Sunday, January 21, 2018

To Many Movers And Shakers, Where Amazon Puts It's New Headquarters Is The Most Important Thing In The World


Amazon released the short list-- 20 cities-- they say they're considering for a second headquarters. Here's the list, not in alphabetical order, but in order of how many flights per day go to that city from Seattle, which doesn't seem all that important to me since if there's more demand, the airlines will put in more flights, but Geek Wire thinks this is a crucial consideration (and a reason to buy stock in Alaska Airlines). In any case, L.A. has 45 flights a day (and on 6 different airlines, which probably is something of a plus) and Columbus and Pittsburgh have no flights, although Alaska says they are adding a Seattle to Pittsburgh flight next fall.
Los Angeles
New York
Washington, DC
Montgomery County, MD
Northern Virginia
Interestingly, the Washington Post ran with a story by Andrew Van Dam on Saturday morning that looks at the momentous decision in terms of politics. Why is it important politically? 50,000 jobs. A new headquarters," wrote Van Dam, "would pack enough of an employment and economic punch that it could have a measurable effect on presidential elections. To estimate that effect, we need to understand who Amazon’s workers will be, and how they’ll vote. OK, they want young, educated workers, with a strong university system in the area and an "ability to recruit talent to the area."

Think about Pennsylvania. Trump’s 44,292-vote margin is smaller than the number of new Amazon employees if the company picks Philly or Pittsburgh. A Miami headquarters could shake up Florida, already a swing state. Ditto for Raleigh, North Carolina.
Which one predominates in practice? We can’t venture a guess, but the answer would significantly affect the political impact of Amazon’s decision. Outside workers are presumably more likely to change a city’s political mix than residents, but the arrival of a major new employer would help a city retain the sorts of workers that, in a previous era, might have moved away.

The group Amazon seems to regard as its hiring pool, college graduates younger than 40, leans heavily Democratic. In the 2016 election, the national network exit poll found 56 percent of them voted for Democrat Hillary Clinton vs. 35 percent for Trump.

But will there be enough of them working at Amazon's new headquarters to swing any states? Let’s try running some numbers.

It’s easy enough to count the workers. Amazon says it will hire as many as 50,000 people at its new hub over the next 10 to 15 years, as well as create “tens of thousands” of additional jobs through direct investment. In Seattle, it pegs that additional-job number at 53,000. We’ll use that figure in our back-of-the-envelope math,to obtain a high-side estimate.

That starts us out at 103,000 theoretical Amazon and Amazon-adjacent workers.

To estimate how many voting family members those workers might bring along, we can use a 2015 Pew Research Center analysis of Census Bureau data that finds a marriage rate of about 65 percent for adults age 25 or older.

That brings us up to 169,950 workers and spouses. Caveat: We have no idea how many Amazonians married each other. The government doesn’t release that info.

Not all of those are eligible voters. Some may be felons, while many more won’t hold citizenship in the United States. For our estimate, then, we’ll count only 92 percent of the total-- roughly the percentage of adult U.S. residents who, according to the Census Bureau, held citizenship in 2015. That drops it to 155,844.

And not all those who are eligible to vote go to the polls. According to the census, voter turnout was 64.1 percent for bachelor’s degree holders ages 25 to 44 in 2016. That drops our number to about 99,896.

Based on our assumptions, the Democrats would capture about 55,942 of those voters and Republicans would get 34,964, making for a total Democratic margin of 20,974.

That’s more than Trump’s 10,704 margin in Michigan and close to his 22,748 margin in Wisconsin, but it’s not big enough to flip any of the states on the Amazon shortlist.

Ours is already a high-end estimate of Amazon’s impact-- it accounts for both Amazon’s hiring and the jobs it claims to directly create, and assumes that all such jobs will be new to the region. A more conservative set of assumptions would result in a margin of less than half that size. But neither model captures everything.

Specifically, the cities clamoring for the online retail giant’s attention are counting on a salubrious knock-on effect. They hope that Amazon’s economic activity and stamp of approval will draw in other tech companies and help their city become the next Seattle or San Jose.

If that happens, all of the political effects here will be multiplied, perhaps to the point where the state hosting the chosen city will tip from one party to the other-- unless Toronto wins, in which case all our assumptions are bunk because it's in Canada.

These cities are begging to have their economies transformed by Amazon, but not all of them, particularly those in red and purple states, may realize that it could transform them politically as well. After all, U.S. tech hubs end up following a similar political pattern.

Even if the city’s presidential pick doesn’t change, their new Amazonian voting bloc is likely to upend local and congressional elections.
And isn't Apple talking about opening some major new campus or campuses-- not exactly a headquarters, but something big? Des Moines, where Apple is almost surely building a $1.375 billion data center in the Des Moines suburb of Waukee, is already imagining...



At 9:11 PM, Anonymous Anonymous said...

If they're smart they'll go to Toronto. Health care is not a cost there.
Assuming their workforce for the new site is largely techie, a lot of them will be from India and those folks would like Toronto much better too.

And America is turning rapidly into a white racist dumber-than-shit greedy corrupt shithole... so they'd be better to avoid jumping into that swirling bowl of shit.

LA - traffic
Denver - smog and traffic
the south - shithole
Michigan - lead in the water

USA - shithole

I won't go on. You get the picture.

At 1:37 AM, Anonymous Anonymous said...

100,000 low-wage, no-benefit jobs. Big Deal, Bezos! Just goes to show what fools too many corrupt politicians are. Such a deal will end up costing the locales which "win" the centers more than they gain. But who cares? The taxpayers are made of money working such jobs, right?

At 6:52 AM, Anonymous Anonymous said...

I presume that "headquarters" does not mean another warehouse distribution center. It implies more the management/executive type jobs plus techies since a lot of its profit comes from selling IT/cloud services and all the support jobs that requires.

Of course some of those HQ jobs will be of the admin, custodial and craft services variety too.

Still, if I were Bezos, it'd be Toronto in an absolute no-brainer. The delay can only be time for negotiating the best tax cut deal they can get. Unless Bezos is a total moron.

At 8:21 AM, Anonymous Anonymous said...

Walmart is shedding thousands of managers. What makes you think Amazon won't?

At 3:19 PM, Anonymous Anonymous said...

Bezos is trying to take over the world's capitalism and tech sectors. He won't shed anyone until he realizes his dream. He's playing the long game.

The waltons are just trying to maximize their short-term profits.

Slightly different philosophies.

At 3:31 PM, Anonymous Anonymous said...

Bezos doesn't need so many managers. His operation is already heavily robotized, in that ordering and processing don't require humans.

I'm leaning toward him moving to Toronto because he could do like Burger King and invert himself away from US taxes. Even the new tax bill isn't low enough for the likes of him.


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