Governor signs legislation aiming to double manufacturing jobs in Washington

As the economy continues its recovery, state legislators focused on assuring that one of Washington’s economic pillars remains strong. HB 1170 sets an ambitious goal, as set out in the bill’s intent language:

It is the intent of the legislature that Washington retain and build on its leadership in the manufacturing and research and development sectors. The legislature finds that a thriving research and production sector are complimentary and should be promoted in every region of the state. The legislature finds this is critical to provide a strong, resilient tax base for good schools, safe streets, and community optimism. Therefore, the legislature intends to identify and invest in strategies to ensure every geographic region of the state can benefit from a strong manufacturing and research and development base, with the goal of doubling the state’s manufacturing employment base, the number of small businesses, and the number of women and minority-owned manufacturing businesses in the next 10 years. (Emphasis added)

A recent research report sponsored by the Association of Washington Business identified the crucial role the manufacturing sector plays in the state economy. From the report:

Because manufacturing is a key driver of economic growth, states across the U.S. compete for these activities through incentives and recruitment policies. States across the U.S. compete for manufacturing investments through a range of tax incentives and discretionary grants and loans. Manufacturing continues to be a key source of innovation and high paying, high skill jobs and an engine of economic growth. However, equal or more important are the fundamentals of access to (and cost of) key business inputs, such as qualified workers, land, and energy, and the predictability of permitting processes.

AWB recently featured the report’s author, Spencer Cohen, on the organization’s Capitol Focus program.

Economist Spencer Cohen said the overall impact of these sectors is huge.

“They’re what we would consider to be major pillars of the state economy,” Cohen said. “And part of it’s because they’re quite large, and they pay good wages, but also because they’re what we consider to be basic industries, meaning that they are largely exporting the vast majority of what they produce.”

In noting passage of HB 1170, the Washington Research Council wrote of how the bill directs the state to pursue its objectives.

The bill creates a “manufacturing cluster acceleration” subaccount within the economic development strategic reserve account. The Department of Commerce may use the subaccount for projects that help “manufacturers to diversify their customer base and supply chain,” for “pilot or demonstration manufacturing projects coordination with organized cluster initiatives,” and for projects “intended to increase manufacturing and research and development jobs regionally.”

Additionally, the Department of Commerce must report each biennium “on the state of the manufacturing and research and development industry and workforce.” The department must also report every four years on “the progress made in developing, recruiting, and retaining research and development employers and workforce; and a description of how the state’s policy toolkit for developing strength in research and development as a sector compares to competitor states.”

It’s a competitive environment, as Cohen’s research makes clear. The legislation’s recognition of the importance of the sector is welcome.