Amazon opens tech office in downtown Minneapolis

Amazon.com Inc. announced a technology development office in Minneapolis and on Thursday began seeking software engineers for it.

A few employees already have been hired at the office in Fifth Street Towers downtown, a spokeswoman for the Seattle-based internet retailer said. Amazon's website listed 29 immediate openings and the company said it will eventually employ 100 in Minneapolis.

The new Amazon presence demonstrates the company's need to continue expanding its tech-oriented retail and logistics jobs, and the Twin Cities' strength in those specialties.

Many of the first listings focused on transportation technology, though the spokeswoman said that won't be the sole focus in Minneapolis.

Dave Glick, Amazon's vice president of operations technology, said in a statement that the region's commitment to education and "caliber of technical talent in Minneapolis make it an ideal place for our expansion."

Amazon is also building distribution warehouses in Shakopee, where hundreds more people will work.

For the technology development office, the abundance of retail tech talent at firms like Target, Best Buy and SPS Commerce is also likely an appeal to Amazon. Minnesota also is home to one of the nation's largest shipping and logistics companies, C.H. Robinson, and the developers of the Amadeus flight reservation system used by dozens of airlines.

"What they're doing here is part business, part symbolic," said Gene Munster, a Minneapolis-based analyst who follows Amazon for Piper Jaffray. "The business side is pretty straightforward. Target has smart people that Amazon wants … I would love to be an e-commerce developer at Target right now because you just got a pay raise."

He noted that Amazon has also slowly been evolving its business to be more competitive with Target, including launching private-label lines.

For those working tech jobs in Minnesota companies — nearly every business, institution and government agency has IT specialists — Amazon's decision validates their talent.

"We've always known we have really talented folks here, but maybe we haven't always had that many really cool jobs," said Paul DeBettignies, a recruiter who helps start-ups and small tech companies find workers. "Amazon is always doing new stuff."

In recent years, Amazon has put some heavy recruiting muscle into the Twin Cities area, DeBettignies said. But he and others suspect that Amazon may have bumped into its labor paradox: While it can be a challenge to attract out-of-state workers to Minnesota, it's also hard to pull people away from it.

"Amazon probably looked at it and said we're breaking our teeth to hire people in Seattle," said Isaac Cheifetz, a former recruiter who now is a principal with the Minneapolis-based management and technology firm Trexin Consulting.

"Meanwhile, here's a place that has as many good people as we have where we haven't even stuck our toe in."

Amazon now has about 7,800 jobs open in its Seattle headquarters and other facilities there. It is seeking about 1,000 people in San Francisco and a few thousand more in 41 other locations in North America alone. In addition to Seattle and Minneapolis, it runs technology development centers in Austin, Texas; Detroit and San Francisco.

Cheifetz noted that the combination of workers with retail experience plus a strong base of IT talent made setting up a Minneapolis outpost a logical move.

"Pound for pound, this town is as good at business technology as any place," he said. "It's highly unlikely they'll be hiring people in town who'll be writing their core algorithms. They want people who are writing software that makes their company work as a retailer. That's where this town is so strong."

Amazon separately is finishing construction on an order fulfillment center in Shakopee, where it expects to employ 1,000 people. Last year, it opened a smaller sorting center in Shakopee and launched in the Twin Cities its Prime Now service, which promises delivery of a limited number of items within two hours.

Amazon began collecting sales taxes on purchases sent to Minnesota addresses in October 2014, the first signal that it planned to open facilities in the state.

kavita.kumar@startribune.com 612-673-4113

jackie.crosby@startribune.com 612-673-7335