Magazine article American Banker

Seattle Bankers Hopeful despite Boeing Cutbacks

Magazine article American Banker

Seattle Bankers Hopeful despite Boeing Cutbacks

Article excerpt

Not too long ago, the Boeing Co. controlled the economic destiny of Washington State.

During the recession of 1969 to 1971, massive cutbacks at Boeing pushed the local unemployment rate to 11%. Billboards asked that the last person to leave Seattle put out the lights.

So when the aerospace giant announced in January that it would cut another 19,000 jobs in the Puget Sound region over the next two years, some Washingtonians feared the worst.

Boeing has already axed thousands of positions since 1989. By 1994, it will have eliminated roughly one-fourth of the 107,000 jobs it was providing in the Seattle area at the end of 1989. And economists estimate that one additional job disappears in the region for every one lost at Boeing.

However, many bankers and economists are convinced the latest Boeing cutbacks can be shrugged off.

"What I'm looking for in western Washington in 1993 is a flat year, not a repeat of 1969," said John Mitchell, chief economist of U.S. Bancorp, Portland, Ore.

High-Tech Transformation

Indeed, the current round of Boeing layoffs is milder than those of two decades ago, and the Seattle-area economy is far more diversified. The growth of high technology businesses - symbolized by the meteoric rise of software powerhouse Microsoft Corp. - has transformed the Northwest metropolis.

The economy in Seattle has slowed but hasn't fallen into recession. For Washington State as a whole, wage and salary employment rose 1.3% from March 1992 to March 1993. …

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