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Spokane's low jobless rate hides a shrinking labor force.
3.4%
Spokane County unemployment rate
July 2026, vs 4.9% WA and 4.1% US
-2,500 jobs
Spokane payroll change
Month-over-month to 264,000 total, July 2026
6.9%
Spokane average weekly wage growth
Q4 2025 YoY, to $1,369/week
3.1% vs 3.5%
Washington state wage vs. inflation
Real wages declining ~0.5% annually statewide
This Month's Takeaways
Low unemployment is masking a shrinking labor pool.
Spokane County's 3.4% July rate looks strong against the state's 4.9% and the nation's 4.1%, but it coincides with a 2,500-job payroll decline and a labor force reduced by retirements rather than new entrants. A tight rate driven by exits, not demand, points to a different economic trajectory than the headline number implies.
Healthcare is nearly the only sector adding jobs locally.
Private education and health services added 1,200 jobs over the year and now represent close to one in five jobs countywide, while most other sectors regressed. Concentration this heavy leaves the metro's broader job growth story dependent on a single sector's continued expansion.
Wage growth locally has outpaced the state's inflation-adjusted decline — for now.
Spokane's average weekly wage rose 6.9% year-over-year through Q4 2025 to $1,369, a stronger showing than the statewide 3.1% wage growth against 3.5% inflation that is producing real wage declines elsewhere in Washington. Whether Spokane's wage gains hold up against the same inflation pressure will be a key test in coming quarters.
Retirements are becoming a structural, not cyclical, labor force story.
Workers voluntarily leaving the labor force are reducing Spokane's available workforce by about 3% annually, a trend regional economists expect to intensify toward 4% by 2029. That demographic arithmetic, more than cyclical hiring swings, may be the more consequential long-run variable for the metro's economic capacity.
Local Economic Conditions
Spokane County's unemployment rate held at a low 3.4% in July 2026, well below both the state's 4.9% and the national 4.1%, even as total nonfarm payrolls slipped by 2,500 jobs month-over-month to 264,000 — a divergence consistent with a civilian labor force that is shrinking rather than a job market that is strengthening. Healthcare and private education continue to carry the metro's growth, adding 1,200 jobs over the year, while retirements are pulling roughly 3% of workers out of the labor force annually, a structural drag state economists expect to peak near 4% by 2029.
Open Threads in the Data
Spokane's low headline unemployment rate is flattering relative to Washington's statewide softening — the state cut roughly 14,500 jobs in September and ranked 44th nationally in job growth — but local payroll contraction alongside a shrinking labor force suggests the tight rate reflects fewer available workers more than robust demand. For commerce leaders weighing local investment or expansion, that distinction matters: a metro posting 3.4% unemployment on a flat-to-declining labor force is a materially different growth environment than one posting the same rate on rising participation. Consider evaluating expansion or investment timelines against labor force trend data specifically, not the unemployment rate alone.
