Missouri competes for second Amazon headquarters
COLUMBIA - Tech giant Amazon has been making headlines for its skyrocketing stock prices, branching out new markets like its recently launched grocery delivery service, its enormous impact on the closure of traditional brick and mortar stores and its famous two-day shipments.
But now, the “Amazon effect” could be making its way to Mid-Missouri for other reasons.
The American e-commerce company ranked #12 of the most profitable Fortune 500 corporations is looking for its second headquarters - the current hub of operations is housed in Seattle.
The winner: $5 billion in investment and a promise to create 50,000 jobs with some starting salaries at $100,000 a piece.
Kansas City and St. Louis are in the running to clinch a bid with the company. While Silicon Valley seems like an obvious candidate, an MU economics professor said St. Louis and Kansas City may be overlooked, prime candidates.
“Having an Amazon in either Kansas City or St. Louis would revive the tech sector there. St. Louis and Kansas City are not known for tech industry, we mostly have manufacturing and financial firms. Like Silicon Valley, this would attract other tech firms," MU Professor and Ph.D in Economics George Chikhladze said.
He said Missouri has a lot to offer for this type of development and "it's great for job growth and the local economy."
Chikhladze said Missouri has a strong work force with low cost of development, which make for ideal conditions for Amazon to take root in the Midwest.
Unlike Silicon Valley in California, there isn't much competition among the work force to hire employees in this industry. In Missouri, "Amazon won't have to compete with Google, Microsoft, for that limited job force," he said.
In a news release from the Missouri Department of Economic Development, Gov. Eric Greitens said, “We are on a mission to make Missouri a best-in-class state to do business.”
Both the state of Missouri and MU grads could benefit from a move of this size.
"Short-run benefits would be immediate because Amazon is looking for 50,000 very high-paying jobs," Chikhladze said. "These positions would be hired from the local job pool. This also means for Mizzou graduates, some of our students will find a job at Amazon."
Other cities competing for the headquarters span the entire U.S. - Chicago, San Diego, Portland, Denver, Dallas, Boston, Atlanta and Miami to name a few.
Amazon set some guidelines for the proposed cities: accessibility to mass transit, a diverse population, good schools and easy-to-work-with lawmakers.
Bringing a major corporation like Amazon to a new city comes with big change, as seen in Seattle after the company took root in 1994.
According to a report by The Seattle Times, the city is the biggest company town in America. Amazon holds 19 percent of all office space in Seattle and has created a vast footprint with the city’s booming economy, increased cost of living and attraction of talent in the computer technology sector.
If Amazon were to move to Kansas City or St. Louis, Chikhladze said new jobs would be created beyond the tech industry as well.
"This would also create a lot of support jobs immediately. In the airports, we'll have more flights...a lot of support firms and industries would benefit from that. It will create a lot of demand for the local job force," he said.
Since its origin, the company has earned more than $135 billion in revenue. Amazon stock prices have seen a steady increase over the past decades as well. The current stock quote has remained around $950 per share since May this year.
"It will be great news for either Kansas City or St. Louis if they get it," Chikhladze said. "If Amazon moves in, a lot of other companies will follow."