San Bernadino, California – This community was still reeling from the recession in 2012 when it got a piece of what seemed like good news. Amazon, the global internet retailer, was opening a massive 950,000-square-foot distribution center, one of its first in California, and hiring more than 1,000 people here.“This opportunity is a rare and wonderful thing,” San Bernardino Mayor Pat Morris told a local newspaper at the time.
In the months and years that followed, Amazon dramatically expanded its footprint in and around San Bernardino, a city 60 miles east of Los Angeles. The company now employs more than 15,000 full-time workers in eight fulfillment centers (where goods are stored and then packed for shipment) and one sortation center (where packages are organized by delivery area) in the Inland Empire, the desert region bordering Los Angeles that encompasses Riverside and San Bernardino counties. This expansion provided a lifeline to the struggling region, creating jobs and contributing tax revenue to an area sorely in need of both. In San Bernardino, the unemployment rate that was as high as 15 percent in 2012 is now 5 percent.
Yet in many ways, Amazon has not been a “rare and wonderful” opportunity for San Bernardino. Workers say the warehouse jobs are grueling and high-stress, and that few people are able to stay in them long enough to reap the offered benefits, many of which don’t become available until people have been with the company a year or more. Some of the jobs Amazon creates are seasonal or temporary, thrusting workers into a precarious situation in which they don’t know how many hours they’ll work a week or what their schedule will be. Though the company does pay more than the minimum wage, and offers benefits like tuition reimbursement, health care, and stock options, the nature of the work obviates many of those benefits, workers say. “It’s a step back from where we were,” said Pat Morris, the former mayor, about the jobs that Amazon offers. “But it’s a lot better than where we would otherwise be,” he said.
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But as the experience of San Bernardino shows, Amazon can exacerbate the economic problems that city leaders had hoped it would solve. The share of people living in poverty in San Bernardino was at 28.1 percent in 2016, the most recent year for which census data is available, compared to 23.4 in 2011, the year before Amazon arrived. The median household income in 2016, at $38,456, is 4 percent lower than it was in 2011. This poverty near Amazon facilities is not just an inland California phenomenon—according to a report by the left-leaning group Policy Matters Ohio, one in 10 Amazon employees in Ohio are on food stamps.
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The arrival of Amazon has been bittersweet for people like Gabriel Alvarado, 35. He started working at Amazon’s San Bernardino distribution center in 2013, making $12 an hour, hoping that the job would help him support his new wife and two stepdaughters. Amazon proved a stressful place to work, with managers chewing out employees for not moving fast enough, he told me, which was tough to put up with for meager pay. (An Amazon spokeswoman, Nina Lindsey, told me that, like most companies, Amazon has performance expectations, but that it supports people not performing with dedicated coaches to help them improve.)
Meanwhile, Gabriel watched as his 39-year-old brother Jose worked across the street, doing the same type of job at a warehouse for the grocery chain Stater Brothers. The 1,000 workers there are unionized and get full medical benefits, pensions, and retiree medical benefits. Wages start at $26 an hour, but many workers make a lot more than that because Stater Brothers operates an incentive program in which people who grab orders—doing similar tasks to workers at Amazon—are rewarded if they go faster than the average speed. Jose Alvarado is able to support a wife and four children on his Stater Brothers salary. When his son was diagnosed with a rare form of anemia, his insurance covered everything.
Though Gabriel was doing the same type of work at Amazon, he had to shell out more money for health care, and made a lot less money. “I saw my brother doing the same type of work, but moneywise, he had better credit, he could afford more, while I was barely getting by,” Gabriel told me. He has tried to get a job with Stater Brothers to no avail, and says there are few other local options but at Amazon or at companies that work for Amazon. In 2016, he used Amazon’s tuition reimbursement to get his commercial driving license, attending school on the weekends while working during the week. But the best job he could find was working for a third-party contractor, driving a truck for Amazon. “It’s either Amazon or nothing,” he told me.
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Morris, the former mayor of San Bernardino, told me that in 2012, Amazon seemed like a lifesaver. San Bernardino’s unemployment rate was at 15 percent, home values had fallen 57 percent since 2007, and the city, facing a $45 million budget shortfall, would file for bankruptcy in August of that year. “At the point they came in, any job is a good job,” he said. But the jobs the company is offering are indicative of how the economy has changed in San Bernardino in the past few decades. “To a certain extent, based on the history, it’s a step down for families,” he said. The jobs that used to dominate San Bernardino were unionized ones with good benefits, at the Kaiser steel mill, the Santa Fe railroad maintenance yard, and the Norton Air Force Base. Now, jobs like the ones Amazon creates pay less and aren’t unionized, and require multiple members of a household to work, often more than one job.
PG says there’s a template for these types of anti-Amazon stories.
PG apologizes to any who are bored by another one of his rants. He admits he does like Amazon and thinks it’s a great (but not perfect) company. Amazon regularly achieves high rankings in lists of the country’s most-admired companies, so PG isn’t alone in his opinions.
Of course, a great many regular visitors to TPV have substantially increased their incomes and standards of living because Amazon was willing to disrupt the petrified publishing industry. That industry tends to be negatively disposed towards Amazon because change. There are far fewer publications like The Atlantic than there used to be, so perhaps more than a bit of the credulous regurgitation of Big Labor’s talking points may be better understood in that light.