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Bellingham was officially incorporated on November 4, 1903. It was the result of the consolidation of four towns initially situated around Bellingham Bay: Whatcom, Sehome, Bellingham, and Fairhaven.Bellingham's proximity to the Strait of Juan de Fuca and to the Inside Passage to Alaska helped keep some cannery operations here. P.A.F., for example, shipped empty cans to Alaska, where they were packed with fish and shipped back for storage.

The mean annual salary of a wage earner in Bellingham is $37,990, which is below the Washington State average of $44,710.Adjusted for inflation, wages in Bellingham and Whatcom County have been declining for more than 30 years as service-oriented jobs gain prominence in the local economy, and goods production (mining, construction and manufacturing) decline as a share of total employment. Service oriented jobs now constitute at least 77% of all non-agricultural employment in Whatcom County.Between 1989 and 1999 median household income grew 41% in Whatcom County while housing costs grew 108% over the same period. In each year 1998–2000 the average wage in Whatcom County was not enough to afford a two-bedroom rental unit.For the year 2005, the median price of all homes sold in Whatcom County was $259,000 while the median price of homes sold in the Bellingham area was $269,000. This compares with a statewide median home price of $260,900.