tech sector tremors hit seattle

In recent weeks, another round of tech-sector layoffs added to the rolling wave of workforce reductions that had persisted throughout 2025. Meta, the sixth-largest employer in the City of Bellevue and one of the largest tech firms in the Seattle metropolitan statistical area (MSA), laid off over 300 employees across its local offices. Amazon, a top-five employer in the region, laid off 14,000 workers nationally in the last week of January, 2,000 of which were here in the Seattle region, where it is headquartered.

For some time now, tech sector layoffs have consistently featured in news headlines as companies digested large workforces that followed from a period of frenzied hiring during the pandemic years of 2020 and 2021. Many of these firms have acknowledged that amid the fierce talent wars of that era, they had overextended themselves and are now focused on what they've termed "right-sizing." The massive resource demands of the generative AI race has also certainly contributed to this, forcing companies to cut operational costs in other areas. Yet until more recently, these tech layoffs, while attention-grabbing, were not materially large enough to noticeably impact the overall labor market in the Seattle metropolitan area.

That is no longer the case, with the unemployment rate in the Seattle MSA reaching 5.1% in November, climbing a full percentage point from 4.0% a year earlier. This increase has outpaced the national trend, which has itself sparked concern among economists as hiring numbers weakened over the second half of 2025. Nationally, the unemployment rate started at the same 4.0% level in November 2024 but has reached just 4.5% in the most recent release.

That the national employment rate rose just 0.5 percentage points compared to Seattle's 1.1 percentage points over the same period reflects the local region's particular reliance on the tech sector. Over the 2025 calendar year, 13,144 employees in the Seattle MSA were laid off according to the WARN system.

—the Worker Adjustment and Retraining Notification Act, which requires employers to provide advance notice of significant layoffs—with 6,857 (52%) coming from tech firms alone. Among the 56 US metros with populations over one million, only eight saw greater increases to their unemployment rates over this period. The total number of layoffs has also nearly doubled from 2024's 6,586, underscoring the broader trend of a weakening national labor market.

It's a reversal for the local economy, which since the pandemic has seen both employment rates and wage growth largely outperform the national picture. For the local housing market, this strength has supported purchasing power and buyer confidence. While mortgage rates have seen limited downward movement from their peak, wage growth in the Seattle region has outpaced inflation since late October 2024, adding cushion for homeowners managing mortgage payments and lifting prospective buyers’ budgets. 

Looking ahead, however, a rising unemployment rate will dampen wage growth and add to the uncertainty already facing buyers and sellers contemplating a move into the housing market. If the labor market has become a central focus for the national economy this year, it will be even more so here at home.