Oct. 6, 2008 at 2:06pm

State forecast dims outlook

Washington payroll employment declined at a 0.5 percent annual rate in the second quarter of 2008, following a 2.9 percent increase in the first quarter, according to a recent Economic and Revenue Forecast Council report. Manufacturing employment declined at a 0.7 percent rate in spite of a 3.5 percent increase in aerospace employment. Manufacturing employment other than aerospace declined at a 2.3 percent rate.

Construction employment fell at a 6.6 percent rate in the second quarter. Residential building and related special trades employment plunged at a 13.9 percent rate while all other construction employment edged up at a 0.1 percent rate. Natural resources and mining employment, while small, fell at an 8.2 percent rate in the second quarter as both logging and mining declined.

Software employment increased at a 7.4 percent rate, but other information employment declined at a 2.6 percent rate. Also healthy in the second quarter were leisure and hospitality, which was up 2 percent, and professional and business services, which was up 1.7 percent. Education and health services declined at a 1 percent rate and financial activities employment fell at a 2.3 percent rate.

All totaled, the Washington State Economic and Revenue Forecast Council reduced the General Fund revenue forecast by $529.3 million.

The national outlook is weaker than assumed in June. National employment continues to decline and income growth has slowed. Financial market turmoil has increased and the housing market continues to decline. The outlook for the Washington state economy is also weaker, most notably in the areas of construction and housing. 

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