This article is the first of two parts examining Washington Gov. Bob Ferguson’s executive order to form an economic development council involving 26 business, labor, energy and education leaders in the state to assess current and future economic conditions.
Part one will focus on the reaction from former Washington Governor, Christine Gregoire.
Part two, to be published tomorrow, will focus on reaction from four elected leaders in Everett.
OLYMPIA — Former Washington Gov. Christine Gregoire is praising current Gov. Bob Ferguson for announcing a new economic development council to address a mixed-bag of economic conditions but simultaneously says the state needs a “course correction” to provide “stability and predictability” for businesses.
Last week, Ferguson announced his formation of a 26-person economic development council of “leading Washingtonians across industries to identify practical actions that strengthen Washington’s economy, expand opportunity and help more Washingtonians succeed.”
The Governor’s council will include Stephanie Pope, President & CEO, Boeing Commercial Airplanes, Brad Smith, Vice Chair and President of Microsoft, David Zapolsky, Chief Global Affairs & Legal Officer for Amazon, Mike Katz, Chief Business & Product Officer at T-Mobile, Shane Tackett, President and Chief Financial Officer of Alaska Airlines. Joining the business executives are two construction and building trade groups, April Sims, President, Washington State Labor Council, AFL-CIO, two indigenous tribal leaders and two utility power company leaders, among others including the Presidents of The University of Washington and Washington State University.
“Frankly, I cheered,” Gregoire tells EverettPost.com, when she heard about Ferguson’s economic council announcement. “I think it’s exactly what the state needs right now. I think he has put together a really top-notch group of people to be at the center of creating an economic development plan for Washington State going forward.”
Gregoire formed a similar panel, the Global Competitiveness Council, in 2006 during her first term as Governor. “We decided that we need an economic development plan for the state,” Gregoire recounts, “because while we were recognized, not just nationally, but internationally (as an economic market), the competition was fierce, and that if we weren’t being thoughtful and planning, that we were going to lose out in in the competition (to other states, cities). Which meant that our people were not going to be able to get the jobs they needed and the jobs they deserved. And so our economy would not be what it could be. So, we undertook to create an economic development plan of our own.”
Pivotal Point
Today, Washington’s economy is exerting mixed signals. The state’s GDP recently surged to lead the nation with a 4.5% annualized growth rate. Over the last 12-24 months, Washington’s job market has cooled significantly, transitioning into a period of slow or stalled growth. The state’s sluggish job creation rate has resulted in an unemployment rate of 5.2%, falling below the national average and placing Washington tied for 28th among states for 12-month job growth.
Washington added only 2,300 net payroll jobs over the past 12 months, which equates to a nearly flat percentage gain, according to the U.S. Congress Joint Economic Committee. Washington’s unemployment rate is 5.2%–the second highest rate in the nation next to California–compared to the national average of 4.3%.
Business creation remains steady according to data, though venture capital funding has consolidated into fewer, larger deals. To start the first-quarter of 2026, venture capital saw $1.5 billion raised across 69 deals, the lowest deal count for Washington since the early months of the COVID-19 pandemic in mid-2020, according to Geekwire.com.
“We’re at a pivotal point,” Gregoire stresses, “where we can either take the challenges that we have on, work together, address them, and move forward so that people can get the jobs they want. So businesses can stay and thrive. Or we’re going to see ourselves falling behind in a fairly dramatic way, which is not good for the people of the state of Washington. ”
Course Correction
Asked about where Ferguson’s council should focus their efforts, Gregoire responds, “my ask of them was find a path for us to take a course correction to all work together and to become yet again the fierce economic competitor that we have been historically with great jobs for the people of the state and a quality of life second to none.”
“We need to look hard and fast at how complicated we have made it for us to be able to build affordable housing,” Gregoire expands. “To be able to get a permit to do just that. To be able to get the kind of permits necessary for a company to expand or a company to locate here. We have to take a look at the tax structure. Do we have a strategy? Are we stacking taxes from city, county, state, one on top of the other. Are we aware of the consequences of continuing growing taxes and continuing growing regulations and its impact on the people of the state and of the economic climate of the state.”
“We’ve got some tremendous assets as a state as a Puget Sound region. It’s no wonder we’ve been as competitive historically as we have been, but we’ve taken it for granted,” Gregoire laments.
What changed in Washington?
Queried about a moment in time where the state economy started to strain under the myriad decisions by state elected officials in Olympia, Gregoire quickly specifies a major budgetary vote in the Legislature, “The biennial budget before Governor Ferguson was elected really was an important point in which we began to accumulate the deficit that we can’t seem to get out from under. Which means that we have to take a look at what were we doing then? Were we spending more than we were taking in? Were we supporting programs that were really giving return on investment to the people of the state? Were we making sure that we had a tax structure that was simple, fair, and competitive?”
“That’s what I think this group of people the Governor’s put together are really going to have to take a look at. That particular biennial budget, I think, was troublesome and began us wondering whether we were on the right path.”
That biennial budget was 2021-2023, as Ferguson was elected in November 2024. The 2021-2023 budget totaled $64.1 billion. It was a 22% budget spending increase from the previous biennial budget from 2019-2021 which totaled $52.5 billion. From 2015-2017’s budget to the current 2025-2027 budget, state spending has more than doubled in 12 years from $38.2 billion (2015-2017) to $80.1 billion right now. While the state budget grew by 104% in that time frame, Washington’s population only grew 11.4%.
Gregoire cites the largest tax hikes in state history based on bills that were signed by Gov. Ferguson in May of 2025.
“When we talk about taxes, we have taxes at three levels. Have we ever looked at what those accumulative taxes mean for the individual who really is struggling to make ends meet now? And what’s the impact on them? What’s the impact on the small business where the profit margin is so small? Any additional burden on them suggest they can’t continue, and they need to go out of business. Those are the kinds of things we need to be asking ourselves and taking the kind of course correction that says, we’re going to have a regulatory, tax structure–both–that says it’s going to be simple, it’s going to be fair, and it’s going to be competitive.”
Capital Flight
Tax increases–like the recently passed ‘Millionaires tax’ and capital gains tax–have prompted critics of Gov. Ferguson and the Legislature to assert that high profile businesses leaders are moving out of the state for friendlier economic conditions. News reports have noted that Amazon founder, Jeff Bezos, and Starbucks founder, Howard Schultz, have both moved out of Washington–where they launched their respective companies–to Florida. Two other recent examples involve the co-founder of Zillow Group and Expedia Group, Rich Barton, who announced a relocation to Nevada and software developer Gabe Newell, who built Microsoft operating software and parlayed that into a video game platform, Steam, just purchased a $39 million mansion in Florida.
(Note: the ‘Millionaires tax’, SB6346, is being challenged in the initiative process to authorize a state-wide vote to keep or reject the tax that was passed by the State Legislature.)
Janicki Industries, based in Sedro Wolley, Wash., announced one month ago an $800 million expansion in Montana, instead of its Skagit County headquarters. The aerospace and manufacturing company predicts it will add 1,000 jobs within the first 5 years in Great Falls, scaling up to over 2,000 jobs upon completion. The project will add 2 million square feet of advanced composite, precision machining, and metal fabrication production space. Janicki’s expansion announcement presaged Gov. Ferguson’s economic council executive order by 24 days.
Gregoire’s answer about capital flight is pragmatic, “I don’t think there’s one tax that has resulted in people leaving the state…or expanding elsewhere. I don’t think that has to do with one tax. I think what it has to do with is the lack of predictability.” And, that, she says comes back to the necessity of the 26-person economic council. “Who knows what tomorrow will bring with continuing (state budget) deficits?”, Gregoire wonders aloud.
“So, I think we should look underneath,” these mobility decisions, Gregoire continues. “Why are people leaving? Why are companies not staying or expanding elsewhere? Ask those questions, which is what the governor’s Council will do. And come back with honest recommendations about how we change course, so that in fact we keep people in the state of Washington. I mean, if we want the revenue to address the kinds of challenges that we have, for example, affordable housing and homelessness. Then we can’t afford to have people leave the state. When they leave, they take their philanthropic giving, which is major, with them. And our philanthropies are serving people who really desperately need service.” But Gregoire concedes, “We have to ask, why are people leaving?”
Stability and Predictability
“Have we taken our economic prosperity for granted? All of us? And if that’s the case–and I believe it is–then we need to take a look at the competition,” like other states that are enticing ‘high net worth individuals’ like the innovation and tech CEOs, Gregoire infers, “and where our companies are going to go and ask ourselves, are we ready to take that on, work together, and make a course correction here?”
“Why are companies expanding elsewhere or leaving, and that’s what this Council, I think, is charged to do. That, is happening. Then, what do we do to take a course correction and make it so it doesn’t continue to happen. And one of the essentials to that is stability and predictability (for businesses).”
To that end, Gregoire shares, “So, what I hear business talk about a lot is, that while we keep addressing problems that everyone wants solved, for example, homelessness, or affordable housing, we keep putting more money after doing the same thing with little or no results. That is a frustration, as you can imagine with the business community and to the public at large. Because I think people absolutely want to address the homelessness issues that we’re facing, the affordable housing issues that we’re facing. They want those addressed, but they don’t want to keep putting more money in doing the same thing when the results are not what they need to be, should be, at all.”
That comes back to vision, according to the former Governor, “We do not have a strategy on our tax structure that meets the criteria of being simple, fair, and competitive,” Gregoire admonishes. “At the same time, we’re spending more than what we’re taking in. Hence, we have a deficit. The average family in Washington state cannot spend more than what they take in. The legislative bodies, city, county, state, really are called upon by the public to do exactly the same thing,” Gregoire reminds.
Gregoire feels optimistic that economic improvements are possible, “I think the data is clear that we have declined in competitiveness on a number of fronts that are not good for our people, not good for our business. So it doesn’t mean we can’t do something really big, really great, and get back to the kind of quality of life and taxation and regulations that we all want, that we all deserve.”
I Love My State
Gregoire’s treading rare terrain in her assertions about what’s plaguing the state economy and the business landscape in Washington. Former U.S. Presidents rarely critique sitting Presidents. Similar for governors and the deference that comes from former officer holders.
Gregoire spoke expansively in May about the current economic climate in the state during a keynote address in Vancouver, Wash. Video of that is linked here.
Gregoire tells EverttPost.com, “Yes, people are coming up to me at various and sundry places and saying, ‘thank you for what you’re saying.’ A lot. A lot,” she confides. She says people tell her, “‘That is exactly how I feel.’ ‘We’re glad that somebody spoke up and said it."”
She says she’s speaking up, “Because I love my state. And they do too. And they don’t want to have it where people leave. Or smaller companies can’t make it. Or families are struggling. They want the same things that we all do, which is a quality of life, economic prosperity, good jobs, and that means we have to have a real look at ourselves and ask, where are we now?”
Evaluating those political and economic trade-offs, Gregoire, revisits the work ahead for Ferguson’s new panel, “And what can we do going forward? Looking back isn’t going to help us unless it gives us information. But what we need to be doing is looking forward and saying, ‘okay, what do we do to make sure people don’t leave here’ because of the lack of predictability or various and sundry taxes.”
“Make sure that companies can continue to prosper and grow. Pay the taxes that allow us to provide the services to people who are in dire need of help. That’s what I hear. That’s who I am,” Gregoire emphasizes.
“That’s what I believe in, and that’s what everybody is coming up to me and basically saying the same thing I feel.”
Tomorrow, EverettPost.com will publish part two of this story which will include interviews with St. Senator June Robinson (D-Everett), St. Rep. Julio Cortes (D-Everett), Everett Mayor, Cassie Franklin, and Port of Everett Commissioner, Glen Bachman for their reaction and context to Ferguson’s economic development council.