Washington Employer Update: July Jobs Report and New Employment Laws to Know
Washington Employer Update: July Jobs Report and New Employment Laws to Know
As Washington employers head into fall, there are several workforce developments worth having on the radar.
Washington's unemployment rate declined in July after a long period of gradual increases, employers with 15 or more employees are now operating under expanded Fair Chance Act requirements, and another new state law takes full effect October 1.
Here’s a practical look at what Washington employers should know.
Washington Unemployment Drops to 5.0%
Washington's unemployment rate decreased from 5.2% in June to 5.0% in July 2026, according to the Washington Employment Security Department.
The state added an estimated 21,100 seasonally adjusted jobs in July, making it the third consecutive month of statewide job growth. Private-sector employment increased by approximately 22,500 jobs, while government employment decreased by an estimated 1,400.
The largest private-sector gains included:
Education and health services: +7,300 jobs
Leisure and hospitality: +2,700
Retail trade: +2,500
Professional and business services: +2,500
The number of unemployed Washingtonians actively seeking work also fell from approximately 209,400 in June to 202,900 in July.
There is an important year-over-year comparison, however. Washington's July 2025 unemployment rate was 4.6%, meaning unemployment remains higher than it was this time last year.
What Does This Mean for Employers?
The numbers suggest some improvement in Washington's labor market, but a 5% unemployment rate doesn't necessarily translate into an easy hiring environment.
The availability of qualified candidates can vary significantly depending on occupation, experience, location, schedule and compensation. Employers may see more applications while still having difficulty finding candidates with the qualifications needed for a particular position.
As businesses move into fall and begin looking toward year-end, now is a good time to review upcoming vacancies, anticipated seasonal needs and positions that have historically been difficult to fill.
Washington's Updated Fair Chance Act Is Now in Effect
Washington employers should also take another look at their hiring and background-check procedures.
Amendments to the state's Fair Chance Act took effect July 1, 2026 for employers with 15 or more employees. The amended requirements will apply to employers with fewer than 15 employees beginning January 1, 2027.
One of the most important changes involves when criminal-history information can enter the hiring process.
Generally, an employer must first determine that an applicant is otherwise qualified and extend a conditional offer of employment before asking about or obtaining information about the applicant's criminal record.
Employers should also be aware that:
Job advertisements cannot say things such as "no felons" or "no criminal backgrounds" or otherwise discourage applicants because of criminal history.
Job applications cannot ask applicants for criminal-record information.
Employers generally cannot automatically exclude an applicant solely because of an adult conviction record. An employer must have a legitimate business reason, as defined by the law, for taking an adverse action based solely on that record.
Before rejecting an applicant or denying an employee a promotion based on criminal history, the employer must identify the record being considered and generally give the person at least two business days to correct or explain it or provide information about rehabilitation, work experience, education, training or good conduct.
If an adverse decision is ultimately made, additional written documentation requirements apply.
There are exceptions for certain positions, including some involving unsupervised access to children or vulnerable people, law enforcement and criminal justice agencies, and positions where another law requires or permits consideration of criminal history.
For employers, the takeaway is simple: don't assume that an existing background-check process is still compliant.
This is a good time to review job advertisements, applications, interview questions, background-check timing and adverse-action procedures.
Washington Attorney General — Fair Chance Act guidance
Another Deadline Is Coming October 1
Washington's new Immigrant Worker Protection Act (IWPA) takes full effect October 1, 2026, creating new responsibilities for Washington employers related to certain federal immigration enforcement activities.
One of the key requirements involves Form I-9 inspections.
If federal agents provide an employer notice that they will inspect employees' employment-eligibility documents, employers must provide workers notice of that inspection within five business days.
The Washington Attorney General's Office has now released resources to help employers comply, including:
A required workplace poster explaining employee rights under the law
A model notice employers can use following notice of a Form I-9 inspection
A model notice for affected employees
Guidance regarding immigration agents' access to private workspaces and employee information
Materials in multiple languages
The AGO says the workplace poster should be displayed in an area visible to all workers.
What Employers Should Do Before October 1
Employers shouldn't wait until an I-9 inspection occurs to determine how to respond.
Before October 1, businesses should review the state's guidance, post the required notice, download the model forms and determine who within the organization will be responsible for responding if federal immigration officials contact the business or issue an inspection notice.
Managers and supervisors should also know where to direct those requests rather than attempting to handle an unfamiliar situation themselves.
Washington Attorney General — Immigrant Worker Protection Act resources and required poster
Heading Into Fall: A Good Time for an HR Checkup
September is naturally a transition point for many businesses. Summer vacations are winding down, schedules are settling, and organizations are beginning to think about fourth-quarter priorities and 2027 planning.
Along with reviewing staffing needs, employers may want to use that transition to review:
Job postings → applications → interview procedures → background checks → required workplace notices → year-end staffing needs.
A relatively quick review now can identify outdated processes before they become bigger problems.
HRI Is Here When You Need Us
Employment laws and workforce conditions continue to change, but one thing hasn't: finding the right person for the right position matters.
Human Resources Inc. works with employers throughout Mount Vernon, Skagit County and surrounding communities with temporary staffing, contract-to-hire, project staffing and professional recruiting.
Whether you're preparing for year-end workforce needs or unexpectedly find yourself with an open position, we're here when you need additional hiring support.
Human Resources Inc. of Mount Vernon
This article is intended to provide general information to Washington employers and is not legal advice. Employers should consult the appropriate state agency or qualified legal counsel regarding their specific circumstances.
