Western Cities Seek to Lure Tech Jobs from the Coast

Spokane economic development leaders created Hacking Washington, a program to get some Seattle companies to consider expanding 280 miles to the east.

In this Tuesday, May 21, 2019, photo, Spokane Mayor David Condon displays the city's flag in his office.
In this Tuesday, May 21, 2019, photo, Spokane Mayor David Condon displays the city's flag in his office.
Dan Pelle/The Spokesman-Review via AP

As the Seattle area becomes more crowded and more expensive, Spokane Mayor David Condon sees an opportunity to grow the state's second-largest city.

Condon has been visiting the Seattle area recently, selling Spokane as a place with an educated workforce, cheap housing, shorter commutes and lots of amenities.

"We're talking about the value you get in Spokane and the access to talent in Spokane," Condon said recently in a call from Denver, where he was also pitching the merits of the Lilac City.

Condon focuses on contacting alumni of the five universities that operate in the Spokane region, in hopes they might move jobs to the city of 219,000 residents.

Spokane is the nation's 100th largest city, according to the Census Bureau, and joins other mid-sized cities in the west such as Reno, Nevada, and Boise, Idaho, in trying to lure jobs from larger coastal cities.

Seattle is not giving up easily.

Mayor Jenny Durkan issued a recent statement in which she called Seattle the city that "invents the future."

"Seattle is home to the best companies because we have long been a leading global destination for high-skilled workers and thought leaders," Durkan said. "While I hope Spokane continues to grow, there's no greater city to live, work and enjoy than Seattle."

But it's no secret that the Seattle region is bursting at the seams with high-paying technology jobs. Housing prices have skyrocketed, business costs are up and traffic is terrible.

In response, Spokane economic development leaders created Hacking Washington, a program to get some of those companies to consider expanding 280 miles (450 kilometers) east in Spokane. They created a website and set out on recruiting trips.

Condon said he focuses on luring jobs that pay $60,000 to $125,000 a year, in industries such as finance, health care, insurance and manufacturing.

"It's amazing how much farther a million dollars will go in Spokane," Condon said, referring to start-up costs.

Spokane has a few advantages.

Traffic researchers have found that Spokane has an average commute to work of about 20 minutes, compared to about 30 minutes in Seattle.

Condon noted Spokane enjoys low rent and low overhead costs, and has an easy-to-use airport with direct flights to 17 cities. "Direct flights are key," Condon said.

Housing prices have a huge gulf. The median resale price for a home in King County at the end of 2018 was $657,000, compared to $247,000 in Spokane County.

King County's unemployment rate was a tiny 2.8% in April, indicating a very tight supply of workers, compared to 5.6% in Spokane County.

Todd Mielke, head of Greater Spokane Inc., the region's chamber of commerce, said they are seeing more inquiries from companies in the Seattle area, plus from Oregon, California and Colorado.

"Can they move a department โ€” not the whole operationโ€” but a department to Spokane?" Mielke said. "Companies are looking at that first."

Mielke said real world issues such as commute time directly impact employees. So do lifestyle amenities such as arts and entertainment offerings, and attractions like Gonzaga basketball, he said.

"Gonzaga basketball puts us on the radar screen of people who might not be thinking of us," Mielke said.

The Washington Department of Employment Security, which tracks labor trends, also is predicting Spokane County may benefit from rising costs elsewhere.

"Spokane may benefit from a migration of IT firms moving to Spokane trying to reduce stress for their workers," the agency said in an October report.

The Spokane region has scored some recent business successes.

In 2017, the Seattle-based pet care company Rover.com opened an office in Spokane, which has about 75 employees. Spokane was attractive in part because of outstanding talent, said Jenni Summers, a Rover.com executive.

"It is also a community and market where we felt we could offer a positive impact," Summers said.

More recently, Seattle-based Amazon is opening a fulfillment center in Spokane, bringing 1,500 jobs. And a California company that plans to produce an electric sports car announced it would occupy a large facility in the suburb of Airway Heights.

Mullen Technologies of Brea, California, signed a letter of intent with West Plains-Airport Area Public Development Authority to manufacture its electric sports car in the Spokane area.

Initial operations are expected to create 55 jobs, and Mullen expects to employ 860 people by 2026. The development authority will build a facility totaling 1.3 million square feet and lease it to Mullen.

The deal "will allow Mullen to develop a green energy campus with the quality of life that will help us in the recruitment of world class engineers," Mullen CEO David Michery said.

Condon said he doesn't mind if businesses choose to locate outside the city limits in the county of 506,000.

"I'd like to see the Spokane metropolitan area grow," Condon said.

Could it get too big?

"We're a long ways from that," Condon said.

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