Northwest Now | Pierce County Economy 2022 - Jan 21 | Season 13 | Episode 17

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Thank you.

>> Tom Layson: How in the world did the economy boom while Boeing was in a tailspin, a global pandemic raged, and people walked away from their jobs?

That was 2021's story.

But in 2022, it's going to be about trying to hire people, an ongoing supply chain problem, and, maybe later, a cooling economy as the fed steps in to raise interest rates.

Here, in Pierce County, the issues remain much the same, with workforce issues being front and center.

Our annual program on the Pierce County economy is next on Northwest Now.

[ Theme Music ] While the housing market in the South Sound remains high, there's a lot of commercial development, too.

Including some new warehousing complexes going up in the Puyallup area, and up on the hilltop where the old News Tribune building used to be.

Amazon is opening a new sorting center in Fife, creating 500 jobs.

Another developer is putting 2 million square feet of warehouse space along I-5 in Milton.

In Lakewood, Tesla may be looking for space and workers to add to what it already has in Fife.

In Tacoma, two big new apartment complexes are up, along with plans for new warehouses on long-vacant BNSF property along South Tacoma Way.

Also in Tacoma are several new startups that focus on real estate data, environmental cleanups, and firefighting technology.

Silverback Marine and SAFE Boats are bringing back the boat-building industry at the Port of Tacoma.

And speaking of the Port of Tacoma, it just received a nearly $16 million grant to add additional container storage capacity.

A Band-Aid to get us hopefully closer to building out true high-speed freight mobility in this region.

And speaking of freight mobility, this summer work will start on a new stretch of roadway that'll connect Interstate 5 and State Route 509.

Meanwhile, a CareerBuilder study says Tacoma ranks number three among midsize cities for job openings, with the most number of openings in the healthcare industry.

As Northwest Now contributor, Linda Byron, tells us now, meeting that demand for healthcare workers is behind the construction of Bates Technical College's new $43 million Center for Allied Health Education.

>> Linda Byron: Bates Technical College is still moving into its shiny new Center for Allied Health Education in Tacoma.

But already, classes are in full swing.

>> A quarter of an inch?

>> Yeah.

>> So that would be the depth.

>> Linda Byron: These students are practicing wound care on a mannequin, part of their intensive hands-on training to become LPNs, licensed practical nurses.

In high demand during these challenging times.

>> Mr. Swarens: We need to try and get the -- get the students through so that they can go and help the rest of the -- and sort of give a breather to the nurses that are working those 16-hour shifts and five days a week.

>> Linda Byron: Healthcare is extremely important to Tacoma's economy.

It's the second-largest employer behind city government.

After graduating from the two-year program, many students slide right into a good job.

>> Mr. Swarens: Usually, the starting wage for an LPN is about $28 an hour.

So it's almost double the minimum wage.

So it's a good livable wage.

>> Is it odorous, malodorous, anything like that?

>> Linda Byron: Jazmine Marion says this training is invaluable to her long-term career goal of becoming a labor and delivery nurse.

>> Ms. Marion: I came here because I was trying to get into the RN program.

But then I was, like, you know what, let me slow things down and then I'm just going to try the LPN route.

And so I just came here to Bates because I heard that it was a really good program.

>> Is it pink?

Is it red?

Does it look like healthy tissue?

That's really what we're looking for, right?

>> Linda Byron: Surprisingly, COVID isn't deterring Jazmine from entering healthcare.

In fact, it's just the opposite.

>> Ms. Marion: It's scary, but, you know, I just think about everybody because, you know, I've already had a family member that's already, you know, passed away from it.

And we didn't get to see him.

And, you know, being on the other side, like, maybe I can be able to be the other side of the nursing to be able to, you know, be comforting and everything.

>> Linda Byron: Bates Technical College has been around for eight decades.

But the new medical training center is important on two fronts.

It's helping to revitalize the city's core while offering more students skills-based education at a reasonable cost.

>> I would just -- >> Block that right there, too.

>> Yeah, do you see that?

>> Mm-hmm.

>> Yeah.

>> Linda Byron: Bates offers the only brick and mortar hands-on training program in the country to become a denturist, a person who fits and makes dentures.

>> Mr. Al-Tameemi: The purpose of the denturist is to restore the function, the chewing function in the mouth, and also to restore aesthetics.

And aesthetic, when we talk about aesthetic, we talk about self-esteem, confidence, social life.

>> Is there any discomfort when -- or anything sharp feeling when I put that in there?

>> Linda Byron: Dental hygienist, Sarah Leutke, of Poulsbo enrolled after seeing an unmet need in nursing homes, residents losing teeth and going without dentures.

>> Ms. Leutke: It's huge.

Being able to masticate your food.

There's studies showing that just the chewing motion helps with the cognitive ability of patients.

>> Linda Byron: Even before they graduate, these denturists in training are helping people.

>> Mr. Maziar: This school makes the best dentures.

>> Linda Byron: A former prison guard who lost six teeth when he was struck by an inmate, Scotty Maziar, is here to get a full set of dentures at a cost of $800.

Compared to the 6000-plus a dentist charges.

>> Mr. Maziar: Right now, I have a distraction in my mouth, and it's not very good for folks that I like to talk to and stuff.

So I know that when I get done with my nice teeth, I'm going to be able to be more confident and not scare a lot of people.

So I'm pretty -- I'm pretty jazzed.

>> Linda Byron: Bates's new medical training center is a win-win-win.

Students leave knowing they can land a good job.

Patients leave with a brand-new smile, and Tacoma has a shiny new face smiling down from the hilltop.

For Northwest Now, I'm Linda Byron.

>> Tom Layson: Let me note that Bates Technical College is KBTC's licensee.

On a related note about education in Downtown Tacoma, the UWT's massive new Milgard Hall is also being built right now and scheduled to open early next year.

We do this program every year in advance of the Tacoma-Pierce County Chamber of Commerce's Horizons Breakfast.

Where local business leaders get a read on the past year's economic data and a preview of the year ahead.

Part of that program is the reporting of the Pierce County economic index that I help economist Dr. Neal Johnson present every year at the Tacoma Convention Center.

Because of COVID, though, again this year the program will be virtual.

The good news is that you can easily register for next week's program at tacomachamber.org.

Joining us now are outgoing Tacoma-Pierce County Chamber of Commerce President and CEO, Tom Pierson; Pierce County Economic Development Director, Betty Capestany; Tacoma-Pierce Economic Development Board President and CEO, Bruce Kendall; and Elly Walkowiak, the Assistant Economic Director of the City of Tacoma.

Welcome, all of you, to Northwest Now.

Great to have our annual conversation about the state of the Pierce County economy.

I want to start with a little bit of an icebreaker here.

And, Tom, we'll start with you.

From your perspective, what are some of the good things, some of the wins, that we've seen here in Tacoma-Pierce County?

>> Mr. Pierson: Well, really quickly, one of the big pieces is the 167 gateway project, 509 and 167.

Getting that kicked off.

That's $2 billion and so we're going to be under contract -- we're under contract in construction.

Second piece would be the focus on small business, and, really, the focus on the BIPOC side of the small business.

And the third thing I would add in is the certainty for businesses.

And when I talk about the Tideflats in terms of the certainty in regulations down there.

And we see at least a $500 million project that's going to be kicking off.

That's going to be great for climate change, great for clean energy, and our environment.

>> Tom Layson: And that was a long process of regulation and what the framework was going to be for the types of industries and how that Tideflat area, which is industrial use can be used.

>> Mr. Pierson: Absolutely.

>> Tom Layson: Yeah.

>> Mr. Pierson: And it's a big win.

>> Tom Layson: Good.

>> Mr. Pierson: And we'll see more from that.

>> Tom Layson: Betty, Pierce County.

You have the County perspective.

What are things that over the past year have been wins in your book?

>> Ms. Capestany: So big wins in our book were during the pandemic I think everyone realized the impact to small business and how that's really the major employer for all of our counties.

And so the programs that were established to help those through the CARES Act and the American Rescue Plan, but also the resilience they're having.

I mean, there's some really cool entrepreneurial stories that are spinning out of Pierce County companies and doing things in real innovative ways.

I also think that, kind of tapping on Tom's -- the creative partnerships because we learned to work across silos, but also with nontraditional partners.

So bringing in people like the Korean Women's Association, [inaudible], Black Collective, Urban League, Asia Pacific Cultural Center, to reach their business network.

Which they normally were more human service focused, so bringing them into that business arena.

We're still seeing all across the county development and a lot of people investing in Pierce County.

And that investment ties to what the consumers want, which is a lot of the products to the door.

So we have a lot of industrial.

>> Tom Layson: Logistics.

>> Ms. Capestany: Logistics.

Almost 4 million square feet just in the Frederickson area alone, currently, in the permit and construction system.

>> Tom Layson: Since I have you here for second, before we go to Bruce, you mentioned the federal money.

I think people always want to -- they feel like sometimes federal dollars are kind of being shot into outer space.

Was it effective?

Were the Acts and the money that was spent to help and support small business -- is your experience here, and you can talk about this collectively.

Was it a win?

Did it work?

Did it save businesses?

Was it effective?

>> Ms. Capestany: So from the County's perspective, I would tell you yes.

Obviously, I have a vested in that.

But Pierce County delivered $46.5 million to small businesses; 70 percent of them were minority, veteran, and women-owned businesses.

All small businesses in that process.

That was to help them survive during the CARES part, and now we're investing into helping areas that need it most for the future.

I think if you take our areas in addition and, really, having an executive and a council that have been business owners, past or present, that understand business and could pivot.

If you take us across any county in the country, I don't think anyone's delivered that much work.

And we've also had another $111 million done for the human services and public health.

And that coupled with Tacoma and others, huge investments that went directly to help people survive.

>> Tom Layson: Bruce, Economic Development Board.

What are the things that you've looked at this year and said, yeah, that was good?

>> Mr. Kendall: Yeah, well I would -- I would just add to what Betty just said.

That from a small business perspective we did things we'd never done before with grant programs using federal dollars.

A good use of federal dollars that came through the state, in addition to what the county was doing and the city was doing, the Chamber were doing.

We, for the first time ever, were getting cash directly from the government into the pockets of small business, and very small businesses in many cases.

And that's the best kind of government program you can imagine from a business's perspective.

Yes, they had to have an application that was strong, but the money went straight to them and there was -- and the overhead to us was zero.

I mean, we didn't take a cut out of that.

A big win.

So I'll just -- I'll say this, in the technology space we've been talking for years about what's going to happen as we build a technology base in this community.

And last year, I think we can safely say we arrived at a new level.

We're not at a hyper level yet, but we're at a very important level where we have companies like Nomatod [phonetic], which has been spun out of the University of Washington Tacoma School of Engineering and Technology.

You've got the Benaroya Data Center in Puyallup, which is a node on the World Wide Web.

And demand for its use, particularly as e-commerce becomes larger, is bigger than ever.

And they're right here invested in this community.

And then Infoblox, which came in a couple years ago and bought a local company.

They continue to grow as fast here as they are in their home state of California.

So that's all happening in Tacoma-Pierce County on the tech side, which are big wins for us.

>> Tom Layson: And we're going to circle back to tech and broadband because that is so huge.

But I want to hit the City of Tacoma, specifically in the city limits, which I know is your responsibility.

What have been the things that you looked at and said that was good for 2021?

>> Ms. Walkowiak: There were many, many good things.

And I'll focus on the real estate investment side of the house.

First of all, the Convention Center Hotel, the new Marriot downtown, that's a $172 million project in the city core.

It really will help attract many more conventions, which will help small businesses throughout the downtown.

Adaptive reuse was a really big theme.

And that was looking at existing buildings and finding new uses for them.

I'll give you many examples.

Our pride and joy, of course, is the sale and the reconstruction of old city hall, the renovation of it, which is our iconic landmark in the downtown.

There were other things.

The Washington Building, formerly an office building, will now be mixed-use, primarily multi-family residential, that will open this spring.

In addition, there are several buildings in the downtown along the 11th to 12th side of Pacific Avenue.

These are people coming in from Spokane and they're renovating the buildings.

These aren't always people that are local, they're coming from far and wide.

Another example is MJR from Kirkland, Washington, acquired the Tacoma Financial Center.

They're going to invest in that and make that even more competitive in the office space.

So I do want to mention that office space is not dead.

We're really excited with the renovations in 909 A, the new TOTE headquarters, GSA coming into the Columbia Bank Building.

And to support industrial, so exciting that the Burlington Northern Santa Fe site has been acquired by Bridge.

They will now construct 2.3 million square feet of new logistic space.

>> Tom Layson: On South Tacoma Way, there?

>> Ms. Walkowiak: Yes.

Absolutely, a wonderful win.

>> Tom Layson: I'm just going to throw this out, a piece of meat on the table.

We know each other well enough, feel free to speak.

I would have lost a $100 bet a year ago about the demise of Boeing and the global pandemic tanking the economy.

I would have.

What's your explanation for how resilient we were?

I know we all think Pierce County is great, but it has to be something more than that.

Is it fed stimulus?

Is there too much money sloshing around?

How did -- how did that happen?

>> Mr. Pierson: Well, I think one of the answers is that if you look at Tacoma-Pierce County, it is -- and Bruce can -- I mean, he lives in this world in terms of where are people looking to not only live, locate, invest.

Tacoma-Pierce County is the place.

I mean, this is the -- we have this unique mix of being big enough but being small enough, and being close to logistics.

Where, I mean, you know, we talk about, you know, develop and housing and whatever else, we have cranes.

We actually have this new bird in downtown, it's called a crane, and it's been taking over in the downtown and throughout our region.

And so I think those -- it's the right mix.

People want to be in Tacoma, want to be in Pierce County, and that's part of the answer.

>> Tom Layson: You ought to work for the Chamber of Commerce.

[ Laughter ] >> Ms. Walkowiak: I would agree with Tom.

Talking about the multi-family sector, right now in the pipeline we have 3100 units that are going to be under construction and completed within three years, and that's amazing.

So what that does is it brings more people into our community.

The population alone in 2019 was about, let's see, 213,000 people.

We're now at 221; 8000 people growing in two years' time during the pandemic, which is astounding.

>> Tom Layson: So here comes home Tacoma.

Will that be a good thing to get some of that missing middle housing into the mix?

>> Ms. Walkowiak: The City is trying to figure a way to enhance that.

For some, it'll be a win, for some, it'll be more challenging.

But the idea is how can you use infrastructure much more effectively and provide the services that people need.

>> Tom Layson: Infrastructure, great.

Reaction to the passage of the Infrastructure Bill?

My eye went right to digital and high-speed cable and netcon activity.

Did anybody else zoom in on that and go, like I did, oh, finally?

>> Mr. Kendall: Well, yes, and yes, and yes.

So it's that and it's roads and it's transit and it's a whole lot of other stuff.

That is huge.

And as that gets spent, as that spend happens on a state-by-state basis, we will see billions of dollars of investment in the Puget Sound area, which includes Pierce County.

And so that is a different kind of federal -- it's more of a traditional kind of federal stimulus, an infrastructure bill, as opposed to the pandemic direct payments to businesses -- small businesses.

So this is going to impact everybody in a positive way.

It's also a lot of jobs to build that infrastructure out, so it's very exciting as that comes rolling out.

So kudos to Congress.

We don't often say kudos to Congress.

They did a good job on that one.

>> Tom Layson: Betty?

>> Ms. Capestany: And maybe coupled with that, Pierce County has actually invested 15 million of the America Rescue Plan to be matching, so it hopefully gets providers in to do the gap.

Because you know the areas that aren't served, there's a reason they're not served - because it costs too much.

>> Tom Layson: Yeah.

>> Ms. Capestany: And so we just want to make sure -- especially, we found during the pandemic those that needed it most.

Whether they need it for school, whether they need it for their jobs, whether they need it for a medical appointment, they didn't have that connectivity.

And so we're working really hard to figure out the areas in Pierce County that need that infrastructure and what we can do to put all those pieces together to make it happen.

>> Tom Layson: And that, of course, feeds this new way of working, where people can make a choice to live somewhere and engage in some of the tech that we're seeing and come to Pierce County for all the good things.

>> Ms. Capestany: And the next generation into the workplace, they're digital tech natives.

So they're going to want jobs that tie to that environment.

>> Tom Layson: All right, you said it.

Forget about the new generation.

Where in the heck has the old generation gone?

Let's talk about the Great Resignation and is it real in Pierce County?

What are we seeing?

What are businesses telling you?

>> Ms. Capestany: Okay, so -- >> Mr. Kendall: I think it's -- >> Ms. Capestany: Oh, go ahead.

>> Mr. Kendall: Sorry, Betty.

I think it's "the Great Hesitation."

I don't think it's the Great Resignation.

I think people are waiting and seeing.

People who weren't happy, for whatever reason, with the job they had -- and maybe it wasn't paying enough, maybe the commute was too long, whatever it was, they're deciding.

I've got options now, because it is a tight labor market, and so I'm looking.

I don't think those people are out of the workforce forever.

They're looking for better opportunities.

So what does that say to employers?

You've got to step up.

And our employers are.

If you look at average wages, benefits, the technology that pretty much every company is investing now to make workers more efficient.

Whether they're working from home or they're coming in part-time to the office or the factory floor, that's huge.

And so I think it's a hesitation not a resignation.

>> Ms. Capestany: So maybe coupled -- I do agree with everything Bruce said.

But I actually went back and looked at my notes, and in 2008 a futurist said in the next 24 years the largest generation in the workplace will be retiring.

Well, then you had 2008, 2009 happen.

That was the financial meltdown, so their portfolios so they had to stay in longer.

So part of that were coupled with the largest generation that was in the workplace retiring.

>> Tom Layson: So there's a pent-up demand for quitting.

[laughs] >> Ms. Capestany: And the -- you know, the generation right after that is a smaller number.

So now you add the Millennials and the others in, and they want different kinds of work.

Of which I think Pierce County is perfectly situated for, whether it's online kind of work, whether it's transforming traditional companies, using tech.

And even like the industrial warehouses we talked about.

They aren't like big boxes that nobody's in, they're high-tech with lots of employees in them.

It's just totally transforming how we do business.

>> Tom Layson: Speaking of the Great Resignation, Tom, you're on your way out of The Chamber of Commerce after 10 great years.

And I want to publicly thank you for the support you provided to Northwest Now and the great insight you've provided over that time as well.

How do you see it?

And is it helpful or hurtful to attract new companies if -- you know, with that labor force situation?

Do we have something that we can share that's unique among other communities?

We have a lot of educational institutions who are providing, you know, a skills upgrade.

How do you see it?

>> Mr. Pierson: Yeah, I think it -- I think we actually have some opportunities to just -- I mean, we've talked about our trade schools and, you know, whether it's four-year or two-year schools.

You look at SAFE Boats, Silverback, you know, we actually have a marine -- or marine businesses now building boats.

And they've coupled up with our schools to be able to provide them with that workforce, and so that's why they're locating here.

One of the reasons, right?

So, I mean, there's another, I don't know, 100 jobs, $100 million coupled between the two of them.

But it's that connectivity into our technical and training schools that will help them get that workforce.

>> Mr. Kendall: And I'd rather it be us than the other guy.

The other guy are the states -- and the other people are the states where people are leaving.

People are still moving here.

Even though there's a strain on the labor force for all the reasons Betty and I talked about in terms of supply, we're gaining population, to Elly's point, across the county.

And so how are those people going to work?

Where are they going to work?

And companies see that and they say I want to tap into that.

And before the recession -- before the pandemic, excuse me, we had a lot of people commuting out.

>> Tom Layson: You just read my mind.

>> Mr. Kendall: There we go.

>> Tom Layson: It's low-hanging fruit.

>> Mr. Kendall: They're right here.

>> Tom Layson: It's so easy to convince people.

>> Mr. Kendall: And they're working from home now.

>> Tom Layson: Yeah, to take a gig that they don't have to drive for, isn't it?

>> Mr. Kendall: Exactly.

Exactly.

>> Mr. Pierson: And that's where we see those companies to our region, instead of -- and there's pressure in Seattle and other places within our geographic to have companies be located here.

>> Tom Layson: Yea.

And I would say you could offer somebody a fairly equivalent job for close money in Pierce County instead of banging up 167 every day.

They're taking it.

>> Ms. Capestany: And some are looking at skillsets.

So, like, a manufacturer dealing with eyeglass lenses, they couldn't find the talent.

What they did was then they went out to manicurists and sushi because they have attention to detail in how they do that.

So there's a lot of skillsets.

And we're working, like, with WorkForce Central to figure out upscaling, rescaling opportunities in the city and the county and others.

To try to figure out what are those skillsets or those clusters, and how do we help our population to reskill to be able to access those jobs of the future that are needed.

>> Ms. Walkowiak: So, Tom, I'd like to add one more item, which isn't exactly the labor element, but these are different ways of working.

It's a creative way of looking at enabling the ecosystem.

And I'll use the example of the Minority Business Development Agency who's working with Wash Dot [phonetic] and Sound Transit on a mentor protegee program.

These are primarily for minority- and women-owned businesses.

And what they'll do is they will couple them with prime construction contractors so that they enable their businesses, ultimately, and can get, you know, the skills on the job as well.

They've been so successful.

And BDA, I should say.

And they've linked 66 construction -- 66 minority firms with prime contractors that really resulted in $32 million of contracts for these firms that would not have otherwise happened.

So that's -- those connections, those linkages, are very critical.

>> Tom Layson: Mm-hmm.

And I'm glad you brought that up.

I know a lot of -- all four of you have been heavily engaged in the diversity and inclusion piece of economic development here in Pierce and Tacoma.

We've got about a minute and forty-five left.

I know there's a lot there.

Tom, maybe you could just briefly hit that, and then Betty too.

>> Mr. Pierson: Yeah, and we'll probably go back and forth.

One is through Spaceworks we started up Black Business Accelerator, which is a cohort with 14 businesses starting up, getting funded, and starting their businesses.

The other is Pierce County's business accelerator, small business accelerator focused on the BIPOC community.

Again, we've got 69 folks that have come through that and are going through a funding process, working their businesses.

With another goal of 130 more folks that are going to come through that.

But I'll leave that to Betty to pick up because it's Pierce County's, you know, lift to do this.

>> Tom Layson: I know you've been working a lot.

>> Ms. Capestany: Right.

Right.

So we partnered with the Chamber and others in that process.

But I think the cool piece of the equation is usually on entrepreneurship you go through the training and you're off the door.

We actually -- the County through [inaudible] money will match -- or rescue plan monies will match up to $10,000 in capital.

So then they have a capital infusion, and so many of them are raising that 10.

And we do a rent subsidy for a year up to $500 a month.

So it helps them get started.

But the mentorship, professional services, all those things to really help our BIPOC community be successful.

And we know entrepreneurship and wealth are where it's at for the future.

>> Tom Layson: Bruce, last 20 seconds.

The importance of planting seeds and, hopefully, catching the next Amazon and growing it here.

>> Mr. Kendall: Got to plant them, and I think we have planted them.

And we -- and I should -- this is a good question.

Our caseload is up this year, well over last year, in terms of inquiries coming into the office from companies across the board.

Whether it's office, technology, manufacturing, distribution.

And so we will land some of these folks; they're still -- they're here kicking tires.

And we'll grow some of our own as well.

>> Tom Layson: Great.

Great conversation.

I thank all of you for coming to Northwest Now.

>> Ms. Capestany: Thank you.

>> Tom Layson: This economy sure has defied all odds.

The bottom line?

Even with higher interest rates, households are forming and there's lots of pent-up demand out there.

I hope this program got you thinking and talking.

To watch this program again or to share it with others, Northwest Now can be found on the web at kbtc.org.

And be sure to follow us on Twitter @NorthwestNow.

Thanks for taking a closer look on this edition of Northwest Now.

Until next time, I'm Tom Layson.

Thanks for watching.

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