Washington state employers are looking for the exit

Published 1:30 am Wednesday, May 13, 2026

Back in February, when the Association of Washington Business released a survey showing that nearly one in five Washington employers were looking to move business to another state — and almost half were considering moving their personal residences — it made headlines across the country.

Three months later, we have fresh numbers. And they’re not good. In fact, they should be viewed as a 911 emergency for this state’s economic health.

AWB’s spring employer survey of more than 400 employers found that 24% of respondents are now considering moving their business out of Washington, up from 17% last quarter and nearly triple what we found in our winter 2025 survey just 16 months ago. Eighteen percent are developing a relocation plan and 7% have secured a location out of state. The number of business leaders looking at moving their personal residence out of state is a staggering 55%, up from 44% last quarter. Fifty-nine percent say they’re looking for real estate in another state and 44% are consulting with a CPA or tax professional. In Spokane County, 67% of respondents said they’re considering moving their personal residence.

Let that sink in for a moment.

Will all these people follow through and actually move? Probably not. The largest share (35%) is just beginning to explore options. But it would be a mistake to dismiss these numbers and the frustration behind them. For starters, it takes a while to move a business or a personal residence, so we shouldn’t expect to see companies leaving overnight.

But even if only a fraction of these employers move away, it spells trouble for our long-term economic health. Just as concerning, the survey shows employers are far more likely to look to other states when they’re thinking about growth or expansion.

How do we turn the tide? In the short term, Washington’s policy leaders need to simply stop doing things that make it harder and more expensive to start, grow or run a business here. It’s no coincidence that interest in moving out of Washington spiked in the spring survey, which came out shortly after lawmakers passed an income tax that’s purportedly aimed at millionaires but will also hit many small- and medium-sized businesses.

In the long term, we need a pro-growth economic plan focused on making Washington a top state for creating, expanding and keeping a business. Other states are watching what we’re doing. They are keenly aware that by adopting an income tax, we just gave away one of our biggest competitive advantages, and they’re lining up to try to take as many of our businesses as they can. In the AWB survey, 17% of respondents said they had already been contacted by an out-of-state economic development official. We should put at least as much effort into keeping Washington businesses here as other states are investing in recruiting them.

Washington has long been a place where some of the world’s most iconic companies took flight, from aerospace to agriculture, software to coffee, and so much more. It’s easy to take our state’s historically robust economy for granted.

But the strong tax base provided by Washington’s diverse employers is by no means guaranteed, especially since years of over-spending in Olympia have put the state into a spiral of never-ending budget shortfalls that lead to higher taxes followed by more budget shortfalls. Two months after lawmakers adjourned the 2026 legislative session, we’re already being told to expect a multi-billion-dollar shortfall when lawmakers return to the Capitol in January 2027.

Unfortunately, lawmakers won’t have much in reserves to help solve the problem. Thanks to years of overspending, Washington now has the lowest level of reserves of any state in the country, a dubious distinction that state Treasurer Mike Pellicciotti likens to a big “check engine” light flashing.

Legislators need to break the cycle and get back to the old, boring work of writing a budget that lives within our means. Instead of raising taxes and overspending, let’s stop squeezing homeowners and businesses — and let’s start building back our meager reserves.

The alternative is to continue our boom-and-bust budgeting fueled by ever-increasing taxes.

Unfortunately, there will likely be ever-fewer employers here to pay them.