By Laura Stevens and Shayndi Raice
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (December 14, 2018).
Amazon.com Inc.'s announcement that it will bring 25,000 new
jobs to both New York City and Northern Virginia has sparked a
frenzy of local activity. Condos are flying off the market. City
leaders are fighting over tax incentives. Businesses are already
preparing for a rush of new customers.
Lost in all the commotion: It will likely take many years, if
not a decade, before residents see a massive army of Amazon
employees invading their cities.
That is because Amazon plans to slowly hire workers rather than
overwhelm its new hosts all at once. Amazon has told employees at
its Seattle headquarters it won't require them to relocate, said
people familiar with the matter, meaning it will rely on mostly
local hires.
By the end of next year, it projects adding 400 employees in
Arlington, Va.'s Crystal City neighborhood just outside of
Washington, D.C. Amazon expects to only have reached half of its
25,000 target seven years later. In New York's Long Island City
neighborhood, it plans to add 700 employees next year and hit
25,000 by 2028. Those projections assume Amazon will continue its
rapid growth.
Before workers can move in, Amazon needs to remodel temporary
offices it is leasing in Long Island City and Crystal City, which
will take several months. Amazon already has plenty of office space
in both metro areas, so it won't need to rush construction, these
people said. It could take roughly two years before Amazon is able
to break ground on its new New York campus, and potentially a
little sooner for Northern Virginia, due to various needed site
approvals and other preconstruction work.
"It's a multiyear process," said Jeff Forsythe, a site selection
expert with Forsythe & Associates Inc. who isn't involved in
Amazon's projects. Building a major new office space typically
takes one to two years, but Amazon is hiring more people than
usual, he said. "A lot of stuff can happen between now and when
they're supposed to complete this project."
Amazon announced its search for a second, equal headquarters
more than a year ago, saying it planned to hire 50,000 employees
and invest $5 billion over nearly two decades. The company received
applications from 238 locations and then narrowed its list to 20
finalists.
Although Amazon said when it announced HQ2 that no one would be
forced to move, some executives still worried they might be forced
to relocate to a city they didn't want to live in, according to
some of the people familiar with the matter. Amazon said managers
would be able to select where their teams were located, as well as
if they would be split between locations.
Amazon officials decided in September that it would need two
sites to hire enough people to support growth. In November, when
The Wall Street Journal reported the company's decision to split
HQ2 rather than create just one "full equal," many executives were
relieved because they thought it lessened the pressure for Amazon
to move teams across the country, according to some of the
people.
It isn't exactly clear how Amazon will maintain company cohesion
among three megasites. Internally, Amazon maintains that it will
run the two new offices like its Seattle corporate headquarters,
eventually housing top executives and major divisions at each
location, while holding board meetings and all-hands gatherings to
signify the locations' importance, some of the people said. Amazon
Chief Executive Jeff Bezos is also expected to spend significant
time at all three locations. The changes will happen slowly, the
people cautioned.
Some hires who would have previously started in Seattle will now
have the option to start in and lead teams from the new locations,
some of the people said.
The new campuses in Long Island City and what Northern Virginia
is calling "National Landing" are expected to accommodate a variety
of workers, from high-tech jobs such as software engineers and
professional roles like media relations, to administrative
positions. Amazon has promised salaries will average more than
$150,000, yielding rich rewards from the cities and states. Those
incentives are based on Amazon hiring a specific number of people
according to predetermined timelines.
The hiring pace hinges on Amazon's ability to keep up its rapid
growth. For a company that is over two decades old, that growth is
far from certain. Amazon is facing stronger competition globally,
as well as regulatory pushback as politicians in the U.S. and
abroad question its size and influence.
In Seattle, Amazon's employment has grown from 5,000 workers in
2010 to more than 45,000. It also has 18 tech hubs employing a
total of more than 20,000 workers across North America. The San
Francisco Bay Area is its largest hub outside Seattle, with more
than 6,000 workers, and more than half of those are in Sunnyvale,
Calif. Over 4,000 Amazon employees already work in New York.
Amazon employs more than 600,000 workers world-wide, mostly in
its warehouses. It has roughly 22,000 jobs open around the world,
according to its job site. More than 6,000 of those positions are
in software development.
Write to Laura Stevens at laura.stevens@wsj.com and Shayndi
Raice at shayndi.raice@wsj.com
(END) Dow Jones Newswires
December 14, 2018 02:47 ET (07:47 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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