Minnesota looks smart for its minimalist offer for Amazon's regional headquarters that went this month to controversial, huge-subsidy offers from New York City and suburban Washington DC.
Twin Cities already has Amazon -- and more
The debate is underway over whether the winners paid too much to lure regional headquarters of go-go Amazon. Organic, retain-and-expand work, including investing in workforce development and infrastructure, works best and most economically.
November 20, 2018 at 5:35PM
The Twin Cities already has a growing Amazon presence, including 3,000 jobs between its big warehouse facility in Shakopee and expanding software center in Minneapollis.
Moreover, some neighbors are upset in Brooklyn Park where a yet-announced corporation, believed to be Amazon, plans to build a distribution center that could employ 2,500 on what is mostly pumpkin fields. Development always has detractors.
Amazon, from distribution-to-entertainment-to server farms, has grown astronomically in revenue and market value since the Great Recession of 2008-09. That doesn't guaranty continued success at a company that so far has forgone profitability for growth.
And the local economy has done very well, including record employment and a 20-year-low unemployment rate, thanks mostly to organic-business growth. Here's just a bit of the good news recently:
* The state data keepers recently said the number of Minnesotans without work is the lowest since the Great Recession of 2008-09. Many employers are starved for workers at wages that are increasing. The percentage of people considered to be long-term unemployed, as well as the rates of unemployment among African Americans and Latinos, continued to hover at near-record lows.
* Alorica, the California-based call-center operator, is raising its base wage at its Mendota Heights facility from $12 to $14, as it seeks to nearly double its employment to 650 workers. Most workers also will qualify for a $1.50-an-hour bonus, in addition to health care and other benefits. Kevin Greer, director of the Mendota Heights facility, said Alorica chose the Twin Cities to expand because of the productive workforce.
That's just one example of wages rising thanks to demand to retain-and-attract good employees. Several big banks and retailers, who typically pay the least to entry-level workers, have or are moving their beginning wages to $15 an hour in the Twin Cities.
* Minneapolis-based Graco, the global manufacturer of fluid-handling equipment and which employs 1,600-plus in the Twin Cities area, plans to create 84 jobs and invest $73 million to expand in Rogers, adding 480,000-square-feet to the existing 316,000-square-foot manufacturing facility. At its Minneapolis headquarters and flagship manufacturing plant of nearly 800 employees, Graco is committed to expand. And the hometown company contributed several million dollars to help the park board further develop adjacent riverfront property, for public enjoyment.
The opportunity generally is not in luring out-of-state companies with exorbitant subsidies that can cost $100,000-plus per job. It's working with existing companies such as Graco, Proto Labs, Twin Cities Tactile Medical, H&B Elevators, Donaldson Co, Red Wing Shoe, Aggressive Hydraulics and dozens of others on expansion. This work goes on without much fanfare and has meant thousands of jobs annually. And minimal subsidy.
Aggressive workforce development, from trade schools such as Dunwoody, to community colleges to nonprofit trainers, also has helped. They work with employers and local agencies to develop the next-generation workforce, including the hard-to-employ, such as former prisoners.
The Twin Cities also is a pretty good place to start a business, according to most surveys. And Forester Research this week named the Twin Cities one of the top tech-worker hubs in the country.
The two companies announced the agreement Friday evening. The terms are effective immediately.
