Whatcom County’s economy hummed along in 2017, creating opportunities for individuals and businesses.
Taking a break from the retail tidbits normally in this column, I spent some time looking back at the biggest local business stories in the past year. A theme quickly developed that was different from recent years.
In 2015 and 2016, uncertainty was in the air, including the Haggen upheaval, the closure of CH2M Hill and the potential closure of the Intalco Works aluminum smelter near Ferndale. Those events were mixed into an economy that was also showing a few bright spots as it recovered from the recession.
This year, the top stories centered around signals that the local economy is moving beyond the recovery stage.
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Just look at the changes at Alcoa Intalco aluminum smelter near Ferndale. In 2015 and 2016, low aluminum prices and other factors threatened to shut down the facility, costing this area about 450 living-wage jobs. In 2017, Intalco hired 263 people, increasing its headcount to 697, said Laura McKinney, a spokeswoman for the facility. Aluminum prices have bounced back in a big way: When Alcoa first announced it was planning to idle the Intalco smelter in November 2015, aluminum prices were around $1,400 a metric ton. Just before Christmas 2017, the price was hovering near $2,150 a metric ton, according to the London Metal Exchange.
Here are some other big economic changes that happened this year, in no particular order. Next week, I’ll write about some of the 2018 trends to watch for in the local economy.
Unemployment down, wages up
After a sluggish start in the first quarter, the local unemployment rate dropped below 5 percent and stayed below that level for nine straight months through at least November. The last time Whatcom had a stretch of under-5 percent unemployment this long was in 2007 and 2006, the only other times it has happened since 1990.
Much of the job growth came in construction and manufacturing, two industries that tend to pay above the average wage in Whatcom County. That led to a rise in average wages in the first half of 2017. It is unclear at this point how much impact the low unemployment rate has had on pay raises for workers.
Work on the waterfront finally gets going
After years of clean-up work and little other activity, construction work finally got going in 2017 on the Waterfront District, formerly home to a Georgia-Pacific pulp and paper mill on Bellingham’s downtown waterfront. Current projects under way are Waypoint Park, two city streets and the finishing up of the Granary building. The Port of Bellingham also is finalizing the design for the rest of the district, is seeking public input and is expected to make a decision in February.
As the streets and some infrastructure are finished next year, the next step will be how the private sector and the public responds. Will the tenant spaces start filling up at the Granary building? Will the public come check out the new park? After decades of the site basically being off limits to the public, it will be a chance for some to see Bellingham Bay from a new point of view.
Plenty of waterfront economic activity took place beyond redevelopment planning. All American Marine and Itek Entergy moved into bigger facilities, Bellingham received its first shipment at the shipping terminal in more than 17 years and a major cleanup project got started at the Fairhaven Shipyard site near the Bellingham Cruise Terminal.
Cherry Point coal terminal project goes away
In February, developers of the proposed coal terminal at Cherry Point withdrew their permit applications, essentially closing the book on the project.
The estimated $700 million project had been debated for years, pitting those who felt it would increase train traffic and pollution against those citing the need for living-wage jobs.
Home prices, rent jump
For the second straight year, home values rose more than 10 percent, driven by low inventory and high demand.
Whatcom County homes appreciated 12.7 percent at the end September compared to a year before. At the end of the third quarter in 2016, home values had jumped 10 percent compared to the third quarter of 2015.
Those jumps also led to spikes in rental prices, making it difficult for many to find a place to live here. A bit of a construction boom has followed, leading to hundreds of units under construction and expected to open in 2018.
Mid-size companies making bigger moves
Several mid-size companies had solid performances in 2017 and are looking to continue in 2018.
Superfeet and Chuckanut Bay Foods announced plans to build bigger facilities, while high-tech companies like Emergency Reporting and Conversica announced plans to add employees. Through November, Whatcom County’s nonfarm employment number was 95,100, which is 2,800 more than a year earlier, so there were many companies that added employees in 2017.
Retail sales up, but plenty of store closures
The retail industry continues to face uncertainty as it is transformed by the rise of online shopping.
As I mentioned in last week’s column, this year we’ve had plenty of retail closures as part of the wave of national chain failures, including Wet Seal, Teavana, Family Christian, Radio Shack, Rue21 and Sears Hometown. That’s mixed in with a fair number of longtime business owners who decided to retire, including Greenhouse, Morrie’s Drive-In, Kids Northwest and Woodsmiths.
The closures come at a time when Whatcom County has been spending money, posting record-breaking retail sales totals in the first half of 2017. These record sales were happening when the Canadian dollar was relatively weak compared to the U.S. dollar.