A new survey finds nearly a quarter of Washington employers are weighing a move out of state, nearly triple the rate from 16 months ago. Washington employers are signaling growing dissatisfaction with the state's business climate, with a new survey revealing sharp increases in the share of business owners considering leaving the state entirely.
According to a recent Association of Washington Business survey, 24% of employers are now actively considering relocating their business out of state, a figure that has nearly tripled compared to results logged 16 months earlier. Meanwhile, 55% of Washington employers said they are weighing a move of their personal residence out of state, up from 44% earlier this year.
The driving force behind the discontent is clear: 72% of employers cited the state's overall tax burden as a top challenge. Washington has long relied on a sales tax-heavy structure in the absence of a personal income tax, but recent years have brought additional levies, including a capital gains tax upheld by the state Supreme Court in 2023 and a payroll-based long-term care insurance premium that drew significant pushback from businesses.
The findings come amid a broader national conversation about state competitiveness, as high-tax states face increasing scrutiny from employers and residents comparing costs across state lines. Neighboring states including Idaho and Nevada continue to market themselves as lower-tax alternatives for both businesses and individuals.
For South Sound employers, the survey reflects frustrations that have been building for several years. Small business owners in Tacoma and Pierce County have pointed to the cumulative weight of state and local tax obligations, rising labor costs, and regulatory compliance as factors squeezing margins in an already challenging post-pandemic environment.
The Association of Washington Business, the state's largest business association, has used the survey data to press lawmakers for relief, arguing that the trend lines represent a warning signal for Washington's economic future. Whether the Legislature responds in upcoming sessions remains to be seen, but the numbers suggest the window for action may be narrowing.
