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Originally published October 17, 2012 at 10:07 AM | Page modified October 18, 2012 at 5:33 PM

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Local hospitality industry serves up job growth

The state’s economy added a net 1,200 jobs last month, led by the hospitality industry, pushing the jobless rate down to 8.5 percent.

Seattle Times business reporter

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Seattle area hotels, restaurants and tourist attractions hired more workers last month to keep up with a seemingly endless summer, pushing the sector to its highest employment level in more than a decade.

That helped the metro area’s unemployment rate edge down to 7.6 percent, while the statewide rate dipped to 8.5 percent, the state Employment Security Department reported Wednesday.

In downtown Seattle, Kimpton Hotels & Restaurants added more housekeepers, front-desk help and restaurant staff at its three boutique luxury hotels last spring and completed a wide-ranging $5.2 million renovation of its Hotel Monaco in anticipation of a strong tourist season. Tom Waithe, Kimpton’s regional director of operations, said it was the best summer the hotel chain had seen in years.

A record cruise-ship season, a couple of big Seahawks home games, and a computer-gamer convention all contributed to an exceptionally strong September. The dry, warm weather didn’t hurt, either.

“All in all the mixture was phenomenal,” said Tom Norwalk, CEO of the Seattle Convention and Visitors Bureau.

The leisure and hospitality industry led all others in new jobs last month, according to ESD, as Washington state overall gained a net 1,200 jobs in September.

Joe Elling, chief labor economist at the state Department of Employment Security, said September’s figures showed job growth in Washington was slowing down but was still positive.

The private sector lost 1,500 jobs, and the public sector gained 2,700 jobs. The figures are adjusted for month-to-month fluctuations to minimize the impact of school openings and end-of-summer jobs; but the reported jump in public-sector jobs and the decline in private-sector employment puzzled state officials, who said the numbers likely will be revised next month.

Indeed, the state revised its jobs estimate for August: The state originally reported a loss of 1,100 jobs, but Wednesday it changed that to a gain of 2,500 jobs.

In addition to leisure and hospitality and the government sector, the professional services sector added 800 jobs statewide in September.

All other sectors lost ground or were flat. Manufacturing shed the most jobs — 1,300: While aerospace manufacturing added 1,100 jobs, that gain was offset by losses in other kinds of manufacturing, including 1,200 jobs in food processing.

Over the past 12 months, the state’s economy added 58,500 jobs, with manufacturing, professional services, and the leisure and hospitality sector contributing more than half of them.

Many of those hospitality jobs are lower-wage or part-time jobs. The average hourly earnings of Washington workers in the sector was $14.18, well below the average for all private-sector workers in the state, $26.85, according to government estimates. The estimates, which are derived from payroll data, don’t include bonuses, unreported cash tips and value of free meals.

Still, the state unemployment rate in September was better than a year ago, when it was 9 percent.

At the Pacific Science Center, about 55 people were hired for the King Tut exhibit, which opened May 24. More than a half million people visited from June through August, almost double last year’s traffic. Almost 100,000 came in September.

“The daily average attendance figures are the strongest in over a decade,” said Crystal Clarity, marketing director for the center.

Desiree Phair, the Employment Security Department’s economist for Seattle and King County, said the new high in local leisure and hospitality employment — 146,200 jobs — isn’t a blip.

“It has been growing long enough and consistently enough I think it’s safe to say it’s positive news,” Phair said.

The Seattle-area hotel market is almost back to the average annual occupancy levels and room rates seen in 2007, according to a report by PKF Consulting.

Chris Kraus, a senior vice president at PKF, said demand is so strong that average room rates should increase in 2013.

But one big uncertainty, he said, is the so-called “fiscal cliff” at the end of this year — the expiration of several tax cuts, the beginning of new taxes to fund President Obama’s health-care law, and automatic spending cuts across the board in government programs.

If that happens, “there’s concern we might dip back into a recession,” he said.

For now, occupancy has been so high at Hotel Monaco and Kimpton’s two other hotels in Seattle that rates “have begun to climb back to the golden days of the 2006-2007 era before everything fell apart,” said Kimpton’s Waithe. “We’re optimistic for next year.”

Sanjay Bhatt: 206-464-3103 or sbhatt@seattletimes.com On Twitter @sbhatt

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