Can Remote Work Programs Save the Economy?
A possible antidote to the “Amazon Effect” on U.S. job creation
Each year, city and state governments across the U.S. spend nearly $100 billion on corporate incentives and subsidy packages under the guise of creating or saving U.S. jobs. The problem is, each of these “megadeals” can cost taxpayers an average of $450,000-$1,000,000 per job. Unsurprisingly, paying one company billions of dollars to attract or salvage jobs rarely pays off.
In 2018, upwards of 238 cities competed to become the site of Amazon’s new headquarters — even though the “Amazon Effect” may end up hurting a local economy more than it helps. For example, although Amazon’s HQ2 expansion is forecast to create 50,000 jobs on paper, many of those will come from outside the local region, while others will be temporary positions.
One study calculated that, by 2016, Amazon had eliminated 150,000 more jobs than it created while raking in $760 billion in subsidies and wiping out over 135 million square feet of competitors’ retail space. Amazon’s presence in Seattle has reportedly increased housing prices, traffic congestion, and economic inequality. One year after Arlington, Virginia won the Amazon bid, housing prices there are also on the rise.
