Narrative: II. a. 1. A.

(i) Existing Demand Industry Sectors and Occupations. Provide an analysis of the industries and occupations for which there is existing demand.

Between February 2010 (the State’s Great Recession low point) and February 2020 (just as the COVID-19 pandemic was taking hold) there were 120 months and all except 17 of them saw job growth. In February 2020 Washington state employment registered at just under 3.5 million, and the unemployment rate reached a low of 4.1 percent. While there were areas and sectors that struggled, overall, the economy was strong and labor markets were healthy.

In early 2020, most Washingtonians were working in the service sector – about 85 percent, and it was where most recent job growth was concentrated. Unfortunately, service jobs were among the most vulnerable to disease transmission and once pandemic lockdowns began and social distancing requirements were put in place in March, these jobs accounted for almost 90 percent of all job losses between February and May of 2020. The biggest contributor of service sector job losses, about one-third of total losses, was .

Since that time, the Leisure and Hospitality industry has added jobs at the fastest pace (up 49 percent), but it is still 40,000 below the pre-pandemic level. Similarly, Retail Trade shed jobs at a fast rate in early 2020 but has experienced solid growth since.

The information sector weathered the pandemic as well as any other in the state. After growing by 46 percent in the decade that preceded Covid, it only lost 1 percent of its workforce during the downturn, and then rebounded by 11 percent by the end of 2020.

The pandemic has continued through 2021 and into 2022, further straining the healthcare system in Washington, the U.S., and the world. In Washington, registered nurses have shown the most online job postings—over 8,000 in August 2021. Laborers, managers, and software developers also had large numbers of postings.

Through the end of this decade the occupation projected to have most growth in demand is software developers (4,310 average annual openings). It is followed by home health aides (2,122), market research analysts (1,824), and operations managers (1,404).

(ii) Emerging Demand Industry Sectors and Occupations. Provide an analysis of the industries and occupations for which demand is emerging.

Between 2017 and 2027, the information sector[1] is projected to have the fastest annual growth in employment ---at 3.2 percent, followed by “Professional, Scientific, and Technical Services” with 2.6 percent employment growth over those same 10 years, according to Washington’s Employment Security Department. Overall, the state’s employment growth is projected to average a 1.5 percent each year during this period. The slowest growing industry is mining (0.1 percent), followed by manufacturing (0.3 percent). In short, the forecast anticipates high-turnover, low-wage industries to grow enough to remain the largest in terms of employment, while professional services and education & health become increasingly more important economic drivers, primarily as the relative size of goods-producers declines (outside of construction, though that could change quickly depending on the economy).  

The expected continued growth in the construction and healthcare industries is mirrored on the occupation side with increased demand for carpenters, construction laborers, registered nurses, and personal care aides. Most of the rest of the growth occupations are service jobs, which share the characteristic of not being easily outsourced.

(iii) Employers’ Employment Needs. With regard to the industry sectors and occupations identified in (A)(i) and (ii), provide an assessment of the employment needs of employers, including a description of the knowledge, skills, and abilities required, including credentials and licenses.

Despite large numbers of jobseekers, companies still have difficulties finding workers with specific skills. To better measure the needs of industry, Washington’s Workforce Board periodically administers and publishes an Employer Needs and Practices Survey. The most recent survey, conducted in 2019, featured responses from 2,647 employers, of which 1,765 were considered valid.

According to survey results, almost 70 percent of Washington’s employers with two or more workers experienced workforce challenges in the 12 months prior to the survey—a pre-pandemic period when the state’s economy was booming. Finding and hiring qualified job candidates was the most common challenge for employers across the state, with 38 percent of survey respondents citing this issue. Some 80 percent of Washington’s employers had job openings during this same period, with 45 percent reporting difficulty finding talent. One in five of these employers (roughly 15,000) had to turn down new business opportunities as a consequence of not finding the right job candidates to fill open positions—a significant economic loss.

Small businesses (those employing fewer than 20 people) account for 20 percent of Washington’s workforce. They faced greater recruiting challenges than larger firms, and thus experienced greater losses in missed business opportunities because of being short staffed. However, the state’s larger employers experienced more turnover and retention issues than smaller businesses. Larger businesses also experienced a higher rate of declined job offers than smaller employers, according to the survey.

Based on job postings as of December 2021, knowledge and/or experience with customer support experience, administrative scheduling, productivity tools, sales, and infectious disease were the most in-demand skills. The certifications listed as highest in-demand were driver’s license, registered nurse, First Aid/CPR, and commercial drivers.

The Workforce Board pays particular attention to mid-level occupations and skill gaps—focusing on occupations that require education beyond high school but stops short of a four-year degree. This mid-level skills section of the labor market sits at the intersection of a number of trends. Workforce Board research shows that among mid-level training occupations, the projected supply of skilled graduates will fall short by about 137,000 of projected openings each year in Washington. The largest gaps are in computer and information science, technician, service, and education occupations. Teacher assistants, preschool teachers, and library technicians are key occupations driving demand for educators at the mid-level. As seen in previous analyses, demand also remains strong for specific health occupations, led by jobs for registered nurses, medical and dental assistants, diagnostic-related technologists, dental hygienists, massage therapists, and health practitioner support technicians.

Washington’s workers have traditionally earned higher wages than the rest of the nation, a trend which has accelerated in recent years. In 2001, state residents earned an average 3 percent more than workers nationally. By 2019, Washington workers median earnings were 14 percent higher than the national median. Washington workers pulled in a median annual wage of $41,735 compared to the rest of U.S. workers who earned a median annual wage of $36,519. While this is generally good news for Washington’s workers, earnings growth has not been equally distributed. In 2019, individuals with less than a high school education had median annual earnings of $30,627. This compares to $62,447 for those with bachelor’s degrees and $86,167 for those with graduate or professional degrees.

[1] Among 2-digit NAICS industries, Washington Employment Security Department, industry control totals.