The impact Amazon’s proposed distribution center in McKinleyville would have is being debated in person and online. I suggest we avail ourselves of whatever knowledge we can find, with a critical eye to its sources.
We learn by listening to each other, sharing resources, reading studies and also paying attention to what other communities’ experiences tell us about an Amazon warehouse’s/delivery facility’s impact. The debate is an opportunity to learn, communicate and connect about the community we want to support here.
Studies I have read suggest Amazon may hurt, not help, our local economy and our county’s ongoing employment and housing crises. (Links to the studies referenced here are accessible at northcoastjournal.com).
A 2023 American Economic Liberties Project study found that in communities with Amazon warehouses, retail workers’ pay dropped by 2.4 percent after Amazon’s arrival. Retail workers’ pay fell as far as 100 miles away. Local retail sectors lost jobs, which were not offset by jobs added within the Amazon warehouse.
A study from the University of Illinois Chicago Center for Urban Economic Development found that 53 percent of Amazon workers experienced one or more forms of food insecurity, while 48 percent reported one or more forms of housing insecurity. According to a National Bureau of Economic Research study, a 2.9 percent decline in employment growth of the retail sector was also found in counties with Amazon fulfillment centers.
Civic Economics found that for every $100 spent at a local independent business, $68 recirculate locally, whereas only $42 of $100 spent at a chain store stay local. More recent studies suggest wider margins, with the Institute for Local Self-Reliance showing that for every $100 spent at a corporate chain business, only $13 recirculate in the local economy, while for every $100 spent at locally owned business, $52 recirculate locally.
The Institute for Local Self-Reliance reports, “three-quarters of independent retailers ranked Amazon’s dominance as a major threat to their survival, and only 11 percent of those selling on its site described their experience as successful.”
According to Amazon’s Stephen Maduli-Williams’ comments during the Azalea Hall public meeting on April 29, Amazon is not offering 227 Amazon employee jobs. Amazon employees would total “around 80” warehouse jobs. The other 165 would be independent contractors (delivery drivers), none of whom would be covered by Amazon health insurance, provided workers’ compensation, unemployment insurance or overtime pay as full employees would be.
Of the proposed independent contractors, 112 would be “Flex” drivers who drive their personal vehicles, pay for their own gas and vehicle wear and tear out of their on national average $19/hour wages. They can have an out-of-state license and out-of-state vehicle registrations — anyone with the Flex app can follow YouTube instructions to easily switch what state they can work in. The other 43 proposed independently contracted drivers are Amazon “Delivery Service Providers” (DSPs).
“Amazon Drives Low Wages: The Unraveling of Workplace Protections for Delivery Drivers,” a 2025 study published by the Harvard Kennedy School Malcolm Wiener Center for Social Policy reveals problems with Amazon’s delivery model. (please watch the YouTube video linked on the NCJ website) DSPs drivers make $19/hour, while UPS averages $35/hour. The average Amazon DSP and Flex driver lasts about 1 year on the job, compared to 10 years for FedEx and UPS. The key reason Amazon drivers quit is that their wages do not increase with tenure, and they do not have upward mobility. Flex drivers are denied the right to unionize, while DPS drivers who have managed to unionize have had their companies’ contracts terminated.
The National Employment Law Project has also published a study on Flex drivers, “Delivering Precarity: How Amazon Flex Harms Workers and What to Do About It.” This study’s findings agree with Harvard Kennedy School’s, and states, “Through Flex and its public policy work, Amazon is eroding labor standards in the broader last-mile delivery sector and beyond.”
A better question than “Will Amazon help our economy?” is “What kind of business environment do we want to see here?” If all we focus on is the promise of temporary increases in the number of jobs and total wages (not a conclusion supported by independent studies) and the temporary but slight decreases in poverty (also not supported by the studies I’ve cited) then we miss a lot.
The longer-range outcomes we need to consider are who gets hired to do what and how does this effect the existing business environment, infrastructure and local culture at large. Amazon’s expansion in the delivery and warehouse sector won’t necessarily create new wealth or jobs for Humboldt County. A more likely scenario is that with decreased delivery time, Amazon expansion will cause a larger share of Humboldt retail purchases to be done online, sending profits to distant banks overnight and removing wealth from the community. Delivery jobs that are already being done by employees receiving a living wage will be threatened. Warehouse jobs would replace local retail jobs as local retailers’ sales drop.
It is true we have an unemployment problem, but would this make it better? We have a special local business culture. If we allow Amazon to open a warehouse, what kind of cultural change might that herald? Amazon could do great damage to our local economy and once that economy is gone, it might be too late to return to the way things were.
Amazon is being sued for price gouging by exorbitantly and illegally raising the price of essential goods (toilet paper and masks) during the COVID-19 pandemic, and being sued for price-fixing, illegally using their influence to force other retailers to raise their prices.
Led by the corporate power and greed of a billionaire owner, Amazon Inc. continues to break laws and violate basic moral decency. I do not trust them. I encourage anyone on the fence about this to read these studies. For anyone who disagrees, I hope to listen to you, learn, communicate and connect.
James Zeller (he/him) is a local musician, educator and activist.
This article appears in Humbuggery in Humboldt, Part 1.
Amazon cares as much for Humboldt as Maxxam, and Charles Hurwitz did in 1986 when they used a hostile takeover of Pacific Lumber to make money. In 2008 Maxxam left Humboldt. Amazon is not good for Humboldt, Americans or Humans. Don’t buy from Amazon(it’s possible, you know). Thank you James Zeller for your research.
Excellent article! Just a bunch of short term door dash type jobs. While slowly eroding at the local economy. There’s a reason Walmart was fought for so long. There’s a reason Home Depot (who’s service kinda sucks anyway) isn’t here. We’ll maybe that’s because Piersons has deep pockets locally, nor Lowes are here. Beyond that there’s just not the population to support all the big city stores. Which kinda sick anyway.
It should be fairly obvious that as a corporation becomes more efficient that efficiency comes out of the workers pocket and the community’s pocket
That’s how they get to be billionaires, thousands of communities bamboozled by the corporations, replacing local businesses, local employment, and local entrepreneurs
What’s more efficient for them is less efficient for you
And part of their efficiency comes from not affording employees health benefits or the freedom to unionize. Amazon is relying on the need and hunger for a job, any job, even if it means a job that is one step above indentured servitude.
Thank you for this article, which clearly states quite a few of the economic problems caused by Amazon the Megamegabusiness.
It is worthwhile to read, especially for those who have been misled by Amazon’s fake- employee benefit ads and those desperate enough to give away the good of what we have here in Humboldt, such as local retailers selling homegrown and homemade products, or local residents trying to make do with their mom and pop businesses.