PSBJ: Seattle job losses mount, forcing leaders to address policies

This story was originally published by the Puget Sound Business Journal on Sept. 30, 2026.

By Rick Morgan

As consensus forms around Seattle’s economic warning signs, a few troubling trends have come into focus.

Seattle lost 18,605 jobs between 2024 and 2025, including 13,000 in downtown, according to a report the Downtown Seattle Association⁠ released Wednesday.

The employment decline complicates the outlook for an office market that already has the nation’s highest vacancy rate. Office vacancies in Seattle have hovered around 35%, and worker foot traffic has languished at less than 65% of the pre-pandemic levels.

Acknowledging the need for action, Seattle Mayor Katie Wilson recently issued an executive order to expedite permitting and launched a task force to explore how the city can foster more small and midsize businesses. The executive order came on the heels of a report that found Seattle’s economy and tax base are too reliant on a few large employers.

Wilson followed up her executive order with a proposed budget that would close a $175 million budget deficit without any new taxes.

“Downtown Seattle is still the largest and most important employment center in our region, but these numbers are a clear warning that we cannot take that position for granted,” DSA⁠ CEO Jon Scholes said in a statement. “We need a renewed focus on growing our employment base, supporting existing businesses and making Seattle one of the best places in the country to start and grow a business.”

According to the DSA report, the Puget Sound region ranked 20th out of the 30 largest U.S. metropolitan areas in employment growth from 2019 to 2025. The average non-farm annual payroll in the region has gone up 1.7% during that time, which also ranked 20th according to economic data from the Federal Reserve Bank of St. Louis.

“Seattle has reinvented its economy many times, and we have every reason to believe we can do it again,” Scholes said. “This is about competing for the next generation of jobs and investment.”

Other cities in the metro area, such as Bellevue and Tacoma, are facing similar economic headwinds but still reported job gains. Bellevue picked up 5,375 jobs, and Tacoma added 662 jobs.

When seafood startup Shinkei was looking to plant its flag in the Pacific Northwest, it ended up buying a 16,000-square-foot processing plant in Tacoma because that was where it could get through the permitting and infrastructure update process quickly.

Amazon⁠, Seattle’s second-largest employer and the largest office occupier in the region, has essentially capped its growth in the city at around 49,000. The company set out to trim underutilized office space this year, hitting an already battered office market.

But across Lake Washington, Amazon is adding workers and opening new offices. It reported 15,700 employees in Bellevue last year, a 9% year-over-year increase. The company plans to hit 25,000 workers in Bellevue in the coming years.

Other Seattle-founded companies have wound down their presence in recent years.

Tax software company Avalara, for example, moved its headquarters from Seattle to Durham, North Carolina, in 2024, and the company’s local employment since that year has shrunk from 700 to 400.