For decades, Washington State and the cities of Redmond and Seattle have been the undisputed kings of American tech, fueled by Amazon's Seattle campus and Microsoft's Redmond empire. After explosive growth, the region now faces a "Big Tech reset" driven by AI efficiencies and mass layoffs.
The Seattle Times reports that Amazon alone announced 14,000 corporate cuts in October 2025, with 2,303 hitting Washington, 1,887 in Seattle proper. Microsoft has slashed over 3,200 Evergreen State jobs since May, part of 15,000 global reductions.
These aren't isolated pink slips. They're symptoms of a broader shift in the way the tech industry hires. Tech employment in Washington fell 6% from mid-2022 to early 2025, even as the national economy added jobs.
Entry-level roles for workers under 25 plummeted 13%. AI is rewriting code and shrinking headcounts. Microsoft now generates 30% of its lines of code automatically.
Worse, companies aren't just trimming; they're relocating. Amazon is shifting thousands from Seattle's high taxation hostile business environment to Bellevue campuses, consolidating Eastside growth while Seattle's payroll shrinks.
Estimates show the move will cost Seattle $6–12 million annually in lost payroll-expense tax alone.
It’s not all limited to Seattle though, TikTok's parent ByteDance cut 65 Bellevue positions after expanding there only four years ago.
State filings reveal the human cost: over 600 software engineers laid off in Amazon's latest round, mirroring Microsoft's AI-driven engineering purge.
Remote workers also face ultimatums, relocate to hubs like Seattle or lose the job, yet many refuse and exit entirely.
Why are businesses leaving? Washington's business policy, especially Seattle, is toxic for business. We rank 45th in business tax climate in the US, burdened by the nation's only gross-receipts B&O tax, a 9.9% capital gains excise, and Olympia’s $9.4 billion tax binge signed by Governor Ferguson.
New service sales taxes under SB 5814 crush small tech consultancies already reeling from big-tech cuts.
Even with all of this, there is discussion in the halls of Olympia about a 9.9% income tax on business owners and high earning individuals.
The result? Seattle ranks 12th nationally for outbound moves in 2025 PODS data.
Families and firms vote with U-Hauls, heading to low-tax havens like Tennessee and the Carolinas. When Jeff Bezos decamped to Florida, Washington forfeited $610 million in capital gains tax one swoop.
Washingtons entrepreneurs are some of the brightest and most inventive in the US. They generate massive amounts of jobs, personal income opportunity and secondary benefits to the region, including a seemingly unending ability to increase tax collections for the state. However, it’s a symbiont relationship. While businesses generate taxes for the state, Washington has to reciprocate with a business-friendly environment for those businesses to succeed. Any dip in tax revenue from a cut in business taxes and regulation will be offset with increased taxes when those businesses grow and generate more revenue.
The reverse is also true, like a bar of soap, the harder the state squeezes, the more businesses with leave and find other ways to be profitable.
Policymakers must act. Slash the B&O, repeal the capital-gains wealth grab, and freeze new service taxes. Streamline permitting so startups can build without drowning in red tape. Only then can we keep the next Amazon from becoming the next exile.
Seattle’s tech crown is slipping. Without bold reform, Washington's reset button will not read so much about “turn out the lights”, but "Game Over."
