Former Washington Gov. Christine Gregoire says the evidence is clear that the region is losing financial advantages, and leaders need to also lose their complacency in order to reverse the trends.<\/p>\n
\u201cWe have lost our competitive edge,\u201d Gregoire, the CEO of Challenge Seattle, told KOMO News. \u201cWe have tremendous assets, but the warning signs are very, very clear.\u201d<\/p>\n<\/p>\n
In an exclusive interview in advance of the Monday release of a new report, Gregoire says local elected leaders need to come together to advance a strategy to keep existing employers in the four-county region of King, Pierce, Snohomish and Kitsap counties.<\/p>\n
Starbucks expects to create up to 2,000 support jobs over the next five years at a new $100 million Nashville office, including by moving some select teams from Seattle. Amazon, meanwhile, plans to leave another South Lake Union office when its lease expires next year. The companies\u2019 decisions reflect different business strategies, and neither has said Washington taxes or regulations alone drove the moves. Starbucks has said Seattle will remain its global headquarters.<\/p>\n
But Gregoire says the Puget Sound can no longer assume major employers will automatically choose the region when they decide where to add jobs, invest, or expand.<\/p>\n
The new Challenge Seattle report says central Puget Sound lost nearly 7,000 jobs in 2025 while employment continued to grow nationally. The report says the decline followed two years of stagnant job growth and marks the first annual regional job loss outside a major recession or pandemic in at least two decades.<\/p>\n
The report, Keeping Puget Sound Strong: A Regional Plan for Jobs and Opportunity<\/a>, calls for the counties to address what it describes as mounting threats to the region\u2019s competitiveness.<\/p>\n \u201cIt\u2019s all about jobs. That\u2019s what we need to be focused on,\u201d Gregoire said in an interview. \u201cAnd in order to do that, we\u2019ve got to make us more affordable. We\u2019ve got to make us much more competitive than what we currently are.\u201d<\/p>\n The report says Washington\u2019s overall business ranking fell from first to 11th between 2017 and 2025, while its cost of doing business ranking dropped from 32nd to 47th. It also points to Washington\u2019s lowest in the nation five-year business survival rate, slower venture capital growth than peer regions, and a 5.2% unemployment rate in central Puget Sound, which is a little over a percentage point above the national rate.<\/p>\n Gregoire acknowledged that current Gov. Bob Ferguson is correct that some indicators remain positive, including Washington\u2019s overall business ranking of 11th. But she said the long-term direction should concern business and political leaders. Gregoire was governor between 2005 and 2013, and that period included legislation to provide Boeing with significant tax breaks to keep jobs in Washington, which was later extended and enhanced under Gov. Jay Inslee<\/a>.<\/p>\n \u201cA decade ago, we were number one,\u201d she said. \u201cBut the warning signs cannot be denied when the business climate is ranked as it is, when the corporate taxes are what they are, when the regulation stacking is what it is.\u201d<\/p>\n The report argues the problem is not one tax, one rule, or one local policy. Instead, it cites the cumulative effect of higher costs, new regulations, housing and child care affordability pressures, and what it calls a weakening culture of partnership between government and employers.<\/p>\n It says state and local business taxes have risen sharply since 2020, while state rulemaking has increased too. The report claims “State agencies adopted approximately 71 percent more regulations last year than in 2015. Washington is now the eighth most regulated state in the country with more than 200,000 state regulations on the books.”<\/p>\n Gregoire said businesses need to be able to plan. <\/p>\n \u201cThey make decisions based on: can we expect what is going to happen tomorrow in our place where we are right now?\u201d she said. \u201cIf we can\u2019t, then they look hard at, should we stay, should we expand here, or go elsewhere?\u201d<\/p>\n Starbucks has said its Nashville location will complement the Seattle headquarters. The company said most support teams will remain in Seattle, but some teams will move as Starbucks seeks to be closer to suppliers, a growing talent pool, and future store growth in the South and East. But reportedly, some of the layoffs were connected to employees who refused to make the move to Nashville<\/a>.<\/p>\n