Amazon has launched an initiative to build a second North American headquarters. Laura Stevens, Shayndi Raice, and Cara Lombardo in The Wall Street Journal write that the initiative “…could result in the company investing more than $5 billion and creating up to 50,000 high-paying jobs, many in software development and most of them new.”
Amazon wants to locate its new HQ in a metro area with a population of at least a million people and within 45 minutes of a major airport. The Journal lists 74 cities that meet the criteria, ranging from Mexico City (with a metropolitan area population estimated at 21,497,029) and New York (20,153,634) to Tucson (1,016,206) and Cuernavaca (1,009,450). Canadian cities making the list range from Toronto (6,242,300) to Ottawa (1,351,100). A Boston Globe editorial today cautions that U.S. immigration policy may give Canadian locations an upper hand in the competition to host the new HQ.
Stevens, Raice, and Lombardo quote Mark Sweeney, partner at McCallum Sweeney Consulting, as saying “I would expect the interest to be unmatched and unrestrained by every location, even ones that really don’t have a much of a shot.” His firm advised Boeing on obtaining an $8.7 billion tax-incentive package to manufacture a new jet in Washington State, and Sweeney expects cities and states will offer packages in “that neighborhood.”
The Journal reports that Amazon is facing space and hiring constraints at its current Seattle headquarters, where it competes for talent with Microsoft. That might make Silicon Valley an unlikely location for the new HQ. Stevens, Raice, and Lombardo quote Tom Gimbel, founder and CEO of national staffing and recruiting firm LaSalle Network, as saying “There’s only so much talent.” By entering a new labor market, though, “…people will be clamoring to work for them,” Gimbel adds.
My adopted-hometown paper today makes the case for Boston or Cambridge. “Boston should appeal to Amazon for many of the same reasons that convinced General Electric to move its headquarters from Connecticut to Fort Point Channel,” states an editorial. “The region meets the criteria Amazon set out on Thursday: It’s full of high-quality universities, has an international airport, and boasts a diverse and highly educated population.”
The editorial adds, “The state would likely need to dangle tax incentives to the company, as it did with General Electric. Tax breaks shouldn’t be handed out indiscriminately, but so long as the economic impact from an Amazon headquarters exceeds the public investment, it’s a trade worth making.”
The paper cautions, however, that states cannot “…make it easier for Amazon to hire and keep talented foreign workers, a major priority in the tech industry…. Some tech companies are already opening or considering Canadian satellite offices to shield their employees from American immigration policies. Opening an entire headquarters in Canada is a foreseeable next step.”
