Amazon’s New Headquarters
Amazon recently announced that they were looking to expand their company by adding a second headquarters in North America. By doing this they are estimating an addition of 50,000 jobs and an ultimate net worth of $5.5 billion (Palmer). Cities across North America are placing their bids and trying to bring the headquarters near them. They want this because it will definitely increase employment and create jobs for many individuals in their city. While there are mostly benefits for the city by bringing the new Amazon headquarters to them, some Seattle residents (where the only headquarters are now) do make it know that there are negative impacts to it. Despite any negatives, however, 50,000 jobs is an extremely large number of employment and therefore this will outweigh many other options.
Scarcity of land will definitely impact the future of the Amazon headquarters. Although Amazon desires a metro location, they will have to find a city where there is space to build. Many cities are already very populated and built on top of each other and since Amazon desires 50,000 extra jobs, there needs to be a place in which their headquarters are easily accessible to these individuals. When making their decision they will encounter many trade-offs as they will find perhaps in one city the space to build, however they may have poor transportation alternatives which could defer a labor force for the company. They will have to evaluate the gravity of the opportunity cost of each option to determine where the best location will be. This video actually explains the benefits certain cities have, however this also showcases the opportunity costs for the selected cities that we can infer based off the difference in benefits for each.
Despite the large investment, Amazon realizes that by establishing a new headquarters growth will increase. Their company will be responsible for the 50,000 added jobs in our country. Amazon estimates that the average wage for workers at the new headquarters will be $100,000 so these would greatly increase the economy of a city. With more workers who are being paid substantial amounts, they are bound to increase their sales and efficiency as a company overall. Amazon wants to continue to increase technology and propose innovative ideas all the while increasing the success of the Amazon company. As seen in the chart below Amazon revenue has skyrocketed in the previous years and is continuing to grow showing the that with the new headquarters this will simply be a helpful aid among their growth.
While many news sites try to predict which city Amazon will choose--ranging from Denver to Washington D.C. to Atlanta--no one truly knows what Amazon will decide. CEO, Jeff Bezos will have to weigh the options according to his own standards to identify the future of the headquarters. The decision will likely take some time as cities across the US continue to bid for the new headquarters, each explaining why their city would be the best option. It is however said “some locations make more sense than others” (McFarland). The opportunities for the company are endless, but so are the options for locations for the new headquarters. Wherever this new investment takes place, however, will bring growth to the company no matter the location.
The negatives however do exist to the situation. Wherever Amazon decides to establish themselves, the local businesses will likely suffer. Additionally for other residents of the city that are not employed by Amazon will most likely face increases in cost of living such as increase in house costs as well as more traffic throughout the city (Lutz). Despite these negative impacts, overall the city will become wealthier and have a greater employment rate. The benefits outweigh the negative impacts and this explains why cities across North America are placing their bids.
cnbc. “Here Are The Cities That Match Amazon's Wish List For Its Second Headquarters | CNBC.” YouTube, YouTube, 8 Sept. 2017, www.youtube.com/watch?v=HuNb4wSmiZI. Accessed 24 Sept. 2017.
Lutz, Ashley. “Cities are in a vicious, $5 billion battle over Amazon's headquarters - here's why they're crazy.” Business Insider, Business Insider, 13 Sept. 2017, www.businessinsider.com/amazon-headquarters-battle-2017-9. Accessed 24 Sept. 2017.
McFarland, Matt. “8 cities fit for Amazon's second headquarters.” CNN, 11 Sept. 2017, www.npr.org/sections/alltechconsidered/2017/09/18/551773552/cities-try-convincing-amazon-they-re-ready-for-its-new-headquarters. Accessed 24 Sept. 2017.
Palmer, Annie. “Why Amazon Is Building a Second Headquarters Worth $5.5 Billion.” TheStreet, TheStreet, 10 Sept. 2017, www.thestreet.com/story/14297542/1/why-amazon-is-building-a-second-u-s-headquarters-worth-5-5-billion.html. Accessed 24 Sept. 2017.
Tulsa, Mayors from Toronto to. “8 cities fit for Amazon's second headquarters.” CNNMoney, Cable News Network, 11 Sept. 2017, money.cnn.com/2017/09/11/technology/amazon-cities/index.html. Accessed 24 Sept. 2017.