Amazon’s Seattle growing pains offer lessons to new HQ hosts
As Amazon SEATT L E turns its attention to setting up new homes in New York City and Arlington, Va., experts and historians in Seattle say both places can expect a delicate relationship with the world’s hottest online retailer.
The communities will be subject to outsized influence from a company accustomed to getting what it wants and unfazed by blame, fairly or not, for widespread changes all around.
Just look to the Pacific Northwest, where both Amazon and Seattle have transformed dramatically together and sometimes at odds over the past 24 years — prompting resentment among a certain crowd of wistful “mossback” natives.
But there is a key difference.
The New York City and D.C.-area picks allow the company to strategically sidestep and diffuse many of the growing pains Amazon has been accused of inflicting on its Seattle hometown. That’s because the pending moves will shift Amazon from the “MVP” employer role it plays in Seattle, to a mere “VIP” employer position in two of America’s largest, most robust locales.
A Fitch Ratings analysis notes that 25,000 Amazon jobs would amount to less than 1 percent of the labor force in either New York City’s or D.C.’s metropolitan statistical area. Both also already have a large concentration of personal incomes in the six-figure bracket.
In Seattle, Amazon’s workforce has grown from 5,000 to 45,000 employees since 2010, while its physical footprint in the downtown core has grown from 1 million to 8 million square feet.
Matthew Gardner, chief economist with the Windermere Real Estate company in Seattle, estimates that Amazon’s crew of highly educated, well-paid techies makes up about 15 percent of downtown Seattle’s total workers.
Amazon says it spent $4 billion developing its Seattle home after claiming the once-sleepy South Lake Union warehouse district that’s unofficially rebranded “Amazonia” because of the company’s 44-building (and counting) development spree.
The company says it has infused $38 billion into the city’s economy between 2010 and 2016.
The downtown core today is a bustling employment center that is complemented with extra bus routes subsidized by Amazon, which claims that half its employees walk, bike or take public transit to work.
The area is also buoyed by blue-badge Amazon workers having lunch in small local eateries and food trucks outside. The Downtown Seattle Association says that more than 2,000 small businesses have opened in downtown Seattle since Amazon showed up.
That’s also meant a steady blockade of construction work in pockets of downtown, which also coincides with major traffic congestion caused by two long-overdue public transportation projects on Interstate 5 and Highway 99. Critics also lament Seattle’s metamorphosis from a modest blue-collar region fueled by timber, fishing and factory jobs to the city’s status as a star tech hub that was cemented by Amazon and then drew Facebook and Google to set up key outposts here.
Seattle’s new concentration of highly educated, well-paid techies infused in a post-Great Recession era has contributed to a vicious housing market. As a majority of them are young and single renters, Gardner said average city rents have increased by more than 70 percent since 2010, to nearly $2,000 a month. Meanwhile, the average cost of a single-family house has increased by nearly 90 percent to an average price of $844,000.