‘WE’RE NOW THE WALMART OF TECH WORKERS ‘
CITY OF VANCOUVER’S PITCH TO AMAZON DRAWS FIRE
Vancouver officials are defending their decision to tout the bottom-barrel pay of the city’s tech workers in their bid to get online retailer Amazon to build a second headquarters on the West Coast, saying it was one of their “strongest economic arguments.”
After the 50-page bid proposal was posted online last week, many local observers questioned why, in the midst of a housing affordability crisis, the city would boast that its tech workers have the “lowest wages of all North American tech hubs.”
It’s as if the city is telegraphing to the world that its tech workforce consists of only cheap talent as opposed to good talent, said Andrew Yan, director of the City Program at Simon Fraser University.
“Great, we’re now the Walmart of tech workers in North America — cheapest prices ever,” Yan said. “That’s a great place to start selling yourself.”
But the person who oversaw the bid package said unlike other cities, Vancouver — already home to over 1,000 Amazon employees — was not prepared to offer tax incentives to the online giant, so it needed to draw attention to other enticements to create a “best-value proposition.”
“As much as we are working with the region’s key stakeholders to increase wages in Vancouver, the reality is that we are the lowest-cost tech hub in North America, and it would have been a huge error not to include one of our strongest economic arguments in the proposal,” James Raymond, manager of research and analysis at the Vancouver Economic Commission, said in an email.
Raymond added that low cost does not mean low quality, stressing the city’s tech workers are “rated as some of the most talented and qualified anywhere.”
The debate, of course, is now inconsequential; Vancouver is no longer in the running to be the home of Seattle-based Amazon’s second headquarters, dubbed “HQ2,” which is expected to employ as many as 50,000 people.
Only one Canadian city, Toronto, made the shortlist announced last month. Its 192-page bid proposal similarly touted how its tech workers could be had for a “fraction” of the wage cost compared to other North American cities.
Vancouver’s proposal included to-be-expected references to the city’s natural surroundings, cultural diversity, socially progressive outlook, eco-consciousness and top-tier learning institutions.
Amazon was urged to think of Vancouver as Seattle’s fraternal twin — a “home away from home” whose close proximity would minimize Amazon’s carbon footprint.
The submission suggested four possible sites for a new Amazon campus — two in Vancouver and two in the suburbs of Richmond and Surrey.
A list of incentives designed specifically for Amazon included a new provincial program to “provide permanent pathways for Amazon workers to live and work in B.C.” Several other incentives, however, were redacted from the document released to the public at the request of the province.
What got a lot of observers grumbling, though, was the bid package’s reference to Vancouver offering “more affordable wages for tech sector workers” than any other major city. The bid proposal cited an average salary for a software engineer in Vancouver as US$60,107 compared to $92,380 in Atlanta and $113,906 in Seattle.
“Actively promoting LOW WAGES … is nothing short of scummy and a disservice to ALL creative, tech & other workers trying to make a living in the #unaffordable city you’ve created,” one person tweeted to Mayor Gregor Robertson.
Another part of the bid package that drew guffaws was a section that touted how the region was “proactively leading the charge to tackle housing affordability” and that more affordable homes were “within reach.”
According to a recent report by the B.C. Real Estate Association, the average price of a home in Metro Vancouver was $1,036,968 in January.
Last month, a Royal LePage report stated that the median price of a condo in Metro Vancouver was $651,885 in the last quarter of 2017, an increase of 20 per cent from the previous year.
“We may be trying to lead in creating the affordable housing, but you know what? We’ve got an awful lot of leading to do before we get anywhere,” said Lindsay Meredith, a professor emeritus of marketing at Simon Fraser University.
Meredith said he can understand why members of the public might read the document and wonder, “‘Gee, I can’t afford to get anywhere near Vancouver and these guys are telling me they’ve got affordable housing.’ That’s the kind of stuff where you can get some backlash.”
Raymond said housing affordability is an issue facing many North American tech cities and that Vancouver officials wanted to highlight steps being taken to address it, such as the province’s introduction of a property tax on foreign ownership.
On the issue of salaries, Raymond added: “We know Amazon pays some of the best wages around, so bringing 50,000 jobs averaging US$100,000 would have been a huge boost to the salaries in our region.”
Based on feedback from the city’s Amazon contacts, Raymond said the bid proposal was “rock solid” and there is little he would change in hindsight. “We have some peace of mind knowing that it was the best possible proposal we could have put forward.”