Philadelphia joined scores of cities around the country last week in preparing bids to woo Amazon – the 400-billion-dollar online retail giant that announced it wants to build a second headquarters, where it has promised to invest $5 billion in facilities and employ more than 50,000.
Mayor Jim Kenney and business leaders have all gladly responded to Amazon’s call, promising competitive bids to woo the new headquarters to the city. While some news analysts have written the city off because of its wage tax and other factors, Adam Ozimek, a Moody’s Analytics economist writing in Forbes, said he thought Philadelphia should be leading the pack:
“It’s centrally located between New York and DC, in a state with a growing number of fulfillment centers, and is a low cost, booming, major metro with an airport, good public transportation and leading universities. It’s a city on the upswing with great assets but lots of room to improve, and Amazon can save money by getting in on closer to the ground floor … but not as dangerously close to the ground floor as with some other post-industrial cities that are just beginning to turn around.”
It’s hard to argue that luring Amazon to the city would be anything less than a major win for the city. There are certainly dangers. The city could become overzealous in offering tax incentives to the company at a time when the city needs every penny it can get. The 50,000 tech workers in the city would also put pressure on Philadelphia real estate prices, which remain low by urban standards but could face a lot of upwards pressure if demand increases.
That said, Philadelphia’s need for jobs is high. Reports just this week confirmed the city has the highest urban poverty rate among the country’s 10 largest cities, with one in four city residents living at or below the poverty line. Childhood hunger rates in North Philadelphia have skyrocketed in recent years with food insecurity rates for children rising from 3.1 percent in 2006 to 9.7 percent in 2016.
With all of the economic gains center city has made – with billions in new center city development and skyscrapers rising on every other block – the city’s poor have not seen any benefit.
Dwarfed by the Amazon news was the announcement that Toyota and Mazda were looking to build a new car manufacturing plant in the U.S. Such a plant might be an even better fit for Philadelphia, provided the city and automakers made training available to city residents.
The car manufacturers said they would spend $1.6 billion on a U.S. auto plant and hire 4,000 workers. Eighth District Councilwoman Cindy Bass said last week she’d like to see that investment and those jobs come to Philadelphia
“What I’d like to do is start a conversation about the opportunities a car plant could bring to the City of Philadelphia and the surrounding region,” Bass said. “Philadelphia was once the industrial capital of the nation. As manufacturing grows and evolves, it is vital that we continue to foster that industry and the job creation it can bring.”
It’s a conversation worth having, provided that it does something not only to help add much needed dollars to the city’s tax base but also to offer real opportunities to the city residents who need it most.