Seattle Continues to Drive Washington’s Tech Economy

WTC’s 2005 Index of Innovation shows King County rates high in patents and start-ups; changes in industry dominance show trend towards diversification, new sector emergence

Seattle, Wash. – June 10, 2005 – Seattle continues to be the dominant region in Washington’s technology economy according to the Washington Technology Center’s 2005 Index of Innovation & Technology.
The Index, published annually as a benchmark report on Washington’s performance, includes detailed data on 12 regions in the state, evaluating them against critical drivers necessary to support a technology-driven economy.

As the largest metropolitan city in Washington, it’s no surprise that Seattle far outperforms the other regions in the state in most measures.* Seattle captured the top spot for patent generation, high tech start-ups and total technology employment. Seattle also pays the highest technology wages in the state and secured the number one position for federal grant dollars (SBIR awards).

Seattle does drive much of the technology economy in Washington. It’s home to many of the state’s largest companies as well as housing one of the nation’s top academic research facilities – the University of Washington.

But Seattle didn’t score first place across the board. The region was outranked by Tri-Cities with respect to technology employment as a percentage of overall employment. In Tri-Cities, 19.3 percent of all jobs in the region are within the technology sector; this number is 16.5 percent for Seattle. Only a slim margin separated these two regions on the measure of technology jobs per capita. Seattle was first with 86.5 jobs per 1000 while Tri-Cities placed a close second with 85 jobs per 1000. Seattle was also outperformed by a smaller community with respect to financial capacity. Bellingham captured the number one spot for private placements on a per capita basis. Seattle was second.

Being the largest community also means Seattle experiences some of the most dramatic losses. According to 2005 Index, Seattle experienced the second highest negative change in technology employment in the state – a loss of 8 percent. Seattle also only experienced growth in one of its top three dominant technology sectors (Software Publishing).

Washington is still coming off the final stages of its recession, so losses like these are expected. What’s more interesting are the trends emerging from changes in employment.

Aerospace, a traditionally dominant industry, saw losses in both jobs and industry dominance, which affected the overall number. However, emerging industries like Software and Biotechnology, saw growth. Software saw the highest increase in employment and national dominance since 1998; Venture Investment in Biotechnology nearly doubled, increasing from 8 to 15 percent. This is a positive shift for Seattle and for the state as a whole. We are seeing a move towards stronger diversification and a gain in dominance in new industries, which opens up new global market opportunities for Washington.

Also, it’s no surprise that Seattle ranked last of all 12 regions in housing affordability. On a positive note, while Seattle is still more expensive than most other regions in the state in this measure, higher incomes balanced out these prices and, for the first time in years, Seattle’s average housing prices were below the national average.

WTC’s Index also includes a profile of Washington’s strengths comparing to other U.S. states. Washington has traditionally scored well on a number of indicators which points to the state’s ability to sustain a technology economy. For the fifth year consecutive year, Washington claimed the top spot for new company creation. Patent activity remained strong. Over 1,400 technology patents were generated, an increase of 8 percent from the previous year. This number has continued to climb since the Index was first published in 2000. Other significant trends for Washington include: One in 10 jobs is within a technology industry and 11 out of 12 regions showed growth in at least one of their core technology industries.

The 2005 Washington Index of Innovation and Technology can be downloaded from WTC’s website at This year’s Index received sponsorship support from the following partner organizations: enterpriseSeattle, Spokane Area Economic Development Council, Kitsap Regional Economic Development Center, Pacific Northwest National Laboratory and INTEC.

*Statistical data in the 2005 Index is from 2003, the most recent available at the time of publication.

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