Recession rocks a state that thought it was safe

SEATTLE — When rumors of layoffs first hit Microsoft’s campus in the fall of 2008, Rod Learmonth shrugged them off.

There were no signs of trouble from the software giant, which took pride in never having mass layoffs in its 34 years. Learmonth, a full-time program manager for online services, thought it would weather the storm.

The rumors came again in January. This time, Learmonth lost his job as the recession engulfing the nation began in earnest in Washington state.

After January 2009, nearly every county’s unemployment rate worsened dramatically, rapidly rising to match the nation’s joblessness average. Bankruptcies and foreclosures also began to spike around the state, according to The Associated Press Economic Stress Map.

Washington state defied the recession for months but finally buckled, according to the AP’s data. In Snohomish County, the jobless rate climbed to double digits for the first time in 25 years

As the recession began in late 2007 and gained speed, the tipping point in many states was November 2008. Washington marched on into 2009, buoyed by the Seattle region’s reputation for a mature and diverse economy. After all, software giant Microsoft, national coffee chain Starbucks, international aerospace leader Boeing, and other affluent companies are in the area.

But people weren’t buying coffee anymore. Airlines were nervous about new purchases. Computer sales went down.

When layoff announcements for those companies came in the waning days of 2008 and early 2009, it signaled the state was in trouble. The recession had finally hit the state’s population center and the heart of the economy. Other parts of the state, including southwest and northeast Washington, were already reeling in the downturn, data show.

Washington’s jobless rate is at 9.1 percent, its highest level since 1984, a recent report from the state Economic and Revenue Forecast Council said. Employment is weakest in construction, non-aerospace manufacturing, and professional and business services.

AP data show that counties — Clark, Cowlitz and Snohomish among them — with large manufacturing sectors had some of the most elevated stress levels.

There are spots of resilience. King County’s stress index number ranks among the lowest for the nation’s most populous counties — better than the counties home to New York and Chicago.

“We think the recession is going to be over in the 3rd quarter sometime, unemployment to rise until 2nd quarter until next year,” said Arun Raha, the state’s chief economist.

Raha said he saw signs of stabilization around the state in recent data.

For foreclosures, problematic areas began to appear early. Franklin and Pierce counties started seeing more of them in October of 2007. Five months later, Pierce had the highest rate of foreclosures in the state, a position it has not relinquished.

Data show that Yakima County has had high bankruptcy filing rates even before the recession started, and it has only gotten worse.

Low pay in an agricultural economy may contribute to people losing their footing if they overextend their spending.

For years, Shelly Brann has worked at the Skagit County Community Action Agency helping people on the verge of homelessness seek ways to avoid losing their houses.

But as the nation’s economy sank, her boyfriend, Eric Krangnes, lost his job and health problems struck the Skagit County couple. Brann now is struggling to keep her home.

“It is a humiliating experience to have to go to the food banks and stand in line with the same clients that I am working with throughout the week to overcome their own hunger and homelessness issues,” Brann said. “It is even worse to have to go to my own colleagues to apply for emergency housing funds so that my own family can avoid homelessness.”

Krangnes worries for their 3-year-old son and Brann’s teenage daughters.

“I just crash,” Krangnes said. He had worked at a company that manufactured roofing supplies. “Worried all day long. If it was just us … but when you got a little guy, you just want to break down and cry, you know.”