Friday, October 2, 2026
Business sentiment in Thurston County has fallen to its lowest level since 2010, a Thurston Economic Development Council Economic Vitality Index report showed.
The report found signs of a moderate downward trend taking shape after several years of post-pandemic recovery.
The Economic Vitality Index (EVI) posted a reading of 116.8 for the second quarter of 2025 — down 1.7 points from its post-pandemic high of 118.5 at the end of 2024.
The composite index measures performance using five monthly indicators: total residential building permits, initial unemployment claims, consumer sentiment, U.S. securities yield spreads, and equity financial instruments deemed impactful to the local economy.
The EVI, developed in partnership with Saint Martin’s University in Lacey and supported by public sector and private sector sponsors, serves as a planning and forecasting tool for regional economic stakeholders.
Thurston Economic Development Council and Council for Business & Innovation Executive Director Michael Cade said in a statement on Tuesday, July 15, that the recent decline has paralleled “delayed decisions, paused investments, and shelved expansion projects.”
The downturn also corresponds with sharp drops in both business and consumer sentiment.
The CEO Confidence Index, published semiannually by the Economic Development Council, dropped to 34.5 — a fall of 10.6 points from the previous quarter and its lowest value since its inception. in 2010.
The index reading is derived by responses from local business executives, who assess their outlook based on conditions in their own industries and the local economy.
“There is a good deal of uncertainty facing Thurston County’s economy. … The start of a moderate downward trend does appear to be materializing,” said Saint Martin's University Professor Riley Moore.
Among the people surveyed, 52% of executives said they expected profits over the next year to be “substantially better, moderately better, or the same,” down from 68% in the fourth quarter of 2024.
Of those executives projecting gains, 47% attributed profits to “an increase in market growth and demand,” down from 54% six months earlier.
Meanwhile, 26% said they anticipated needing to raise prices, up from 17 percent in the previous quarter. In the latest findings, price increases overtook cost reductions as the second-most cited source of projected profits, behind demand growth.
The Economic Development Council uses the University of Michigan’s Consumer Sentiment Index as a proxy for local perceptions of economic conditions. The national index fell to 52.2%, down from 73% at the end of 2024 — the second-lowest score since the EVI’s inception.
“Consumer and household expenditures are a major driver of economic growth at both the local and national levels,” the report states.
The EVI report also notes macroeconomic and political factors are contributing to local uncertainty.
“The rollout of policies to address state budgetary shortfalls, along with reduced national, state, and local public sector allocations, are expected to mute economic gains for Thurston County given the large public sector influence on the local economy,” said Moore in the report..
Although economic sentiment has weakened, the Economic Development Council cites government and military sectors as key sources of stability.
“Thurston County remains uniquely resilient. With a high concentration of stabilizing institutions — including our state government and Joint Base Lewis-McChord — we benefit from a base of recession-resistant economic activity,” Cade said.
Cade also added Thurston County continues to rank among the top 10 U.S. regions in multiple economic performance categories, and is home to “the most inclusive middle class of any similarly sized region in the country."
Other public-sector partners echoed support for EVI and its influence in development planning.
Jennica Machado, Economic Development Director for the City of Olympia, backed the EVI as it gives city government a big-picture view and up-to-date data about how the economy is doing. She said city staff utilize the information to help guide planning and make decisions.
Port of Olympia Executive Director Alex Smith said the port’s vision for a strong and resilient Thurston County depends on continued collaboration with local partners. She said sponsoring the 2025 EVI mirrors the port’s support for efforts that advance the region’s economic health.
South Puget Sound Community College Tim Stokes said the college’s role as a founding sponsor of the EVI showcases its commitment to supporting local economic development.
He noted the college works closely with county partners in order to build a resilient and inclusive economy that meets the changing needs of students and the workforce.
Stokes added the college’s partnership with the Economic Development Council uplifts long-term community growth.
In terms of planning support, the Economic Development Council sis expanding its capacity to deliver actionable economic data, and now invites community groups and project stakeholders to request planning presentations and in-depth analysis, as part of its advocacy in supporting community and economic development decision makers.
The report can be accessed here. People seeking customized briefings or data sessions can reach out to Connor Tibke, lead author of the EVI, at CTibke@thurstonedc.com.
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Honestyandrealityguy
I believe we need common sense. So many business owners being declined simple requests. So many businesses were forced to close or move, such as: Oly Brewery, Richie Bros, Hardel's, and more. So many small businesses have closed because they can't get permits to simply remodel or something.
Politicians need to look at these folks more as "customers", not taxpayers. As a customer, if they work with them, everyone makes more money. Common sense please.
Saturday, July 19, 2025 Report this
Southsoundguy
Because Thurston county and Olympia suck and are run by inept, spiritually boomer libs.
Saturday, July 19, 2025 Report this
jimlazar
There is a bright side to this.
The regional housing market could use a reprieve of the pressure of the past few years. Perhaps a cooling economy will mean fewer people wanting to move here, and less pressure on the rental housing market.
This softening showed up in the UW Housing Survey two quarters ago, with us reaching our highest vacancy rate in 12 years. When the housing vacancy rate goes above 5%, then rents start to soften.
There are two ways to balance the housing market. Either increasing supply (and that drives up costs and prices, because more difficult sites must be developed) or decrease demand (letting existing housing more fully serve local demand.
Saturday, July 19, 2025 Report this
Boatyarddog
As well SSGUY, Has nothing intelligent to contribute but Smack talk about Anything.
Saturday, July 19, 2025 Report this
ClownPenis88
Not surprised Thurston County reaps what it sows. There economic report is a mirror reflection of themselves an the leadership in there economic standing with there communities that which they serve.
Saturday, July 19, 2025 Report this
chrispc2u
Have any of you visited downtown lately for a meal? It’s Lord of the Flies meets Invasion of the Zombie Body Snatchers. Downtown (including the allys behind buildings) is overrun by drug addicted obnoxious professional panhandling bums. With the coddling of expanded services Olympia draws them like flies, instead of repelling them. No, graduates of woke-driven Evergreen now making state policy, WE DON’T WANT THEM HERE. Nobody likes being panhandled on their way to a lunch out. The pandemic is essentially over, the economy rebounded and there’s no longer any excuse for enabling this in our downtown core. Move them miles out of town. Taxpayers are fed up and the businesses are losing business because of it. Stop diverting resources for professional drug-using bums and hire the roughly one third of the officers missing off the police force!
Saturday, July 19, 2025 Report this
ReasonAboveAll
The biggest issue is Thurston county doesn't have anything to draw in younger people or younger families. Just look at all the lakes. They have maybe a public dock that is super janky and no public spaces for swimming or picnicking. You can just go into the lake. Thurston county needs to expand their lake access extremely. You can't even go into capitol lake due to how disgusting it is. The old brewery is such an eye sore. They need to make it better dog parks. They need to promote and identify better younger lifestyles to draw in SINKs, DINKs and young families.
Sunday, July 20, 2025 Report this
HappyOlympian
County and Olympia leadership awful. Olympia once rated as a top-10 business city in the USA. Now we got clowns in charge hoping for reparations? Who is gonna pay those? Also need to clear the zeros out of downtown, beginning to rival pike street in Seattle. Olympia falling apart in the last decade, hope this can be stopped almost gone. Luckily, we got Boatyarddog a true fixer.
Monday, July 21, 2025 Report this
Yeti1981
@jimlazar...Respectfully, Jim, this framing is misleading and counterproductive if we care about long-term affordability.
You suggest that a "cooling economy" and reduced demand might be a silver lining for our regional housing market, but let's be honest: rooting for economic stagnation as a housing solution is a risky and regressive approach that hurts working families far more than it helps.
Here’s why:
1. Affordability through scarcity is not sustainable.
Yes, vacancies ticked up, but so did rent for many lower-income households. A short-term vacancy bump doesn't mean housing is suddenly affordable, especially for people below median income. If we rely on economic decline to stabilize rents, we’re effectively accepting higher unemployment, stalled wage growth, and disinvestment as policy tools. That’s not a “solution," that’s a warning sign.
2. Suppressing demand isn't a moral or economic answer.
The idea that we should hope fewer people want to live here, in a region with good schools, job opportunities, and natural beauty, flies in the face of inclusive, forward-looking planning. Are we really suggesting that the answer to our housing crisis is to tell young families, job seekers, or immigrants to go elsewhere?
3. Increasing supply doesn’t inherently raise costs.
Yes, developing more difficult sites can be costly, but the idea that all added supply drives up prices is just false. In fact, when we build more of all types of housing, including duplexes, ADUs, townhomes, and mid-rise apartments, we create options, reduce competition for limited stock, and take pressure off prices across the board. That’s Econ 101.
4. Data bears this out.
The National Bureau of Economic Research, Harvard’s Joint Center for Housing Studies, and the Up For Growth coalition have all found that increasing supply, especially in high-demand areas, helps reduce rent burdens and improves affordability for lower-income renters. Scarcity helps landlords, not renters.
Bottom line:
We don’t fix housing by hoping the economy slows down. We fix it by removing barriers to building, encouraging smart growth, and ensuring our communities remain accessible to the next generation. Prosperity and affordability are not mutually exclusive, unless we choose to pit them against each other.
Let’s not.
Monday, July 21, 2025 Report this
RondaLarsonKramer
@Yeti1981, you make some good points. I'd like to add another in line with Jim's comments. A modest slowdown that tames inflation can benefit working families by stabilizing food, gas, and rent prices. Example: The Fed’s rate hikes in 2022–2023 cooled price growth, which helped low-income households regain purchasing power. Not all “cooling” is a crash. A soft landing (slower growth without recession) might improve affordability (e.g., housing) without major job losses. However, a sharp downturn (like 2008) or regional contraction (if local industries suffer disproportionately) would hurt working families much more than it would hurt families with more resources.
But you're right that this is not a long-term solution to housing affordability. I would like to suggest a better solution: smaller homes--like condos (I can't take credit for this--it's Jim's idea). The first home I bought was a condo. Because it was only 900 square feet, it was relatively affordable.
Legal and policy reforms are needed to enable more condominiums. Thankfully, some of that is happening now, and the City of Olympia's zoning is changing with this latest comprehensive plan update to allow more duplexes, triplexes, fourplexes, courtyard apartments, ADUs, and co‑living units.
But more changes need to happen legally. Washington has one of the most developer-unfriendly condo liability laws in the country. The Washington Condominium Act (WCA) holds developers liable for construction defects for up to 4 years after discovery, potentially much longer in practice. Even small defects can lead to class-action lawsuits by condo owners' associations. As a result, developers are wary of building condos. They prefer to build apartments, where they retain ownership and control risk. (The origin of Washington’s strict condominium liability laws can be traced in part to widespread construction defects in condo buildings during the 1980s and 1990s, many of which were caused by out-of-state developers using inappropriate building designs for the Pacific Northwest climate). Also, apartment buildings are easier to finance and sell (to investors or REITs), whereas condos involve individual buyers, longer marketing periods, and more regulatory steps. So, developers can make more predictable profits with rental apartments.
Tuesday, July 22, 2025 Report this