For many job seekers, WA job market still far from a pre-pandemic norm

For all the celebratory claims of a “soft landing” for the U.S. economy, the job market in Seattle and Spokane, as elsewhere, is still marred by sluggish growth and strikingly uneven outcomes.

On the upswing are workers like Seattle resident Sue Alexander. The 55-year-old early education teacher is one of thousands of education workers to find jobs in a sector that is seeing strong hiring after several slow years.

When Amazon, Microsoft and other tech firms started cutting thousands of jobs in late 2022, “it rocked a lot of people’s worlds,” says Heather Thompson, a technical program manager who found a new job 11 months after her contract with Microsoft ended last year.

Granted, despite the recent cuts, tech employment is still around 12% ahead of where it was before the pandemic.

But because tech has become so central to the local economy, the downsizing has had spillover effects in related sectors.

“I’m just swimming in a sea of recruiters looking for work,” says Cami Smith, who just landed a three-month contract position after her employer, a recruiting company focused on the gaming industry, closed last fall.

Another weak spot: hiring for management positions fell by around 5% in 2023. And many senior workers who responded to a Times callout worried that their age was making their job search harder.

“I’ll keep applying but I’m not holding out hope that anyone one will hire me in tech,” said Larry, a Seattle area resident in his 60s who lost his IT job last summer.

Mark Mattke, CEO of Spokane Workforce Council, said job seekers on the other end of the age range are facing headwinds as well.

There are “issues with the number of people that are in the workforce from different demographic groups,” Mattke said. “We’re seeing less young people in the labor market and more older workers.”

Even hearing back on some inquiries is rare.

“Honestly, I’m lucky if I get even a rejection email,” says Madeline Van Slyke, a 22-year-old Eastside resident who graduated last spring with a degree in data science from Willamette University in Salem, Oregon, and has yet to find work despite applying to dozens of jobs.

Mattke said this has resulted in “generational phenomenon” of young people opting to stay at home instead of pursuing a career.

There are “record numbers of people that are living with their parents,” he said. “It used to be called ‘failure to launch’ and now it’s more of a decision to save money and to take a job that young adults want to work at that offers the time that I can go and do recreation and things that are important to them.”

Half speed ahead

Relief is coming for job seekers like Van Slyke, though it may not be as soon as they’d prefer.

Hiring in Washington is expected to grow by just 1.1% in 2024, versus 2.4% in 2023, according to the latest forecast by the state’s Economic and Revenue Forecast Council.

The forecast, which looks ahead to 2027, sees hiring grow by 0.6% in 2025 and rising to 0.9% by 2027.

Still, that bleak prediction carries better news for some sectors.

Hiring in aerospace manufacturing, for example, will remain strong through 2025, though it will slow substantially by 2027, according to the state forecast.

Construction hiring, by contrast, will remain sluggish next year, but is expected to rebound starting in 2026.

Tech, too, can expect improvement. Hiring for software jobs will be flat in 2024 but will rise to around 1.5% starting in 2025, according to the forecast. (Even now, Amazon and Microsoft are second and seventh, respectively, among the Top 10 Washington employers by November job openings.)

Mattke, of Spokane, said occupation groups with the highest projected new job growth in Spokane by 2025 is transportation and warehousing at 16%, computer and mathematical jobs at 10%, management occupations at 8%, construction at 7% and health care and social assistance at 6%.

There are other causes for optimism, economists say.

Unlike past downturns, which tended to clobber every employer in a given industry, this slowdown has left pockets of hiring even in hard-hit sectors.

For every employer who is laying off, “there might be a firm across the street … that’s actually hiring,” says Josh Wong, a recruiter manager at Addison Group, a professional services firm with offices in Seattle.

Similarly, while hiring fell at many big-name tech firms, demand for tech workers actually stayed relatively high at non-tech firms, says Megan Slabinski, who oversees regional hiring for technology, marketing and creative roles with the Seattle office of recruiter Robert Half.

Finally, despite slowdowns in specific sectors, Washington’s overall unemployment rate of 4% is still quite low – just two tenths of a percentage point above where it was in January 2020.

That reflects a job market where workers “still are more likely than not to be able to connect with work,” says Vance-Sherman, the state economist.

Similarly, the state’s relatively high “quits” rate indicates workers are still confident they can find a better job. “There’s a lot of optimism,” Vance-Sherman says.

High quit rates prove it is truly a job seekers market, Mattke said.

“Job seekers are doing a lot more picking and choosing after the pandemic,” he said. “People are looking at jobs that give them flexibility, high enough compensation, the kind of benefits that they want, and opportunities for career growth.”

Even so, it’s clear many job seekers have had to adopt different strategies than they might have even two years ago.

Smith, the recruiter, says job seekers may need to resign themselves to contract work or other short-term jobs at least temporarily.

With the economy recovering, employers “still need us,” Smith says, but “they’re just not ready to bring us back full time.”

Lyon, the construction project manager, is also taking on short-term projects, and is broadening his search to include design and architecture firms and government jobs.

For Blain Howard, 46, who was laid off from a tech marketing job in late 2023, surviving today’s highly competitive market job takes a tougher mental attitude.

The Seattle resident recently saw a job opening at Airbnb “that was up for two days and had 950-plus applicants already.”

Howard’s response has been to stay focused and disciplined, with 9-to-5 workdays Monday through Friday and up to five applications a day.

In today’s economy, Howard says, “getting a job is a job.”

Alexander says openings in 2023 were plentiful – and the job she recently accepted, at the YMCA Early Education Center in Woodinville, pays better “than any other position I’ve held.”

Mattke said openings in the Spokane region are common in most industries. Finding employment is more determined by an job seeker’s experience.

“Someone who’s got a credential and health care, they’ve got a job; someone who wants to work on a construction site, they’ve got a job; someone who wants to work in transportation, warehousing, they’ve got a job,” he said. “Really, it’s dependent upon the job seeker.”

It was a very different year for Justin Lyon, a 46-year-old construction project manager.

Last October, the Renton man joined the thousands of construction workers laid off in 2023 as the industry’s pandemic recovery was derailed by inflation, high interest rates and falling demand.

“You read the paper and it says, ‘The economy is booming – there’s jobs everywhere!’ ” Lyon says. “They’re not here – not for me.”

These two very different takes show just how far from “normal” the Seattle-area job market remains nearly four years after COVID-19 upended the economy.

The good news: in 2023, hiring in Washington grew at a slightly faster pace than it did in 2019, as inflation and interest rates eased.

The less good news: hiring last year likely was still only around half the rate of 2022, according to state data.

And the latest monthly data, from November’s preliminary estimate, shows the first monthly job loss since July, with unemployment ticking up to 4% versus 3.6% in September.

Certainly, in many industries, such as education, aerospace manufacturing and retail, hiring is rebounding from pandemic-era losses.

But others, such as construction and tech, employers actually reduced head count, often substantially.

While “it’s not ‘sky is falling,’ ” there are signs employment growth “is weakening,” says Anneliese Vance-Sherman, state economist with the Employment Security Department.

Indeed, in a job market that was once so hot employers were practically begging for applicants, many job seekers now wait weeks and even months to hear back from employers – if they get any response at all.

And that fragmented job market is likely to continue well into 2024, forecasters say.

Taken as a whole, Washington’s “labor market still tilts in favor of [job] seekers,” says James McCafferty, co-director at the Center for Economic & Business Research at Western Washington University.

But in some sectors, McCafferty concedes, “it may not feel like it.”

Making up lost ground

As in 2021 and 2022, some of last year’s biggest hiring came in industries that were hit hard by layoffs early in the pandemic or suffered high turnover due to pandemic-related stress.

Hiring was especially strong for education jobs by government and private employers, which together accounted for around 14% of the state’s net job growth in 2023, according to seasonally adjusted data from the state Employment Security Department for the 12 months ending in November.

Also strong was hiring by health care-related employers, which saw massive turnover during the pandemic, and which accounted for around 36% of the state’s net job growth in the same 12-month period.

As of November, two of every five openings in Washington were for nurses or other health care workers, state data show.

Sabina Uber, a longtime nurse who has worked in the behavioral health unit at Bellevue’s Overlake Hospital, says most candidates today can expect multiple offers and even hiring bonuses, which wasn’t the norm before the pandemic.

“I’m going to be 65 this year and I’m still being solicited for work, which … before COVID would never have happened” Uber said.

The tight health care job market continued to bring challenges for employers.

It took three months to find a single dental assistant last year for Ryan Lemke, a dentist who runs a Seattle practice.

“These days, pretty much everyone I know is short staffed,” says Lemke.

Hiring has also been strong in other industries hit hard by the pandemic.

Aerospace manufacturers such as Boeing added around 8% more jobs in 2023, but are still around 9% below their pre-COVID employment. Hiring by apparel retailers was up around 7% in 2023, but is still 15% below pre-COVID levels.

Nearly 1 in 10 openings in November were for retail jobs.

Hiring by hotels, also slammed by COVID, was strong in 2023 as tourism continued to recover.

Seattle-area hotels especially did well from a record-setting cruise season and major events like the MLB All-Star Game. As of November, hotel employment was up 6.5% compared to November 2022.

But overall, hotel employment is still 8.5% below pre-pandemic levels and many employers would happily hire more.

At the Renaissance Seattle Hotel in downtown Seattle, between 5% and 10% of positions remain unfilled, particularly “the entry level positions that we really count on,” says general manager Juergen Oswald, who is also president of the Seattle Hotel Association.

This has forced businesses across different industries to compete for workers of the same income bracket, Mattke said.

“Employers are much more thoughtful about what the different ways in which they can build a culture that is appealing to the workers they’re trying to attract,” he said. “Over the last couple of years, company culture has become one of the defining factors that businesses are identifying that’s going to draw job seekers and retain them.”

Cold and quiet

For all that hiring, the 2023 job market will likely be remembered more for the sectors that lost ground.

Two of the biggest losers: construction, which shed 2% of its workforce, and tech, which shrank by around 6%.

The tech layoffs were especially notable given the sector’s prior performance: After years of strong hiring, including during the pandemic, tech jobs had come to be seen almost as recession-proof.

Spokesman-Review reporter Tod Stephens contributed to this report.