Seattle-Area Workers 38% More Productive Than the U.S. Average

In March 2023, the Puget Sound Business Journal reported on a McKinsey & Co. study of labor productivity, which the study defines as economic output per hour worked. It found that Seattle-area workers were 16% more productive than the national average in 2007, and that the gap had widened to 38% by 2019.

The metro’s real gross domestic product per employee reached $172,437 in 2019, the third-highest in the country, and the area produced about two-thirds of Washington’s GDP. San Francisco and San Jose also pulled ahead over the 13 years the study covered. McKinsey ended the study period in 2019 to keep pandemic effects out of the data.

Washington ranked second among states for labor output and productivity growth in 2019. The average Washington worker produced $82.89 of real output per hour that year, up from $64.52 in 2008, and the state was one of seven with above-average productivity and labor output over the study period. Charles Atkins, a McKinsey partner and one of the report’s authors, told the paper the numbers were a good story for both the state and the city.

The report set those gains against a national slowdown. U.S. productivity grew an average of 2.2% a year from 1948, but only 1.4% a year since 2005. McKinsey estimated that a return to the long-term rate by 2030 would add $10 trillion to U.S. output, about $15,000 per household.

Eastlake Real Estate Partners develops apartments in the Seattle metro. More about how the firm looks at this market is on the investors page.

This is our summary. The full article by Neetish Basnet appeared in Puget Sound Business Journal on March 31, 2023.