Amazon has received over $1bn in state and local subsidies to open warehouse/distribution hubs which they euphemistically call "fulfillment centers" across the US. The report questions the efficacy of such tax breaks if they do not contribute to a net growth in jobs.
After analyzing data for counties in 25 states containing Amazon "fulfillment centers", the Economic Policy Institute (EPI) found that within two years the centers lead to a 30% increase in warehouse and storage employment in the surrounding county. But the analysis also found no increase in overall employment in the county and, in some cases, the data suggested a reduction in overall employment.
“If policymakers instead invested in public services – particularly in early-childhood education and infrastructure – that would be a much stronger recipe for long-term economic development, rather than giving tax breaks to national employers like Amazon,” said EPI economist Ben Zipperer.
Zipperer and economic analyst Janelle Jones speculate that the jobs created by the centers are either being offset by job losses in other industries or that the growth is too small to affect the jobs figures. Zipperer said he would expect unemployment to fall - in areas with or without Amazon fulfillment centers - as the recovery in the jobs market continues.
After analyzing data for counties in 25 states containing Amazon "fulfillment centers", the Economic Policy Institute (EPI) found that within two years the centers lead to a 30% increase in warehouse and storage employment in the surrounding county. But the analysis also found no increase in overall employment in the county and, in some cases, the data suggested a reduction in overall employment.
“If policymakers instead invested in public services – particularly in early-childhood education and infrastructure – that would be a much stronger recipe for long-term economic development, rather than giving tax breaks to national employers like Amazon,” said EPI economist Ben Zipperer.
Zipperer and economic analyst Janelle Jones speculate that the jobs created by the centers are either being offset by job losses in other industries or that the growth is too small to affect the jobs figures. Zipperer said he would expect unemployment to fall - in areas with or without Amazon fulfillment centers - as the recovery in the jobs market continues.
He said EPI’s calculations had factored in differences in local and state jobs’ numbers and that EPI would continue to assess Amazon’s employment record as numbers became available.
As cities and counties compete to host new Amazon facilities and its additional headquarters, policymakers should be cautious about “giving away the store”, said Jones. “Instead of pre-committing to giving away public funds to attract employers, communities should demand a concrete demonstration that an employer’s arrival will make their region a more prosperous place for working people.”
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