Oregon's economic engine throws a gear

The State of Oregon is marking another unfortunate landmark this month by leading our nation's unemployment rate.  For the past 14 consecutive years, Oregon's unemployment rate has exceeded the national average every month since June 1996, when John Kitzhaber was still in his first term as Governor.

    According to the most recent estimates available, 10.6 percent of our state's workforce is currently unable to find employment.  This equates to 208,579 Oregonians that are part of an estimated 9.9 percent unemployed nationwide.  This leaves an estimated 15.2 million Americans in our nation's workforce sitting idle.

    After enduring nearly a three year budget-busting recession, a new report makes it possible to at least begin to assess the financial damage that is being done to our state.  The report was made public this week and is the most current information available.

    According to the Oregon Department of Revenue, personal income tax collections in 2008 dropped by nearly $600 million from the record levels recorded in 2007, as more than $8.6 billion in taxable income poured out of Oregon's economy in a single year.   Nowhere was the financial damage more apparent than in Clackamas, Multnomah and Washington counties, where taxable incomes fell nearly $4 billion between 2007-08, draining almost $300 million in state income tax contributions from state coffers.  

    But the financial breakdown was not confined to the urban areas of the state.  Incomes and state tax contributions were reportedly down sharply in all but three of Oregon's 36 counties in 2008.  It's expected to be even lower when 2009 data becomes available.

    Taxpayers in Oregon's three largest counties---Multnomah, Washington and Clackamas---reported earnings of more than $43.4 billion in 2008, or slightly less than half of the $90 billion in adjusted gross earnings reported by all Oregonians that year.  But even at half throttle, the economic engine of the state continued to produce more than half of the personal income tax revenue collected by Oregon's Department of Revenue.  Personal income tax payments from the tri-county region topped $2.5 billion in 2008, a sharp decline of more than $289 million from the year before, but still equivalent to 50.5 cents of every dollar in personal income taxes collected by the state that year.

 ".....for those of us who agree it is important to offer public education in Pendleton; who understand the need to provide public health care services in Bend; and be able to provide public safety in Klamath Falls,  it is important to realize these public services are paid for and made possible by the jobs and payroll taxes being collected from the Westside of the Portland metro region."  

       Excerpts of public testimony by WEA Executive Director Jonathan Schlueter, May 4, 2010 to Oregon Dept. of Environmental Quality

    Further proof of the financial impact of the current recession, can be found in the gross incomes recorded in each county.  Residents of Clackamas County reported the highest incomes in the state, averaging $67,018.  Washington County taxpayers slipped to second place with average taxable earnings of $65,545, while Multnomah County taxpayers reported gross earnings averaging $55,660, dropping to fourth place behind Benton County.  By comparison, sparsely populated Wheeler County in north central Oregon reported average earnings of just $27,430 among 543 tax returns filed in 2008, securing its claim to the lowest earnings among 36 Oregon counties.

   Despite the state's crippling recession, Oregon's population continued to increase by more than 35,600 last year, while drawing more than 70 new residents to the tri-county region every day.  The population of Multnomah, Washington and Clackamas counties set new record numbers on July 1, 2009, based on official estimates released last month by the U.S. Census Bureau, becoming home to 43 percent of all Oregonians.  Viewed in simpler terms, the population of Multnomah County was growing at a pace of 33 people daily, Washington County added 22 residents per day, and Clackamas County welcomed 15 new neighbors every day in the past year.

   For the most current economic and demographic profiles for the State of Oregon and the Westside of the Portland metropolitan region, visit our website www.westside-alliance.org.