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Aug. 12, 2022

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In Our View: Economic numbers add up to mostly good news

The Columbian
Published:

“It’s the economy, stupid.”

That mantra from Bill Clinton’s successful 1992 presidential campaign has become the de facto slogan for three decades of politics in the United States. But economic performance can be in the eye of the beholder, and that leads to complex questions about how the American economy is faring as it recovers from the COVID-19 pandemic.

Ask 100 voters about the economy these days and you are likely to receive 100 different answers. But there is encouraging news in the local job market.

“We’re beyond recovery and into expansion,” Scott Bailey, the state’s regional economist for Southwest Washington, said last week, following the latest data from the Washington Employment Security Department.

Locally, seasonally adjusted nonfarm employment rose by 600 jobs in March, bringing the total in Clark County to a record 174,800.

Specifically, there were strong gains in the leisure and hospitality sector, along with construction, trade, transportation and utilities, professional and business services, and education and health services.

That broad-based growth reflects the diverse economy that has emerged in Clark County, but sectors such as state and local government and K-12 education still lag behind pre-pandemic levels. The arts, entertainment and recreation services sector has 500 fewer jobs in the county than it did before COVID-19.

When talking about the economy, the numbers inevitably get crunched into percentages.

The county’s unemployment rate was 5.1 percent in March, an improvement from the 6.3 percent level of a year ago. Those gains echo national trends, where the unemployment rate was 3.6 percent in March — the lowest in two years — and wages are increasing.

That comes on the heels of a 5.7 percent increase in gross domestic product for 2021 — the sharpest growth since 1984.

All of the positive economic news is tempered, however, by a steep inflation rate. Nationally, prices in March were 8.5 percent higher than in March 2021, the biggest increase since 1982. Cost increases are being largely fueled by gas prices — where increases have been exacerbated by Russia’s invasion of Ukraine — and by continuing supply chain woes.

The issue has a global impact. Canada’s inflation rate in March was the highest in 31 years; Europe reported a 6.7 percent annual increase as of last month.

The fact that high inflation is not unique to the United States does not ease the pain for American consumers. Inflation diminishes the value of our paychecks, and it has resulted in higher interest rates that slow the economy and especially affect would-be homebuyers.

So, all of the numbers aside, how is the economy doing? Again, it is a complex question.

While some economists warn of a coming recession, Michelle Holder of the Washington Center for Equitable Growth told the New York Times: “The recovery from my perspective is fairly robust, and so why not enjoy this right now? I don’t think similar voices were this bent out of shape about high unemployment.”

With encouraging employment numbers, the economy of Clark County is resting on a solid foundation for the near future. And those employment statistics might be revised upward upon further review. Bailey, the state’s regional economist, told The Columbian, “It may be doing better than we thought.”

Either way, public perception will play a role in November. When it comes to elections, after all, it’s the economy, stupid.

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