Downtown Seattle Association ‘sounding the alarm’ on stalled job growth amid record number of residents

On a sunny weekend, downtown Seattle is sure to be packed, whether people are enjoying the market or the waterfront, but what about during the week?

Jon Scholes, president of the Downtown Seattle Association, told “The Gee and Ursula Show” on KIRO Newsradio there are some encouraging signs and some troubling trends about the state of downtown.

“Total visitors last summer were higher than what we saw in 2019, so you look from April to September, there’s an incredible amount of activity in downtown Seattle, and the rest of the year is a little softer from where we were in 2019, so sort of the tale of two seasons,” Scholes said.

He added that there are more people living in downtown Seattle than ever before.

“We lost a couple thousand people through the COVID years, but we gained them back, plus many more, and today, there are a record number of people living downtown — one in eight Seattleites calls downtown Seattle home,” Scholes said.

But one of the biggest challenges right now is job growth. Scholes said in the 15 to 20 years before the pandemic, downtown Seattle saw record levels of job growth, but over the last four years, that hasn’t been the case. Meanwhile, just across the water, Bellevue’s job growth has been rising.

“I’m not rooting against Bellevue by any means, but I’m certainly rooting for Seattle, and sort of sounding the alarm here that we are not attractive right now to employers that are growing and expanding within the region,” Scholes said. “They’re picking the east side of the lake, not the west side of the lake, and that has significant consequences and impacts to the commercial office values in downtown.”

According to Scholes, the top 10 most valuable buildings in downtown Seattle are now worth less than half of what they were just four years ago. Therefore, the property tax burden that was carried by commercial buildings for so many years has been shifted to residents and small businesses.

“We have to be more competitive and recognize that companies have choices on where they want to grow and locate, and there are great reasons to be here, but right now, the tax structure is creating a situation where Seattle is an outlier, and people are making other choices,” Scholes added.

Downtown Seattle’s path back to job growth starts with city leaders

So, how does Seattle bring its business back? Scholes said it starts with changing the atmosphere created by city leaders.

“It first starts with the tone and tenor of city officials to business, to employers,” he said. “‘We value you. We want you here. We want to make downtown Seattle, whether you’re a retailer, a restaurant, or a large employer, medium employer. We want to make it easy for you to locate and grow here. We value you here.’ And that’s not been the message over many years in our city; we have to be more upfront about that.”

Scholes said there also needs to be better predictability about taxes and regulations.

“It seems like every other day, you pick up a new story, and there’s a new tax, or a tax that was recently raised that they want to make higher, or a new regulation. And so there’s not great predictability,” he said.

Scholes noted there is a significant payroll tax that was put in place four years ago and increased, along with increases in the B&O tax on large employers.

“We’ve become a tax outlier in our region, and people are making other choices,” he said.

In her State of the City address in February, Seattle Mayor Katie Wilson highlighted the business community and employers for investing in the city.

“I think she’s sent some important signals,” Scholes said. “And the fact that she’s asking her departments for 5% to 10% cuts to the city budget to deal with their overspending, I think is the right approach, but time will tell, and we’ve made a lot of progress downtown, but this progress is tenuous.”

Watch the full discussion in the video above.

Listen to Gee and Ursula on “The Gee and Ursula Show” weekday mornings from 9 am to 12 pm on KIRO Newsradio.