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• By contrast, Washington State employed more than 4.8 million people across
<br /> 492 industries in 2023. Its normalized Shannon-Weaver Index was slightly lower
<br /> at 0.78, reflecting concentration in high-value industries such as aerospace,
<br /> software, logistics, and life sciences. These concentrations are features of a
<br /> HOW THE OLD HEAT PROJECT WILL ASSIST LOCAL high-performing economy, not vulnerabilities, because they are tied to innovation-
<br /> ECONOMIC DIVERSIFICATION EFFORTS intensive clusters with spillover effects and global market reach.
<br /> The Herfindahl-Hirschman Index (HHI), a commonly used measure of market
<br /> The diversification strategy described in this section directly advances Old concentration, underscores this point. The HHI is used to study competition,
<br /> Heat's four core objectives: creating high-wage employment, commercializing pricing power, and market efficiency. Kittitas County's HHI is 0.020, significantly
<br /> and diffusing technology statewide, reusing state assets efficiently, and higher than the state average of 0.012—a 67% greater concentration. This
<br /> modeling a replicable Eastern—Western Washington economic alignment. Each strongly suggests that Kittitas County's economy is over-reliant on a few low-
<br /> diversification pathway that follows illustrates how these objectives translate into wage industries and underexposed to the types of high-value clusters that
<br /> measurable local and statewide economic outcomes. generate economic resilience.
<br /> The Old Heat project is designed to reshape the structural trajectory of the Kittitas County's 2023 median wage was $65,208, while Washington State's
<br /> Kittitas County economy. Instead of relying on incremental changes within was$89,138. The low wages of the primary industries of the county combined
<br /> existing low-wage, low-growth industries, it introduces a catalytic platform that with the increasing costs of living make outmigration of highly skilled workers
<br /> shifts the region toward innovation-intensive, higher-value industries. Its purpose a significant challenge for the communities in the county. Table (1) shows
<br /> is twofold: to serve as an on-ramp for existing businesses to integrate advanced select industries of the county (food manufacturing, brewing, restaurants, arts,
<br /> technologies and become more competitive, and as a launch pad for new entertainment, and recreation), none of which provide salaries that support a
<br /> enterprises that build directly into state and national industry clusters. In this way, median-priced home in the region. This compares to the median wages of the
<br /> Old Heat strengthens diversification not simply by adding more sectors, but by focal industries of the Old Heat project (aerospace, communication technology,
<br /> embedding industries with the highest potential for wage growth, resilience, and agricultural machinery), all of which provide salaries that make median house
<br /> long-term economic impact. price purchases within reach of workers in the county.
<br /> CURRENT ECONOMIC STRUCTURE AND RISKS OLD HEAT AS A DIVERSIFICATION CATALYST
<br /> As of 2023, Kittitas County employed 25,377 individuals across 207 industries. Rather than trying to incrementally improve the economic ecosystem with its
<br /> On the surface, the Normalized Shannon-Weaver Index for the county is limited scope of lower-wage industries that are artificially suppressed by the
<br /> 0.83, suggesting a relatively even distribution of employment across sectors. absence of the high-wage industries prevalent in the larger Washington State
<br /> However, this masks a deeper structural issue: Kittitas County's employment is region, the Old Heat project creates a structural inflection point. It will diversify
<br /> evenly distributed across a narrow set of lower-value industries. These include the economy by introducing advanced industries into the regional ecosystem,
<br /> education, public sector employment, hospitality, and retail. These sectors embedding them within CWU-linked infrastructure, and building feedback
<br /> service the local economy but generate little outside revenue, which leaves the loops between business, workforce development, and applied research. This
<br /> region highly vulnerable to labor shifts, automation, and fluctuations in consumer diversification occurs through four interconnected mechanisms:
<br /> spending.
<br /> 54 1 Old Heat CERB Feasibility Study
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