Tech layoffs hit Seattle hard as Meta, Oracle slash workforce amid AI ramp up

Another wave of layoffs hit Washington’s tech sector, as Oracle and Meta cut hundreds of jobs in the Seattle area, the latest signs of a shifting economy already under pressure from developments in artificial intelligence, rising costs, corporate pullback, and a new state income tax.

Oracle laid off 491 Seattle-area employees Tuesday, part of broader cuts affecting thousands across the company as it pours billions into artificial intelligence infrastructure while facing investor pressure and a declining stock price.

The layoffs hit workers at two downtown Seattle offices, though the locations will remain open. Still, Oracle’s footprint in the region continues to shrink. The company has now cut 757 Seattle-area jobs over the past year and has already reduced office space and exited its Bellevue location.

Oracle is not alone. Meta confirmed another round of layoffs on Monday, affecting 168 Washington workers, primarily in Seattle, Redmond, and Bellevue. The cuts, set to begin in May, impact engineering, product, recruiting, and management roles, with Reality Labs taking a major hit.

That follows earlier rounds this year, including 331 layoffs in January and more than 100 cuts last fall tied to Meta’s AI restructuring. Microsoft, Amazon, and Meta have collectively cut thousands of jobs, with total tech layoffs in the Seattle area now exceeding 20,000.

Companies are redirecting massive amounts of capital away from employees and into infrastructure, data centers, GPUs, and cloud systems, in a race to stay competitive in the next phase of the tech economy.

But the layoffs are colliding with another major policy shift in Washington. State Democrats recently passed a 9.9 percent income tax on earnings above $1 million, marking a significant departure from Washington’s long-standing no-income-tax structure. Gov. Bob Ferguson signed the measure into law on Monday, which rewrites the state’s entire tax code in what many assume is an effort to tax everyone in Washington eventually.

Critics warn that the timing could not be worse. High-income tech workers, the very people being laid off or facing job uncertainty, are also among the most mobile. Entrepreneurs and investors have already begun relocating to lower-tax states like Texas and Florida. Venture capitalists report investors changing their domicile, while a recent survey found 44 percent of Washington business leaders are considering leaving the state, citing taxes and cost pressures.

The shift is also visible at the corporate level. Starbucks is relocating its corporate office to Nashville and closing stores in Seattle, while opening new locations elsewhere. The coffee giant’s founder, Howard Schultz, announced he was relocating to Florida the same day Democrats passed the new wealth tax laws without a single Republican vote. Office vacancy rates in downtown Seattle now top 33 percent, and commercial property values have fallen sharply.

Even Seattle’s sports economy has been pulled into the conversation. Seahawks leadership has warned the new taxes could hurt recruiting, while discussions about bringing back the NBA’s SuperSonics have included concerns about investor, sponsor, and fan relocation.