Washington’s Climbing Cost of Living: Statewide Impact and New Data

This story was written by Jerry Cornfield

with Washington State Standard.

In the past decade, Washington has become

one of the most expensive states to live in.

Drawing from an array of federal and state data,

a new analysis shows the state's cost of living,

rising faster than the national average over that time,

with only California, New Jersey, Hawaii,

and Washington, D.C. considered more expensive in 2023.

The 12-page Prices We Pay Report,

produced by the Washington Roundtable in concert

with researchers at the consultancy, Kinetic West,

details the areas where Washington is becoming less affordable.

Its authors don't suggest actions to bend the curve,

instead hoping the data will inform decision-making

by public and private sector leaders.

We have to understand what's driving these cost pressures,

said Rachel Smith, president of the Washington Roundtable,

a voice for senior executives of major businesses.

No one sector can solve this challenge alone,

Smith said in a statement.

After all, government doesn't set the price

of your refrigerator repair or your dinner out,

and businesses don't set tax or regulatory policy,

but those decisions are deeply connected.

Future reports will explore ways to address affordability.

Smith said that for now,

Washington should endeavor to be average on tax policy,

rather than the high bar for the nation.

We can't continue to have the only business

and occupation tax in the nation,

alongside some of the highest rates

for combined state and local sales taxes,

capital gains, estate, and now income taxes on high earners,

without those costs showing up

in the rising prices families pay every day, she said.

Each year, the US Bureau of Economic Analysis

measures the differences in price levels

across states and metropolitan areas

for its regional price parities index.

This data allows comparisons of buying power

from state to state or one metro area to another

for a given year.

Price levels are expressed as a percentage

of the overall national level, which is set at 100.

Washington recorded a 108.5 score in 2023,

the most recent year assumed in the Washington Roundtable Report.

It put Washington as the fifth most expensive place.

When the 2024 index was released in February,

Washington scored dipped slightly to 107,

and it dropped to sixth most expensive,

as New York moved into the top five.

Washington scored 103.2 in 2011,

putting it at 13th most expensive.

The Seattle Tacoma Bellevue region

ranked as the fifth most expensive

metropolitan area nationwide in 2023,

trailing San Francisco, Los Angeles,

Santa Barbara, and Oxnard Ventura,

all of which are in California.

Washington's other 11 metropolitan statistical areas

or MSAs landed in the top 25% most expensive nationally

per the report.

An MSA is defined generally by a central city

and surrounding counties that share jobs, commerce,

and daily travel.

The story is consistent across every measure.

Costs are high, rising quickly,

and showing up in the everyday decisions people make,

said Mark Cassali, CEO of Connecticut West,

the studies lead research partner.

Consumer spending is one barometer

of the climbing cost of living examined

by Connecticut West researchers.

Overall, the level jumped from $40,650 per capita

in 2015 to $62,837 in 2024.

Of the spending, 59% is on essentials

of housing, utilities, food, healthcare,

and transportation per the report.

This trend may be a factor in why more people

moved out of the state than moved in between 2021 and 2023.

Washington lost 153,174 residents

and gained only 97,781 new residents,

a net loss of more than 55,000 people,

according to the report.

Arizona, Idaho, and Texas were the top destinations.

Washington Roundtable in Connecticut West

next plan to examine how the cost of doing business

in the state has changed over time

and how those costs ultimately affect families.

From there, they intend to make recommendations

on bending the cost of living curve.

The affordability challenge is real, measurable,

and growing, Smith said.

It didn't happen overnight,

and getting out of it won't happen overnight, she said.

This report was first published

by the Washington State Standard.