In the late 1990s, Red Delicious apples flooded the market, but there was not enough demand for the state’s dominant variety. Consumers wanted new varieties, and exports fell because of the economic crisis in Asia.

That led to low prices for farmers and one of the Yakima Valley apple industry’s darkest periods. Jobs tied to the region’s major crop were lost, and Yakima County’s unemployment rate — which reached 14 percent in 2002 — was well above the state rate, even during the industry’s peak months in late summer and fall.

The job and income losses accelerated efforts in the last decade to diversify the Yakima Valley’s economy. Questions about what could serve as Yakima’s version of Boeing — an industry that provides a lot of well-paying jobs — hung over the heads of economic development officials for many years.

Some diversification efforts were successful. Wal-Mart opened a distribution center in Grandview, and Ace Hardware, looking for a better distribution facility than the one it had in Yakima, decided to relocate to new quarters in Moxee rather than leave the Valley. Plastics and metal fabrication companies grew.

But other nonagricultural sectors spiraled downward. Hundreds of lumber and plywood workers lost their jobs at mills that were no longer economically viable. Record-high gas prices contributed to the demise of Western RV and TrailWagons/Chinook RV, two recreational vehicle manufacturers.

Call centers and back-office operations, which at first offered hundreds of new jobs to the Yakima Valley and promised even more, came and went — though some remain.

By 2008, the country was in a recession. Finding Yakima Valley’s own version of Boeing proved elusive.

Meanwhile, agriculture not only maintained its position as the No. 1 industry — both in terms of jobs and Yakima County’s standing as the state’s largest apple-producing county — it grew stronger.

One reason is that agriculture has undergone great changes since the 1990s. Premium commodities such as sweet cherries and wine grapes increased. Apple growers responded to consumer demand by growing fewer Red Delicious apples and more varieties such as Cripps Pink, Gala and Fuji. Farmers here and elsewhere changed out older orchards with new ones that have higher densities, leading to an increase in production — from 85 million boxes statewide in 2001 to 129 million boxes last year — on fewer acres.

The agriculture-driven economy still has its critics for the preponderance of low-wage jobs, but economic development officials believe the Valley’s agricultural industry is an asset that could draw other companies, such as plastics manufacturers and food processing plants, that provide jobs at higher wages.

Indeed, agriculture kept the Yakima Valley from sinking deeper during the recession and has contributed to an overall increase in jobs over the last several years. In 2011, Yakima County employers reported an average of 101,233 jobs, an increase of 7.7 percent from 2004, according to the state Department of Employment Security. The increase mirrors the rise in population during the same period.

With some exceptions, record yields, increased exports and better-quality products enabled farmers to get a good return on their crops and employ more workers.

Agriculture jobs in Yakima County grew by nearly 20 percent from 2004 to 2011 — the last full year for which the state has reliable employment and wage data — when nearly one out of every four people was employed in the industry.

Those figures don’t include jobs in other sectors tied to the ag industry, such as food manufacturing, transportation and wholesale trade, which include positions in fruit packing houses.

With the increase of controlled atmosphere storage facilities, which allow apples to be kept longer and still taste fresh, more of the crop could be sold year round. As a result, agriculture employment has become less seasonal over time, said David McFadden, president of New Vision, the county’s economic development arm.

While Yakima County’s unemployment rate has remained high since the recession started in 2008, especially during the winter months, the rate never reached higher than 12.4 percent, below the 13-14 percent range seen a decade ago and 16-17 percent in the mid-1990s.

“I’m not surprised our cycles of unemployment and seasonality is not as volatile as it used to be,” McFadden said.

But many would like to see the Yakima Valley buoyed by other industries, because many of the jobs in agriculture are low-wage. While the agriculture sector made up about 25 percent of the county’s jobs in 2011, it generated just 17 percent of the county’s annual wages.

But with agriculture adopting new technologies, there will be a need for people to be trained in skilled jobs that generally pay better, said Patrick Baldoz, director of the South Central Workforce Development Council, an agency that uses state and federal funds to provide job training in Yakima, Klickitat, Kittitas and Skamania counties.

Such employment includes jobs for testing different pesticides, developing mobile applications to help farmers manage water and pesticide levels for their orchards, and researching best practices for growing and harvesting crops.

“We’re talking about what makes that industry healthy from start to finish,” Baldoz said. “It’s not just the people who go out on the field harvesting.”

Outside of agriculture, Yakima County has seen job gains in several other sectors.

Health care has been a growth sector for the last several years and is expected to provide more jobs to meet the demands for services created by the expansion of Medicaid and other facets of federal health care reform.

The sector peaked in 2010 with 13,002 jobs, but the 12,931 jobs reported a year later was still an 18.5 percent increase from 2004.

Retail jobs received a boost from additional stores at the Valley Mall in Union Gap. By 2011, retail made up nearly 10 percent of all jobs in the county, though many of those jobs are part time and provide a lesser percentage — 7.8 percent — of the county’s wages.

And while nonfood manufacturing as a whole has declined — a 38 percent drop since 2004 to 4,525 jobs in 2011, due largely to the loss of wood products and recreational vehicle manufacturing jobs — some manufacturing segments have added jobs or remained steady.

Two of those — metal fabrication, and plastics and rubber products manufacturing — provide everything from replacement parts for fruit packing lines to parts for Boeing jetliners.

In nearby counties, the employment picture varies.

Kittitas County remains dependent on public sector jobs such as those as Central Washington University. With 1,300 jobs on the Ellensburg campus, it’s the largest employer in the county.

But the county also has seen job growth in accommodation and food service as officials have worked on marketing the area to tourists.

Ron Cridlebaugh, director of economic development for the Kittitas County Chamber of Commerce, said the area has benefited from conferences and events at CWU.

And that sector should grow even more as Suncadia, the vacation resort in upper Kittitas County, bounces back from the recession, he said.

With 13,467 jobs reported in 2011, Kittitas County is still below its recent peak employment of 13,966 in 2008. But the number of jobs has increased by 7.8 percent from 2004.

Lightly populated Klickitat County once was dependent on jobs in the timber industry and an aluminum smelter south of Goldendale. But when the plant closed several years ago and the timber industry continued to decline, the county looked to other sectors.

One such sector is renewable energy, a visible force in a county where wind turbines line the hills and ridges above the Columbia River, east and west of U.S. Highway 97.

In 2011, jobs for two subsectors — utilities and repair and maintenance, which includes positions in the renewable energy industry — totaled 192, an increase of 32 percent from 2004.

The county has also seen hundreds of well-paying jobs from Insitu, a drone manufacturer in Bingen that was acquired by Boeing in 2008. The company employs 800 people, with about three-fourths of those in Klickitat County. Additional jobs have come from businesses that provide various professional and technical services to Insitu.

“There are new and innovative things that have cropped up there,” the South Central Workforce Development Council’s Baldoz said.

In 2011, Klickitat County averaged 6,879 jobs, a 16 percent increase from 2004.

The South Central Workforce Development Council recently developed a strategy to train workers for several industries it believes will see job growth and provide good wages.

Those sectors include agriculture and food processing; health care; plastic and metal fabrication manufacturing; clean technology and renewable energy (such as wind farms); distribution and truck transportation; professional and business services; warehousing; and construction.

Though the inclusion of construction may appear odd given the sector’s decline in the last few years, Baldoz said construction employment has started to bounce back. And with the sector skewing older — many workers are in their 40s and 50s — there will likely be demand for new workers in the years to come.

Meanwhile, New Vision is again hearing from more companies interested in expanding since the end of the recession.

Most are food processing operations drawn by the dozens of commodities grown in the Yakima Valley, said McFadden, the New Vision president.

Yakima County may also benefit from continued growth in sectors such as aerospace. But McFadden said there’s plenty of competition for such companies, especially from Puget Sound communities that are closer to Boeing’s manufacturing facilities in Renton and Everett.

McFadden said new aerospace jobs could come by attracting employers that could provide services and parts to a company like CubCrafters, the Yakima-based plane manufacturer, or through the expansion of long-standing companies such as Pexco and GE Aviation, which provides parts for Boeing jetliners.

The Yakima Valley also would likely be more competitive in recruiting plastics manufacturers and distribution and warehouse operations.

“We make sense in these targeted industries because we have a concentration of them, or something that is really special or an asset to those companies,” he said.

• Mai Hoang can be reached at 509-759-7851 or at maihoang@yakimaherald.com.