Baffled by the Global Economy? Go Local

The New Northwest Labor Force

Sjoblom, a vice president at the Washington Research Council, said that the area's workers will continue their transition from making things to servicing and researching things in the next five to 10 years.

Biotech is a perfect example. The archetype of the area's old biotech industry was Immunex (maker of the blockbuster arthritis drug Enbrel), which merged with Amgen (AMGN). Now most area biotech firms see themselves as simply developers of drugs that will be licensed to major pharmaceutical manufacturers; sales and marketing teams will be thin. This means you can expect fewer workers per company, but possibly a great number of companies as the best brains from universities find start-up costs a lot lower.

That doesn't mean manufacturing is completely dead. The new Boeing 7E7 plant is tentatively slated to add just 1,200 jobs to the region, but there are persistent rumors that the company's Japanese subcontractors may elect to transport big chunks of their wing sections here for final assembly before being shipped to Everett for bolting to the plane -- adding hundreds, and perhaps thousands, of additional jobs.

Another wild card in the region's growth is the rise and fall of wireless communications. The national cellular revolution practically started in the Seattle area with McCaw Cellular, which was sold to AT&T in 1994 and transformed into AT&T Wireless. Earlier this year, the company was in turn sold to Cingular Wireless, the joint venture of BellSouth and SBC Communications -- a merger that's expected to cost the region 4,000 jobs.

Or will it? Sjoblom said regional economists debate whether jobs move to people or people move to jobs. In this case, he said, other wireless companies are talking about moving operations to Seattle to take advantage of the region's expertise in the field. In addition, fired workers with something to prove are often the most successful creators and builders of clever new companies.

New Opportunities

Area industrial giants Weyerhaeuser and Paccar will add scant jobs as their businesses thrive, as productivity improvements help both loggers and truck assemblers do more with fewer bodies. There are still 5,000 loggers in the state of Washington, but the lumber business is expected to level off as the homebuilding boom slows in sync with higher interest rates.

Joseph M. Phillips, dean of the Albers School of Business and Economics at Seattle University, said his graduates are finding their greatest successes in the accounting departments of companies like these, as executives find they need more help meeting the reporting requirements of the Sarbanes-Oxley Act of 2002.

If you drive due west from Phillips' school, you'll crest a hill where you can see the construction of a new 42-story headquarters for local banking titan Washington Mutual. Due to open in 2006, the tower will consolidate many of the company's far-flung operations, just as the bank itself has consolidated many smaller savings and loans around the county. The company did extremely well during the recession but has suffered in recent months along with the rest of the homebuilding complex amid fears that interest rate hikes will kill its business.

What hasn't died, however, is the entrepreneurial drive of many of the executives of banks and savings and loans that Washington Mutual and Bank of America have swallowed. They have gone on to run successful smaller concerns such as Cascade Financial (CASB) and First Mutual Bancshares (FMSB) -- two impressive engines of regional growth themselves through small-business and real-estate loans.

In short, the Seattle area is doing just what you would expect from a capitalist textbook: It has emerged from hard times with renewed vigor as investments are applied to areas where the highest growth in returns could be expected. The table below lists the 10 Washington companies that should perform well the next six months. I'll watch them and report back later in the year.

Seattle's Top 10 These Washington companies are poised to stand tall in coming months
Company	Market Cap	Industry	May 12 Close
SonoSite (SONO:Nasdaq)	$314 million	Medical instruments	$21.42
Microvision (MVIS:Nasdaq)	176 million	Electronics	8.21
Nextel Partners (NXTP:Nasdaq)	3.8 billion	Wireless communications	14.58
Nastech Pharmaceutical (NSTK:Nasdaq)	153 million	Drug delivery	12.84
Getty Images (GYI:NYSE)	3.2 billion	Business services	54.41
Expeditors Int'l of Washington (EXPD:Nasdaq)	4.5 billion	Freight services	43.17
Rainier Pacific Financial Group (RPFG:Nasdaq)	122 million	Regional banks	15.65
Starbucks (SBUX:Nasdaq)	15.0 billion	Specialty eateries	37.77
Costco Wholesale (COST:Nasdaq)	16.8 billion	Discount stores	36.55
Source: MSN Money

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