SEATTLE — For years, Seattle enjoyed seemingly endless growth that was fueled by the tech boom, but city leaders warn that this may no longer be the case, pointing to recent layoffs at multiple large companies.
City leaders say Seattle can’t wait for things to change and that the city needs to get involved to grow its economy.
“Our city’s economy can perhaps best be described today as being sluggish in Seattle,” said Downtown Seattle Association President John Scholes, bluntly.
He said job growth has stayed flat over the past five years. Construction cranes – that once dotted the skyline – have all but disappeared and the office vacancy rate stands at 36.5%, according to the real estate tracking firm Cushman and Wakefield.
A new report by the Seattle Office of Economic Development found that Seattle has relied too heavily on large, high-tech firms that are now shedding jobs.
The report found that from 2014 to 2023, firms with 100 or more employees generated 74.5% of Seattle area’s job growth. Firms with 20-99 workers generated only 16.6%.
“The rise of AI has introduced deep uncertainty to the future of the tech sector. This is not uniquely a Seattle problem, but it creates special vulnerability. For a city whose economy is so heavily dependent on a sector that’s undergoing a fundamental restructuring,” said Mayor Katie at a news conference on Wednesday, where she signed an executive order to set up a task force.
The panel plans to determine how best to grow and support not only large companies, but businesses of all sizes- exploring everything from investment to streamlining permitting processes. Initial recommendations are due in February.
“I want businesses small, medium, and large to be successful in Seattle. And there are many things we know that we can and must do,” Wilson said.
Scholes says it’s a step in the right direction but adds that Seattle could learn from its neighbor across the lake, Bellevue.
“I think they’ve offered a more predictable environment, a more cost-competitive environment, and I think their tone and tenor has been one that’s been positive toward employers,” Scholes said.
Bellevue has gained a more business-friendly reputation than Seattle. Bellevue’s office vacancy rate is only about 23%. Its unemployment rate is 4.5%, compared to Seattle’s 5%.
©2026 Cox Media Group
