Amazon sent shock waves through Seattle in September when it announced plans to spend $5 billion to build HQ2, a second Amazon headquarters, to house 50,000 employees in another — probably distant — city.
Our prospects for becoming a global metropolis suddenly seemed much diminished. Like Boeing’s decision to move its corporate headquarters to Chicago and build a commercial airplane manufacturing plant in South Carolina, Amazon’s declaration left us feeling betrayed — and wondering why Amazon feels compelled to make such a radical move.
One answer: The second bullet point in Amazon’s request for proposal from potential suitors expresses a preference for “a stable and business-friendly environment.” Business friendly, Seattle is not.
Soon after Amazon’s announcement, John Burbank, the Economic Opportunity Institute’s executive director — who helped the Seattle City Council draft its recent income tax legislation — blogged: “Amazon has been a sociopathic roommate, sucking up our resources and refusing to participate in daily upkeep. Yesterday, the roommate announced that instead of making us do all of its chores, it will outsource some of its laundry to another city. Good.”
Seattle, with its diverse economy, will certainly survive this blow, as it has Boeing’s shrinking presence. What it may not survive is the rapid implementation of new regulations that make it harder and harder for businesses to operate in this city even as investments in transportation and infrastructure lag.
In retrospect, Amazon’s decision to expand elsewhere is understandable. The company is expected to generate $172 billion in revenues this year, roughly $100 billion more than in 2013. During the same four-year period, its worldwide employment has quadrupled — to 400,000. Seattle would be hard pressed to accommodate such a large company continuing to grow at a rate of more than 20 percent annually.
What’s unsettling is Amazon’s decision to call the new expansion “HQ2” and insistence that it will be equal in importance to operations in Seattle. It suggests a weakening commitment to Seattle and is particularly painful because Amazon has recently become civically engaged in Seattle in a major way.
In fact, significant community involvement and major contributions to such nonprofit organizations as Mary’s Place and FareStart led our judges to select Amazon as a Community Impact Awards honoree in the large company category this year (see more on the awards in our November issue).
I suspect the judges would make the same choice today. Amazon’s decision to build its campus in downtown Seattle has been a huge gift to the city. The company created 40,000 high-paying jobs close to public transit. More than half of Amazon’s employees get to work on foot, by bike or on a bus. Amazon spends an astonishing $5 billion per quarter on research and development, attracting the kind of top talent every city hungers for. That talent has prompted more than 80 other companies to establish engineering offices here.
While these well-paying jobs have widened the wage gap, they’ve also created thousands of jobs for writers, graphic designers, photographers, marketers and countless others. What a luxury it is that our children don’t have to move to other cities to find work.
Yes, many complain of the endless congestion and construction. We should be so lucky. If the anti-business attitude of Burbank and others around the Seattle City Council continues, the virtuous cycle of economic growth could reverse and become a downward spiral that spins off unemployment and despair.
Then we’d really have something to complain about.