Tacoma: Economy

Tacoma: Economy

Major Industries and Commercial Activity

Named one of "America's Most Livable Communities" in 2004 by national nonprofit organization Partners for Livable Communities, Tacoma has attracted companies of all sizes. In recent years, more than a hundred high-technology businesses have relocated, opened, or expanded in the area. It is home to the seventh busiest container handling port in the United States; these containers handle imports ranging from sporting goods to VCRs, and exports ranging from lumber to apples. Other major cargoes handled by the port include forest products, grain, and automobiles. A major gateway port for international trade, the Port of Tacoma covers more than 2,400 acres of land. Port activities generate more than 28,000 jobs and $477 million in wages in Pierce County.

The rapidly growing high-technology sector adds to a diverse economy strong in agricultural and forest products, manufacturing, health care, financial and professional services, and the military, with McChord U.S. Air Force Base and Fort Lewis Army Post located in Pierce County. Significant work in satellite imaging, automated fingerprint and radio frequency identification systems, and Internet and computer services continues because of multiple broadband telecommunications systems, including the city's fiber-optic Click! Network, launched in November 1998. Over the past several years, the City of Tacoma, along with investors from the private sector, have spent $300 million on the city's telecommunications infrastructure through Click! Network, which continues expansion with new construction and additional services for customers.

Tacoma is an important center for agricultural and forest products. The first business established in Tacoma was a saw mill; Tacoma's economy is still heavily involved with timber. Regional enterprises produce more flower bulbs than the Netherlands, as well as crops, such as berries and rhubarb, which require heavy seasonal employment. Tourism is also important to Tacoma's economy. Visitors are attracted to the waters of Commencement Bay and the state and national parks surrounding Tacoma.

Items and goods produced: lumber products, pulp, paper, clothing, chemicals, furniture, flour, furnaces, railroad car wheels, candy, food products, meat and fish

Incentive Programs—New and Existing Companies

Local programs

The City of Tacoma offers a variety of business loan programs, tax credits for new job creation, industrial revenue bonds, sales and use tax exemption on machinery and equipment, a variety of housing-related programs, financial incentives for historic properties, and others.

State programs

Part of Tacoma is a designated state Empowerment Zone; employers locating within this area and who meet certain hiring requirements are eligible for tax credits, special financing, and contracting programs. Other state programs available to businesses in Tacoma include tax deferral programs and business and occupation tax credits to businesses operating in distressed areas, high technology businesses, international services businesses, and manufacturers meeting program requirements.

Job training programs

In addition to job training programs at the area educational institutions, several other training programs exist, including the City of Tacoma Local Apprenticeship and Training Programs (LEAP), which offers apprenticeship programs, training, and opportunities to work on city public works projects. Pierce County WorkSource offers training programs and workshops for residents seeking jobs.

Development Projects

As the 21st century gets underway, new and renewal projects abound in Tacoma. A new pedestrian bridge connects the new $63 million Museum of Glass to the esteemed Washington State Historical Museum. Next door is the new Tacoma Art Museum, which opened in 2003 in a space twice the size as it previously inhabited. Its old location was bought and renovated by the Asia Pacific Cultural Center. Across the Thea Foss Waterway, a $15 million Pioneer Museum of Motorcycles recently opened. The $89.7 million convention center, anchored in the heart of downtown Tacoma opened in 2004. Also in 2004 ground was broken on a much-needed new police headquarters. Newly operational light rail lines now stretch all the way to Seattle. Plans are currently underway for the new Harold E. LeMay Classic Car Museum, to be located on 9 acres next to the Tacoma Dome and slated for opening in 2008.

In 2002 the state legislature approved funding for the construction of a second bridge span across the Tacoma Narrows. The new bridge, which will be built parallel to the existing bridge, is expected to be completed in March 2007. Team Tacoma, a local development group, is planning a $25 million project along the waterway that includes condominiums, parking areas, and a mix of commercial and retail spaces. The Tacoma campus of the University of Washington recently dedicated two new buildings, while students at the University of Puget Sound are getting a new, 184-resident dormitory.

Economic Development Information: Tacoma Pierce County, 1001 Pacific Avenue, Suite 400, Tacoma, WA 98402; telephone (253)627-2836; fax (253)627-8783. Tacoma Economic Development Department, 747 Market Street, 9th Floor, Tacoma, WA 98402; telephone (253)591-5364; fax (253)591-5232; email director ryan.petty@ci.tacoma.wa.us

Commercial Shipping

The Port of Tacoma is the sixth largest container port in North America, and one of the country's primary gateways for trade with Japan, China, Taiwan, and Thailand. Tacoma is also strongly tied to Alaska's economy, with the port handling more than 75 percent of all waterborne commerce going from the Lower 48 to Alaska. A new 171-acre mega-container terminal opened in January 2005, part of a $34.1 million plan to meet the needs of the Port's existing customers and to attract additional customers.

The city is also an important rail shipping hub and is served by two major transcontinental railroads: Burlington North-ern–Santa Fe and Union Pacific. These two railroads link Tacoma to major markets in the Midwest and East Coast. Rail is also used to move a variety of export commodities through Tacoma—everything from Midwest corn to John Deere tractors. More than 200 trucking companies work to move goods through the city, and major air freight carriers serve Seattle-Tacoma International Airport, located about 30 minutes from Tacoma.

Labor Force and Employment Outlook

Tacoma draws from a stable work force of skilled and unskilled workers that has steadily attracted new business and industry. Local firms can rely on more than one million workers who live within an hour's commute of the city. Tacoma-Pierce County has experienced an extensive history of mature labor relations. Employment opportunities are said by local analysts to be on the increase. Civic and business leaders continue to predict a prosperous future for the city, based on its economic diversity and availability of abundant natural resources.

The following is a summary of data regarding the Tacoma labor force, 2004 annual averages.

Size of nonagricultural labor force: 254,500

Number of workers employed in . . .

mining: 400

construction: 8,500

manufacturing: 19,500

trade, transportation, and utilities: 49,100

information: 3,100

financial activities: 13,800

professional and business services: 22,100

education and health services: 37,700

leisure and hospitality: 24,900

other services: 1,700

government: 53,400

Average hourly earnings of production workers employed in manufacturing: $18.27 (2004 annual statewide average)

Unemployment rate: 6.6% (January 2005)

Largest employers	Number of employees
Fort Lewis Army Post	31,450
McChord Air Force Base	8,368
Washington State	7,857
Multicare Health System	3,748
Tacoma Public Schools	3,590
Franciscan Health System	3,521
Pierce County Government	3,173

Cost of Living

The following is a summary of data regarding several key cost of living factors in the Tacoma area.

2004 (3rd Quarter) ACCRA Average House Price: $255,772

2004 (3rd Quarter) ACCRA Cost of Living Index: 106.2 (U.S. average = 100.0)

State income tax rate: None

State sales tax rate: 6.5% (food and prescription drugs are exempt)

Local income tax rate: None

Local sales tax rate: 8.4 to 8.8%

Property tax rate: $3.23 per $1,000 assessed value (2004; assessed yearly)

Economic Information: Tacoma-Pierce County Chamber of Commerce, 950 Pacific Avenue, Suite 300, PO Box 1933, Tacoma, WA 98401; telephone (253)627-2175; fax (206)597-7305