The Battle for Amazon’s Global HQ May Hinge on Higher Ed

BY BRIAN C. MITCHELL

Multiple media reports appeared last week about the efforts by American cities, backed by their state governments, to lure the merchandizing giant Amazon’s second global headquarters to their regions. The company will entertain proposals until October 19.

The Battle for Amazon's New Global Headquarters May Hinge on Higher Ed

Amazon set general parameters and has a history in Seattle that forecasts what mix of opportunities it might seek in this $5 billion expansion that may produce as many as 50,000 new jobs. The stakes are high for the North American cities — including Denver, Minneapolis/St. Paul, Dallas, Toronto, Pittsburgh, Austin, Atlanta, Washington, and Boston — that will likely make serious bids for Amazon.

Boston wins on points for the following reasons:

  • It has a recent record of attracting the global headquarters of General Electric into a strong, entrepreneurial, global-based economy.
  • Boston has a well-connected international airport.
  • Its winter weather is no worse than what hot and oppressive summers offer in Dallas, Atlanta, Austin, and Washington.
  • Its economy is healthy and diversified.
  • Boston operates one of the country’s largest public transit systems, now being upgraded after years of neglect.
  • It can offer or piece together large tracts of land to create a new Amazon campus near its thriving downtown.

Boston also has a strong sense of self that mirrors the social, psychological, and cultural mix that also makes Seattle so attractive to Amazon. In fact, Boston’s potential is enormous. It ranked third in A. T. Kearney’s Global Cities 2016 Outlook study. This study looked at both a city’s current performance — based on business activity, human capital, information exchange, cultural experience, and political engagement — and its projected success, based on how personal well-being, economics, innovation, and governance have changed over time.

Obviously, the City of Boston and the Commonwealth of Massachusetts also have a role to play in the bid for Amazon’s headquarters. It’s complicated politically by the run-up to the 2018 elections and the ability and willingness of some bidders to buy Amazon’s commitment through cash and regulatory and tax incentives.

Massachusetts’ politicians should capitalize on a full range of existing programs and incentives but focus on improvements that would benefit its citizens – especially transit upgrades – to answer local questions about “what’s in it for me” rather than try to outbid others financially.

Amazon’s vision must be tied inexorably to a broader, more encompassing and inclusive vision for New England in the 21st century.

Boston’s Bid for Amazon Must Be Built on its Culture of Innovation

Where Boston truly pulls ahead of potential suitors is on the dynamics of its creative culture. Boston rose into the ranks of global cities because it reinvented itself over the past 40 years, while maintaining a historic commitment to wealth management, defense, insurance, and manufacturing, among other core industries. In the eyes of many, it has become the leading example of an “eds and meds” culture, anchored by global heavyweights like MIT and Harvard.

The foundation upon which Boston’s bid for Amazon must be built is higher education writ large.

New England’s colleges and universities have produced a culture of collaboration, creativity, and innovation that permeates its economy, particularly in biotech and medical research — a culture that matches the creative mix of cities like Austin.

What is different, however, is the depth and diversity of the collaborative culture that took root in New England. There is simply more of the historic ingredients available at a scale, maturity, investment capability, and management expertise than possible among other bidders. Visiting Kendall Square or the Seaport District, you sense it as you feel it.

Higher Ed Leadership Must Step Forward to Make Boston’s Case for Amazon

By challenging local leaders to imagine the possible, my hunch is that Amazon was not looking to extract the most ransom but more likely interested in seeing what creatively might emerge to judge its best fit. And this is where higher education leadership must step forward. Even the strengths associated with MIT and Harvard will not win the bid.

The core argument must be that Boston has produced the best model for nurturing the next creative generation in America. In doing so, Boston must also make the case as the logical choice to set Amazon’s future strategically within a global economy.

It begins with New England’s colleges and universities whose combined size, overall quality, skilled alumni and student bases, regional work ethic, and collaborative integration provide the resources that Amazon needs. Almost 100 institutions are within a two-hour drive of Boston to nurture this creative energy — a fact unmatched elsewhere in North America.

Beyond a skilled labor force that can be rapidly grown, higher education must offer concrete examples of collaboration that point to innovation and re-imagination. Massachusetts has come a long way from a manufacturing economy once based on shoes, textiles, and machine parts production, banking, insurance, defense, and electronics.

Boston became a biotech powerhouse over the past 20 years, for example, because its leadership – especially in higher education — could imagine the possible.

Higher education is the economic engine that built the booming Boston that we know today. In the end, sometimes money and tax breaks aren’t always enough. In its bid for Amazon, Boston must demonstrate why.

This article was first published on the blog of the Edvance Foundation. 

4 thoughts on “The Battle for Amazon’s Global HQ May Hinge on Higher Ed

  1. I agree that a strong higher education system helps the economy, but I’m less sure that attracting Amazon should be a priority for educators, and I certainly don’t think we should “choose sides” among the competing cities. To be clear, this endorsement of Boston’s bid, like all posts to the Academe blog, represents only the opinion of the poster, not of the AAUP, which takes and should take no position at all on this.

    However, it must also be noted that Boston remains one of the most racially segregated cities in the U.S. According to one study its metropolitan area ranked 7th in this dubious category (http://247wallst.com/special-report/2015/08/19/americas-most-segregated-cities/4/). And more than 40 years after its notorious busing battle, Boston’s schools are even more segregated than they were before busing began: 86 percent of its students are nonwhite and, as of the 2014-15 school year, 78 percent are low income (https://www.theatlantic.com/education/archive/2016/11/a-40-year-friendship-forged-by-the-challenges-of-busing/502733/). The Boston area’s vaunted higher ed complex, I suspect, disproportionately serves those who are white and privileged.

    But Amazon might fit right in. According to the company’s own figures, in the U.S. 60 percent of its employees are white. 15 percent are black, 13 percent are Asian, and 9 percent are Hispanic. In terms of U.S. managers, however, 71 percent are white, 18 percent are Asian, 4 percent are Hispanic, and 4 percent are black (https://www.geekwire.com/2014/amazon-releases-diversity-numbers/). Nevertheless, to be fair, with respect to total work force Amazon employs far more people that identify as Black or African American than other tech companies, reflecting perhaps that unlike the others it employs significant numbers in its brick-and-mortar warehouses. At 15 percent, it is well ahead of Facebook’s 1 percent and the 2 percent employed by Google and Twitter (sampled average is 7 percent). With respect to managers, however, Amazon’s leadership is the whitest at 90 percent followed by Apple at 87 percent, far above Twitter’s 68 percent. Amazon (75 percent) and Apple (72 percent) promote the greatest percentage of white males into leadership positions (https://www.theverge.com/2015/8/20/9179853/tech-diversity-scorecard-apple-google-microsoft-facebook-intel-twitter-amazon).

    Maybe Amazon might try to change and locate in a largely minority city that needs both employment and a boost to its public education system (K-16) to which the company just might contribute. Just saying.

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