Dozens of elected officials, business leaders, and economic development advocates gathered on Seattle’s waterfront Monday with a shared goal: to keep the region from slipping into economic decline.
Led by the nonprofit Challenge Seattle, the leaders launched the new “Partnership for a Competitive Puget Sound.” The partnership is meant to be a unified voice across business and the public sector on economic development issues.
Challenge Seattle CEO and former Gov. Christine Gregoire, along with other speakers, warned the Puget Sound area lost jobs in 2025 for the first time in decades, the region’s unemployment rate is higher than the national average, and its place in various rankings of business-friendliness have fallen.
“This is for us a wake-up call,” Gregoire said during a press conference to launch the partnership. “We cannot resort to relying on yesterday’s success while tomorrow’s jobs go somewhere else.”
As part of the announcement, Challenge Seattle published a playbook with recommendations for local governments to support businesses. The organization is pledging $1 million to the effort, and this fall, it plans to invest $500,000 into an initiative to help cities speed up permitting. The partnership’s goals also include advocating for reduced or simpler business taxes and improving the job pipeline between local colleges and employers.
Microsoft President Brad Smith called out Seattle’s JumpStart payroll tax as a policy that has alienated employers. JumpStart taxes the total payroll expenses of the city’s largest and highest-paying employers.
“ It is really a tax on tech jobs, and that’s why you’re seeing more tech jobs move from Seattle to places like Bellevue and the Eastside,” Smith said. “Interestingly, as this decade began, San Francisco abolished its payroll tax, and then, Seattle added one. You should tax things you want to discourage, like cigarettes, not jobs. And especially in the world today, let’s face it, we need people to succeed to some degree in a world of AI. You don’t want to make the cost of employing people more expensive at the same time that AI is increasingly adding its own new form of competition.”
Advocates for the tax note it has raised hundreds of millions of dollars for affordable housing and helped plug city budget holes.
Seattle Mayor Katie Wilson is among JumpStart’s supporters. She played a key role in its design and ultimate passage, according to her campaign site. The mayor has faced criticism in the past for being antagonistic toward the business community, but more recently, Wilson has appeared to strike a more amicable tone. Last week she signed an executive order aimed at supporting the city’s startup community. Wilson also spoke at the launch event Monday.
“ I think we all recognize that this is a fragile moment, and that the time to act is now,” she said.