SEATTLE — “Scary,” “nervous,” “sad,” are all words used by experts, analysts, and realtors to describe recent rounds of layoffs at tech companies like Amazon and Meta, combined with reporting that more could be on the way.
Starting Monday, 2,303 Amazon employees will have their final day with the company, part of the layoffs announced in October. In March, Meta will lay off 331. Last week, Reuters reported that another 16,000 Amazon employees could lose their jobs. KIRO 7 reached out to Amazon to confirm, but a spokesperson said Amazon is not commenting on the report. If that’s true and the same proportion of workers in Seattle are laid off as were in the October announcement, it could mean an additional 2,600 freshly unemployed workers.
“I am very nervous about what’s happening,” said Joe Nguyen, the President & CEO of the Seattle Metropolitan Chamber of Commerce, “I think there’s a lot of uncertainty, we’re competing globally, and we don’t have an environment right now where I think the political community and the business community are working very well together.”
It comes as the Washington Employment Security Department notes that 16,835 more people are unemployed this year than last, with 111,845 people in the Seattle-Bellevue-Tacoma region searching for work.
“This is kind of the scariest time economically for the Seattle region since the Great Recession in 2009. We’ve just become accustomed to growing at a lightning pace, and it’s not clear if and when we’re gonna grow like that in the near future, said Jeff Shulman, the Chair of the University of Washington’s Marketing and International Business Department.
Both Shulman and Nguyen believe the layoffs at Meta and Amazon are two-fold—finding “efficiencies” in business to increase profitability while AI platforms and investments change longer-term strategies.
“It’s a sign of strength to be able to make cost-cutting moves. Eliminate bureaucracy, and become more efficient at earning profit and value for your shareholders.” Shulman said.
For Kimberly Shaeffer, a realtor at John L. Scott Real Estate, Amazon clients made up the majority of her business.
“They have fueled my business, and they’ve fueled the economy,” Shaeffer said.
Though in the last year, she’s noticed a dramatic shift. Relocation clients used to flood her desk looking for places in Seattle. Last year, though, of the 23 relocation clients they had, 21 moved out of Seattle, including former Amazon employees.
“It’s sad to hear when there are any job cuts and just trying to understand how that’s going to affect our overall city and not only housing, but also businesses or downtown,” Shaeffer said.
Shaeffer doesn’t believe that Amazon workers leaving the region will be enough to drop down home prices, as she says single-family homes are still seeing multiple offers per listing. However, the growth that Amazon brought also changed the kind of housing around Seattle to prioritize more density, and she thinks that momentum could hit the market within the next year.
Downtown visits hit 97 percent of pre-pandemic levels, according to the Downtown Seattle Association, while business traffic was at 60 percent of where it was in 2019. Shaeffer says many of the downtown workers she had as clients also worked in the downtown core.
“As companies grapple with emerging trends, we hope this pain is short-term. It would be unwise to bet against Seattle in the long run – the talent pool and fundamental assets are in our favor. The health of our city requires that downtown must be a competitive and attractive place to not only visit and live, but also to locate a business and to grow jobs,” said Jon Scholes, the President and CEO of the Downtown Seattle Association.
Shulman says diversifying the region’s economy away from tech reliance, like what the city’s economic makeup looked like historically, is crucial.
Nguyen sees plenty of opportunity in that in the aerospace, satellite, and space technology, AI, quantum mechanics, and one of the more naturally beautiful regions all work in Washington’s favor. The important piece he sees is lawmakers taking a ‘do no harm’ approach that can make the situation worse.
“We have very good fundamentals and ingredients in this area to be very successful going forward. The part that makes me nervous is that you have to invest in those areas. Economic development is kind of a new thing to talk about within this particular region, just because you’ve been able to have so much success with the organic nature of the work that’s being done. But that’s going to be changing.”Nguyen said.