20 Cities Survive Amazon HQ2 Shortlist
Four months after Amazon announced plans to construct a second headquarters, North American cities have been making grandstanding pleas in order to court the ecommerce behemoth. New York City’s mayoral office lit up the Empire State building with Amazon’s glowing orange hue in a symbolic gesture, while certain cities like Chicago went the more extreme route, proposing laws that could funnel income taxes directly back to the company. After much speculation, here is the official Amazon HQ2 shortlist:
- Atlanta
- Austin
- Boston
- Chicago
- Columbus, Ohio
- Dallas
- Denver
- Indianapolis
- Los Angeles
- Miami
- Montgomery County, Md.
- Nashville
- Newark
- New York
- Northern Virginia
- Philadelphia
- Pittsburgh
- Raleigh, N.C.
- Toronto
- Washington, D.C.
Unsurprisingly, most of the cities that made the cut were among the largest in North America, with only one Canadian city—Toronto—left standing. Over 230 cities from the U.S., Canada, and Mexico made official bids for the company’s second headquarters, with Amazon prioritizing tech-centric metros of populations larger than 500,000. In fact, only four of the 20 metro areas—Miami, Nashville, Newark, and Pittsburgh—have a population of less than half a million, with Newark being the smallest of the entrants. Notably, Newark offered perhaps the largest financial incentive to the company, proposing upwards of $7 billion in tax incentives.
How the Amazon HQ2 shortlist was formed is not totally known, according to the New York Times:
“According to people briefed on the process who would speak only anonymously because the deliberations were private, the process was conducted by a team of about a dozen people within Amazon, including economists, human resources managers and executives who oversee real estate. Jeff Bezos, Amazon’s chief executive who was the mastermind behind turning the search into a public process and coined the term “HQ2,” was also involved, the people said.”
At the time of the initial announcement, Amazon released a stream of positive economic statistics about its impact in Seattle, home to the original headquarters. The company stated (although these statistics are still not yet verified by any source outside of Amazon) that it added $38 billion USD to the value of the city from 2010-16 alone, due to its investments and rapidly expanding workforce. Detractors argue that the financial value added to the city did not positively impact the quality of life, however, with more than 51 percent of Seattle residents making less than $50,000 per year and more than quarter of city residents earn less than $25,000 per year. The influx of high-level employment also contributed to rapidly rising housing costs and poorer traffic.
Experts from CNBC believe that Raleigh might be the front-runner of the remaining entrants, which matches the initial bid criteria the most. Although some speculate that Austin most aligns up with Amazon’s future. The company declined to announce when the final decision will be made.
What Amazon Means For MBA Students
Not so secretly, Amazon has become one of the world’s largest MBA recruiters, hiring students from top schools all over the world. We’ve previously outlined the details of why it has become such an attractive destination for business school students.
The company creates a direct pipeline from its MBA internship program to full-time employment, which should rapidly increase with the creation of HQ2. In a previous interview with the Financial Times, Miriam Park, the Amazon Director of University Programs, highlighted the company’s recruitment strategy:
“The Amazon recruitment process is designed to ensure we hire top candidates with high-growth potential whatever their background may be. As part of this we recruit current MBA students and MBA alumni for permanent and internship opportunities worldwide and see MBAs as an important part of our leadership development. We value people who can balance long-term strategic thinking with tactical execution, and who have the ability to make data-driven decisions.”
Stay tuned for more information about the second headquarters and more potential MBA employment opportunities with MetroMBA.
New Amazon Headquarters Bidding Race Begins, with 50,000 New Jobs on the Line
By October 19, bids for the newest Amazon headquarters (dubbed HQ2) will close. For the eCommerce giant, it’s another benchmark for an already historic year.
Following its outward commitment to more hiring and the landmark purchase of grocery store chain Whole Foods earlier this summer, Amazon just announced it will be establishing a new non-satellite headquarters outside of Seattle for the first time, which is expected to bring 50,000 jobs to a select city that bids for hosting duties. With the announcement, Amazon notes, “We are looking for a location with strong local and regional talent—particularly in software development and related fields—as well as a stable and business-friendly environment to continue hiring and innovating on behalf of our customers.”
In the six-page Request for Proposal form, which can be read here, Amazon notes a preference for North American cities that have the following:
- “Metropolitan areas with more than one million people.”
- “A stable and business-friendly environment.”
- “Urban or suburban locations with the potential to attract and retain strong technical talent.”
- “Communities that think big and creatively when considering locations and real estate options.”
Assuming Amazon does elect to build in a city with those population restrictions, there are only nine possible U.S. locations: New York City, Los Angeles, Chicago, Houston, Philadelphia, Phoenix, San Antonio, and Dallas. Three Canadian cities—Toronto, Montreal, and Vancouver—also hit the qualifying population figure.
In Philadelphia, Mayor Jim Kenney quickly announced the city’s intent to enter the bidding war. Chicago Mayor Rahm Emanuel also seems to be close to the effort. However, there may be reason to believe that Texas will be the eventually landing spot for HQ2, where 53-year old CEO Jeff Bezos spent much of his youth.
In a statement, Bezos said, “We expect HQ2 to be a full equal to our Seattle headquarters. Amazon HQ2 will bring billions of dollars in upfront and ongoing investments, and tens of thousands of high-paying jobs. We’re excited to find a second home.”
Local Economic Growth
Amazon notes that the host city will receive a boon beyond more lucrative job opportunities. In its announcement, the company, which employs nearly 400,000 people worldwide (not including short-term seasonal employees), detailed its financial impact in Seattle, which “resulted in an additional $38 billion to the city’s economy–every dollar invested by Amazon in Seattle generated an additional $1.40 for the city’s economy overall.”
As well, the company created more than 40,000 direct jobs in the Emerald City, and 53,000 additional jobs “as a result of Amazon’s direct investments,” according to the U.S. Bureau of Economic Analysis. In the Request for Proposal form, the company promises it “will hire as many as fifty thousand (50,000) new full-time employees with an average annual total compensation exceeding one hundred thousand dollars ($100,000) over the next ten to fifteen years, following commencement of operations.”
According to Wall Street firm Needham & Co., Amazon is expected to control 50 percent of all U.S. online sales by 2021. The ever-increasing market dominance has earned Amazon a fairly negative reputation, but has done little to deter growth.
Via Fortune
Seattle has also been witness to years of skyrocketing housing costs due to the immense economic growth. The Seattle Times notes “the median price hit $730,000, up nearly 17 percent from a year ago” for houses. Amazon and the rest of the Seattle corporate community may not be the only players responsible for the unusually high prices, but it is an inescapable part of the equation.
In a recent interview, Columbia Business School professor Rita McGrath said that Amazon may be looking for a location with less staggering housing costs.
“It’s hard to attract people if they can’t afford the housing available locally,” she said.
The Amazon MBA Impact
Last year, we highlighted Amazon’s massive effect on the MBA job market. The company creates a direct pipeline from its MBA internship program to full-time employment, which should rapidly increase with the creation of HQ2. In a previous interview with the Financial Times, Miriam Park, the Amazon Director of University Programs, highlighted the company’s recruitment strategy:
“The Amazon recruitment process is designed to ensure we hire top candidates with high-growth potential whatever their background may be. As part of this we recruit current MBA students and MBA alumni for permanent and internship opportunities worldwide and see MBAs as an important part of our leadership development. We value people who can balance long-term strategic thinking with tactical execution, and who have the ability to make data-driven decisions.”
The internship programs open opportunities for MBAs to join the company as senior product managers, operations analysts, and more. Throughout the Request for Proposal form, Amazon frequently reiterates its desire to build in a location that has a strong academic culture, writing, “a highly educated labor pool is critical and a strong university system is required.”
Amazon will formally announce where it will build HQ2 next year.
