The Fordham Ram

Amazon’s Absence: A Win for New York

Though+Amazon%E2%80%99s+decision+to+move+its+HQ+will+result+in+the+loss+of+25%2C000+jobs%2C+it+is+ultimately+a+win+for+New+York+City.+%28Courtesy+of+Facebook%29
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Amazon’s Absence: A Win for New York

Though Amazon’s decision to move its HQ will result in the loss of 25,000 jobs, it is ultimately a win for New York City. (Courtesy of Facebook)

Though Amazon’s decision to move its HQ will result in the loss of 25,000 jobs, it is ultimately a win for New York City. (Courtesy of Facebook)

Though Amazon’s decision to move its HQ will result in the loss of 25,000 jobs, it is ultimately a win for New York City. (Courtesy of Facebook)

Though Amazon’s decision to move its HQ will result in the loss of 25,000 jobs, it is ultimately a win for New York City. (Courtesy of Facebook)


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By Sean Franklin

This week, Amazon cancelled its plans to build a new corporate campus, dubbed “HQ2,” in New York City. The deal to bring Amazon to New York fell apart after the company was faced with opposition from local residents and lawmakers. Particular aim was taken at the $3 billion in government subsidies that the company would receive, as well as Amazon’s less-than-stellar track record of corporate abuses and mistreatment of workers.

Gov. Andrew Cuomo and New York Mayor Bill de Blasio both bemoaned the collapse of the deal, as did many in the business community. It makes intuitive sense to feel bad about this – New York City had 25,000 new tech jobs on the way, and now it doesn’t. However, these complaints miss the point entirely. This should be seen as an unadulterated victory for New York, not a loss. With Amazon’s decision to leave, we all dodged a huge bullet.

As I have written before for The Fordham Ram, Amazon’s presence in New York would likely have made life worse for ordinary New Yorkers. New York is already one of the richest and most productive cities in the nation. Accordingly, the cost of living is astronomical. Year after year, New York ranks as one of the most expensive U.S. cities to live in, mostly because the cost of housing is so high.

Amazon’s arrival in New York would have made this problem much worse. An influx of 25,000 wealthy new residents without a commensurate increase in housing stock would have driven the rent up even higher.

Amazon would have hired some New York residents, to be sure, but since the unemployment rate in New York is already so low – it currently sits at 4 percent – the net effect would have been 25,000 new people moving to the city, either to work for Amazon or to replace the workers that had left other New York companies to work for Amazon.

Amazon’s arrival in New York would have benefited no one except Amazon itself. Amazon didn’t pick New York as the site of their headquarters out of a sense of good will or because it wanted their workers to have better bagels. It chose to come here because New York has what it wants: a well-educated workforce and status as a global hub for every kind of business. New York does not need Amazon – Amazon needs New York.

This makes it all the more ludicrous that state politicians were willing to give the most valuable company in the world $3 billion in tax breaks. Voters were rightfully outraged that the state government was handing out billions to the world’s richest man when it can’t seem to find the money to fix basic problems, like the subway (the MTA is controlled by state, not city, officials) or New York’s public schools.

Some in the business community are worried that the loss of Amazon will damage New York’s reputation as a tech hub. But these fears are way overblown. New York was a center for tech before Amazon, and it will be in the future as well.

As recently as last December, Google announced that it was expanding its Chelsea campus, bringing more than 7,000 new jobs and $1 billion in investment – all without a dime in taxpayer money.

According to the New York City Economic Development Corporation, New York’s thriving tech scene already employs 320,000 people. Tech companies are drawn to New York for the same reason that Amazon was – its pool of skilled workers and its access to capital. Amazon’s departure will change neither of those things. In fact, Amazon admitted that its presence in New York (it already employ about 5,000 people in the city) will grow despite the cancellation of HQ2.

Even the property market in Long Island City – the neighborhood of Queens where Amazon would have taken up residence – is projected to grow significantly with or without the company. Demand for apartments in the neighborhood, favored for its prime location right across the East River from Manhattan, was high before Amazon’s announcement and will be after its departure. By 2020, 6,400 new units are expected to go up for sale in the neighborhood.

All this underscores the fact that New York was doing just fine without Amazon, and their decision to leave will not hurt us. In fact, we’re probably better off without them.

We’ve saved ourselves billions in taxpayer money, and we’ve avoided overheating the New York’s property market more than it already is. Amazon’s loss is New York City’s gain.

 

Sean Franklin, FCRH ’21, is an urban studies major from Alexandria, Virginia.

 

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Amazon’s Absence: A Win for New York