Tax incentives play a vital role in the growth of the manufacturing industry and must be protected
The state of Washington provides several tax incentives for manufacturers. The intent of the incentives is to encourage the development and preservation of jobs by assisting business in growth or relocation efforts. Manufacturers in the state of Washington have taken advantage, to the benefit of the state economy, of several of these tax incentives including the sales and use tax exemption for manufacturing machinery and equipment( M & E), the rural county business and occupation( B & O) tax, and the business and occupation tax exemption for food processors. These, and other tax incentives provided to manufacturers by the state of Washington have been factors in recruiting new business to the state as well as the expansion of existing business.
The minimum wage issue is a prominent decision factor when expanding manufacturing facilities
Washington’ s current $ 9.32 per hour minimum wage applies to workers in both agriculture and non-agricultural jobs, although 14- and 15-year-olds may be paid 85 % of the minimum wage($ 7.92). There are efforts across the state to increase the minimum wage to $ 12- $ 15 per hour. An increase in minimum wage will impact manufacturer’ s ability to expand production, increase jobs, and provide benefits for employees. A higher minimum wage also makes Washington state manufacturers less competitive in the global marketplace.
The workforce pipeline is not growing at a pace needed to meet industry demand
U. S. manufacturing needs a strong technical workforce. Manufacturers rely on the right workers with the right skills at the right time to drive innovation, increase productivity and remain globally competitive. The manufacturing workforce in Washington state is projected to increase almost 1 percent per year through 2022 adding over 20,000 new jobs in addition to high retirement rates( Source: Washington State Employment Security Department). Support for, and collaboration with, the state’ s higher education system is necessary to produce the demanded workforce needed to grow the manufacturing industry.
MANUFACTURERS CONTRIBUTE
$
2.08 trillion
TO THE U. S. ECONOMY
MANUFACTURING SUPPORTS
17.4 million
JOBS IN THE U. S.
MANUFACTURERS IN THE U. S. PERFORM two-thirds
OF ALL PRIVATE-SECTOR R & D IN THE NATION, DRIVING MORE INNOVATION THAN ANY OTHER SECTOR.
Key Data Points
• 9.6 % of all nonfarm workers in Washington state work in the manufacturing industry.
• Washington state is home to 6,906, manufacturers.
• In 2013, manufacturers contributed $ 2.08 trillion to the United States economy.
• Manufacturing supports an estimated 17.4 million jobs in the United States— about one in six private-sector jobs. More than 12 million Americans( or 9 percent of the workforce) are employed directly in manufacturing.
• In 2013, the average manufacturing worker in the United States earned $ 77,506 annually, including pay and benefits.
• Manufacturers in the United States perform two-thirds of all private-sector R & D in the nation, driving more innovation than any other sector.
Key Points from Listening Sessions
• Health care costs have risen for one manufacturing company by 41 % and 81 % for another.
• One Washington state manufacturer has incurred $ 300,000 in regulatory costs on a proposed $ 2 million building.
• Predictability and reliability in government regulation are key to supporting manufacturing growth in Washington state.