Yesterday, the Washington State Economic and Revenue Forecast Council released the November revenue forecast, which projects the state general fund will grow by $191 million in the 2023-25 biennium compared to the September forecast. State general fund revenue is expected to total $66.88 billion in the 2023-25 budget cycle, which began July 1, 2023. This reflects a 3.3% increase over 2021-23 revenue.
Additionally, the Workforce Education Investment Account (WEIA) increased by $5 million for the 2023-25 biennium with total revenue projected at $843 million. WEIA funds many higher education priorities such as faculty and staff compensation, student financial aid and support services, and high demand degree programs.
The growth was driven by higher personal income and employment. Washington employment has increased by 5,700 jobs since September and the October unemployment rate remained low at 3.8%. The state’s all-time low unemployment rate was recorded this past September at 3.6%.
However, revenue collections are slowing across the board and consumer price inflation in the Seattle-area continues to exceed the national average, with the Seattle-area seeing inflation rates of 4.8% compared to 3.2% nationally. Rising interest rates also create instability in the commercial real estate market, business investment, and consumer demand. Forecasters will monitor these potential threats to the economy, as well as the impacts of the ongoing conflicts in Ukraine and the Middle East.
This is the last revenue forecast before the start of the 2024 legislative session in January. Governor Jay Inslee will use the forecast to help draft his proposed 2024 supplemental operating, capital, and transportation budgets, which are expected to be released in mid-December.
The November economic and revenue forecast can be found on the Washington State Economic and Revenue Forecast Council’s website here.