Amazon’s HQ and Toronto: a good, if unlikely, fit

Michael Barnard
Mar 16, 2018 · 4 min read

Toronto has made the shortlist of 20 cities which Amazon is considering for its second headquarters in North America, and the only Canadian entrant. This is fitting given its’ status as the 4th largest North American city and the largest Canadian city. So is it just the token Canadian, or is it actually in the running?

To answer this question, I’ll refer back to the list of attributes I thought would be important to Amazon earlier when assessing Calgary and add a couple.

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  • Eastern time zone. About 46% of the US population lives in it. While numbers aren’t as easily found for businesses, likely a greater percentage of corporate HQs are based in that timezone. Toronto is in the Eastern time zone. Point.
  • Amenities for millennials and the creative class. Toronto is a global exemplar of this, with in fact the primary academic rockstar on the subject, Richard Florida, having made Toronto and University of Toronto his base. It has a great coffee scene, share bikes, share cars, Uber, museums, art galleries, live music venues and okay transit. It’s a massively cosmopolitan city with tremendous diversity. Point.
  • Right employee demographic. Toronto is Canada’s tech and business center with a ton of software, distribution and retail talent. It has about 6 million people in the metropolitan area. It has both enough people and the right kind of people to fill its cube farms. Point.
  • World class international hub airport. Toronto’s Pearson International isn’t as big or connected as New York’s or LA’s, but it’s a lot bigger than Seattle’s. It’s a big step up and there are multiple direct flights back to the mothership daily. It’s Canada’s international hub and Canada travels. Point.
  • Financial center. Toronto is Canada’s financial center. All the banks have HQs there and all of the stock exchange activity is there. Canada’s banking system weathered the 2008 storm just fine because they are intelligently regulated. Point.
  • Great educational institutes to hire from. UofT, Rotmans, York, Ryerson and Waterloo. Queens and McGill down the road. Zero worries about getting fresh local hires. Point.
  • Tech center. Yup. Toronto is Canada’s tech centre, especially for the boring business side of tech which is exactly what Amazon wants. #2 is likely Kanata, which just isn’t that far away. Easy to poach employees from there too. With Waterloo as a world class comp sci faculty a few miles away and UofT being no slouch in that department either, it’s pretty easy to get what you want. Point.
  • Stable economy. Amazon will either want a rich and stable economy or a depressed economy where they can call all the shots. Canada’s economy is stable, and Toronto is the economic heart of Canada, regardless of what the folks in Calgary think. Point.
  • Nice climate. Toronto has the second nicest winters of any large city in Canada, after Vancouver. It’s rarely freezing. Toronto is south of most of eight US states and it’s not in a snow belt. The summers are pretty good too, with long hot spells and only occasional as opposed to constant oppressive humidity. Point.

Now the other bits:

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  • Corporate taxes. Ontario’s and Canada’s taxes were a lot better than the USA’s, but with the recent tax cuts they are merely very competitive. This has changed substantially since they started, and Toronto’s differentiation declined substantially.
  • Trumpist protectionism. Trump and his gang are trying to blow up NAFTA and really hate anyone that doesn’t wear a red baseball cap with MAGA on it. Leaving the USA with their second HQ would be politically challenging. It would also be strategically diversifying. Getting half of their eggs out of the US handbasket would be a shrewd move. Unclear how this would be seen in Seattle’s 33 Amazon buildings.
  • International hires. Well, Toronto can do that like almost no country on earth. Canada’s immigration scoring system would love Amazon’s hires and right now a lot of foreign talent is looking at the USA and saying “Maybe in 2020, if reality returns.” Toronto’s educational institutes are already one of the most wildly diverse in the world, so hiring foreign talent can be as simple as holding a job fair at UofT.
  • Clean air. Ontario’s government committed in 2003 to shutting down coal generation and managed it a year earlier than original plan. As a result, it’s now a rare year that has a single bad-air day.

But really, there are 19 US cities on the list with Toronto, and some of them share these attributes as well as $7 billion bribes to locate in them. Toronto’s odds are likely closer to 1% than 5%. As Toronto’s Mayor John Tory has said, now it’s in the playoffs. But these playoffs are like hockey playoffs with a very large number of teams in contention and only one final winner.

The Future is Electric is the house journal of TFIE…

Michael Barnard

Written by

Chief Strategist, TFIE Strategy Inc. Business and technical future-proofing. Top Writer Quora since 2013. CleanTechnica, Forbes, Quartz+ more. In 4 books.

The Future is Electric

The Future is Electric is the house journal of TFIE Strategy Inc, a firm which assists global clients to future proof themselves in our rapidly changing world of business and technical innovation, and geopolitical and climate disruption.

Michael Barnard

Written by

Chief Strategist, TFIE Strategy Inc. Business and technical future-proofing. Top Writer Quora since 2013. CleanTechnica, Forbes, Quartz+ more. In 4 books.

The Future is Electric

The Future is Electric is the house journal of TFIE Strategy Inc, a firm which assists global clients to future proof themselves in our rapidly changing world of business and technical innovation, and geopolitical and climate disruption.

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