business news in context, analysis with attitude

There are a couple of stories this morning about Amazon that focus, in different ways, on the impact that Amazon has on communities that it serves - and, some would argue, exploits.  Though, to be clear, it is a picture of mixed blessings and curses.

The New York Times has an extraordinary front page story called "The Amazon Customers Don't See" about the only Amazon distribution facility in New York City. and how it achieved "the impossible during the pandemic":

"With New York’s classic industries suffering mass collapse, the warehouse, called JFK8, absorbed hotel workers, actors, bartenders and dancers, paying nearly $18 an hour. Driven by a new sense of mission to serve customers afraid to shop in person, JFK8 helped Amazon smash shipping records, reach stratospheric sales and book the equivalent of the previous three years’ profits rolled into one.

"That success, speed and agility were possible because Amazon and its founder, Jeff Bezos, had pioneered new ways of mass-managing people through technology, relying on a maze of systems that minimized human contact to grow unconstrained."

However, the Times writes, "In contrast to its precise, sophisticated processing of packages, Amazon’s model for managing people - heavily reliant on metrics, apps and chatbots - was uneven and strained even before the coronavirus arrived, with employees often having to act as their own caseworkers, interviews and records show. Amid the pandemic, Amazon’s system burned through workers, resulted in inadvertent firings and stalled benefits, and impeded communication, casting a shadow over a business success story for the ages."

While Amazon could be herky jerky in its dealings with employees, often lacking consistency and even, sometimes, compassion - some of this is attributed to sheer size and the dizzying acceleration of its offerings - the Times also makes the point that there were many people grateful for the ability to have a steady job at JFK8, and appreciative of benefits that helped them care for their families.

There also seems to be a new appreciation in management that it has to do better, with even Jeff Bezos conceding that in recent public comments.

Meanwhile …

The Philadelphia Inquirer has an interesting piece about the impact that Amazon can have on the areas it serves - and it isn't just one-day delivery.

"As Amazon expands across the Philadelphia region, it is facing something of a neighborhood revolt against its oldest warehouse in the city," the story says.  "The last-mile facility at 4219 Richmond St. has proven to be an unpopular addition to the tight-knit rowhouse section of Bridesburg in the city’s lower Northeast section."

The biggest problems are the traffic the facility generates, and what some locals say is the bad attitude shown by some drivers;  neighbors complain that truckers drive too fast, putting residents - especially children - at risk.

The upside is that the facility employs 150 people, and is open around the clock.

The Inquirer notes that this isn't the only neighborhood, nor the only city or state or even country in which Amazon is having this kind of impact.

"Amazon’s growth has been astronomical during the pandemic, both nationally and in the region," the Inquirer writes.  "The company posted more than 35,000 job openings in the Philadelphia area last year, compared with 5,000 for the second-biggest advertisers, Lowe’s and Penn Med, according to Burning Glass Technologies. By the end of this year, Amazon will have 57 warehouses across the region, with more than half opening in the last year. Worldwide, Amazon added 500,000 workers in 2020, including 400,000 in the United States, and grew its real estate footprint by a startling 50%, largely to meet growing consumer demands for home deliveries.

"While the largest Amazon warehouses exceed one million square feet, the Bridesburg center comes in at 65,490 square feet. But what counts as small in the Amazon universe can make a big impact on a dense urban neighborhood."

KC's View:

Paul Stroup, who the Times describes as having "until recently led corporate teams devoted to understanding warehouse workers," suggests that Amazon's human resources division "had nowhere near the focus, rigor and investment of Amazon’s logistical operations," which certainly is a reflection of the company';s priorities.

And, he argues, it doesn't have to be that way:  "Amazon can solve pretty much any problem it puts its mind behind," he says.

There's a quote in the Inquirer piece from Andre Woodson, an Amazon spokesperson, in which he says, “Amazon strives to be a great neighbor.  We are working with local community leaders and follow all city permits and guidelines to ensure our Amazon site does not disrupt the community.”

I want to believe him, but I'm having trouble.   At the end of the day, faced with a choice between traffic that expedites deliveries and keeping the neighbors happy, I'm pretty sure that Amazon - albeit reluctantly, because who wants to tick off the folks next door - is going to disrupt the community.

The thing is, I'm not sure that customers feel any differently.  Given a choice between dealing with traffic and rude drivers, or giving up overnight or same-day delivery, I'm reasonably confident that most Amazon shoppers would not choose the latter.

I also wonder how many people in the Bridesburg neighborhood are Amazon Prime members.

Just curious.