incentives in the manufacturing sector. Benchmark Washington’s tax rates to make sure tax policies remain competitive relative to other states.
Review Washington’s existing regulatory system and determine areas of improvement. A 2015 state auditor’s report laid out areas where Washington can improve the ease by which businesses comply with state regulations. This report should be updated and be followed with a strategy for implementing the report’s recommendations. As part of this process, each year Washington should convene a panel of manufacturing businesses to understand the challenges and hurdles to new investment due to regulatory compliance and permitting processes.
Invest in the next-generation workforce. Even before the pandemic, a shortage of qualified workers was a challenge for Washington manufacturers. Like so many things, the pandemic served to exacerbate workforce challenges, making it more important than ever that employers, educators and state officials work together to inspire young people to pursue manufacturing careers and ensure they receive the education they need to enter the workforce.
There is no single answer but addressing those five areas will help give Washington a chance of doubling its manufacturing base in the next decade.
Can Washington really double its manufacturing base in the next 10 years? Let’s hope so. When manufacturing thrives, Washington thrives.
Kris Johnson is president of the Association of Washington Business, the state’s chamber of commerce and manufacturers association.