OCTOBER 2017 • LONGISLANDPRESS.COM 69
Chasing Amazon
Do we have what Bezos wants?
By WARREN STRUGATCH
In 1994, Jeff Bezos left his Wall
Street job and moved to Seattle,
launching a retail startup that
abandoned brick and mortar in
favor of electronic sales.
Bezos named the disruption
Amazon, after a dictionary search
revealed the Amazon River was
the biggest on the planet. Bezos
envisioned making his new store
the biggest in the world.
Famously, he has succeeded. Amazon
passed Wal-Mart two years
ago as the world’s biggest retailer
by market value. Today it ranks
among the largest companies in the
world. More even than its neighbor
Microsoft, Amazon has established
Seattle as a fulcrum of economic
activity.
Bezos now intends to build a
second headquarters somewhere
in North America. To start the
process, he has solicited proposals
from economic-development teams
across the continent. Among them
is a contingent from Long Island.
Good on us. Amazon will invest
$5 billion in building what it calls
HQ2, staffing up eventually with
some 50,000 workers. Long Island
needs the investment and jobs like
hot dogs need mustard. The local
labor market languishes. Over the
past 12 months ending in August,
private-sector jobs in Nassau-Suffolk
inched forward half a percent,
less than a third the state’s tepid
growth rate. The last couple of
months have produced small losses.
Furthermore, growth in high-paying
jobs is weak. People tell me they
get paid less these days for doing
the same work they did before.
Many moonlight to get by.
What’s Bezos seeking for his new
home? The company emphasizes
incentive packages and a “business
friendly environment and tax
structure.”
Translation: Come to the table
ready to pay us big bucks to locate
where you are and don’t forget the
tax write-offs. While you’re at it, be
close to an international airport,
have a substantial population and
a high-quality fiber optic network.
Then we’ll talk.
Should LI even try to compete?
Here’s how we rank in the competition.
Business-friendly environment.
I wonder, does a single business
owner or CEO consider Long
Island business-friendly? Projects
designed to produce jobs, reduce
car dependence and add workforce
housing languish for decades awaiting
permits and approvals.
Stability. Real estate and search
executives use the term “stable”
to describe balanced government
budgets. Both Nassau and Suffolk
have borrowed from Peter to pay
Paul’s budget items, raising the cost
of fines to pay expenditures. Search
execs hate that.
Tax structure. Long Island, in
particular Nassau County, is one
of the highest-tax regions in the
country. Executives cringe when
asked to relocate to higher-cost
areas, asking employers to pay
the differential or simply refusing
relocation. Search execs hate both
those options.
Infrastructure. Major roads
congeal twice-daily at rush hours,
idling hundreds of thousands.
Mass transit, a vital characteristic
of almost every major corporate
investment, is dead in the water
here. Billions of dollars of investment
would be needed to satisfy an
Amazon.
Power. Long Island companies pay
astronomical electric bills which
LIPA et al would have to deeply
discount to satisfy Bezos.
Work Force. Decades of brain
drain means few recent grads or
career-changers fit a big company’s
new-hire profile. Fast-growth companies
need workers who are intellectually
curious, broadly-educated,
of diverse backgrounds, flexible in
their thinking, and multi-skilled in
their capabilities. To develop these
workers means creating company
specific training modules rolled
out by local community colleges
whose professors understand the
company’s internal processes. None
of this is happening here.
Information infrastructure. This is
a relative strength. Three fiber optic
companies – Cablevision, Verizon
Fios, and Lightower – supply
the region. Andy Weitzberg, a board
member and past president of the
Association of Continuity Professionals
of Long Island, tells me the
infrastructure can support a user of
Amazon’s size pretty easily, provided
the new headquarters is built
west of William Floyd Parkway.
I spoke about Long Island’s chances
with Tom Stringer, a BDO USA
exec helping companies across the
country find locations where they
can prosper and grow.
“I wouldn’t put us on the short
list,” Stringer told me about Long
Island’s chances with Amazon.
“I can’t immediately define Long
Island’s value proposition. The real
winners will use this process to figure
that out. We’re going to learn
some hard truths and hopefully
make the changes we as a region
need to make.”
Stringer’s right. By chasing Bezos
we’ll better understand ourselves
and our economic climate. We’ll
be better positioned to attract that
visionary entrepreneur who right
now might be in college or high
school who might settle in here and
attract other ambitious, hard-driving,
intellectually-curious people –
the kind needed to build a worldclass
company.
It’s a time of disruption. It’s time
Long Island disrupted itself.
Contributing Editor Strugatch is a
journalist and consultant. His website
is InflectionPointAssoc.com.
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