If Boston lands Amazon’s HQ2, meet Amazonborough
If Amazon were to pick the Boston area as the home for its second headquarters, what would that look like?
The effect, experts say, would be dramatic.
It could be akin to building a whole new city in Greater Boston — one that is quite large (about as many residents as Cambridge) and well-compensated.
Call it Amazonborough.
“It would be a major transformation,” said Barry Bluestone, a professor of public policy at Northeastern University and senior fellow at the Boston Foundation. “We’re talking about something that’s totally out of scale [from] anything we’ve ever seen.”
The company says it is looking for a metropolitan area in North America to build a second headquarters where it will hire up to 50,000 new full-time employees.
Of course, Amazon wouldn’t plop down that many workers overnight. It has said it plans to start off much smaller and expand over the course of about 10 to 15 years.
And the company describes 50,000 workers as a maximum number; it’s possible fewer would end up being hired. The company puts the total for its existing Seattle headquarters at 40,000-plus.
But if it were to hit the 50,000-worker mark, or something fairly close, that would be more full-time workers than currently employed by any company in Massachusetts and nearly 63 times the number of employees General Electric plans to house — about 800 by 2024 — at its much-discussed new headquarters in Boston.
How would all those jobs get filled? No matter how you slice it, it would require a significant influx of people moving into the area.
That’s because even though a chunk of the Amazon jobs would go to current residents of Greater Boston, given the low unemployment rate here, many of those people would then leave behind a position at some other organization in the area that would then presumably need to be filled by someone else.
How many new neighbors are we talking about?
The average household size in our region is about 2.6 people per dwelling. If just 30,000 to 40,000 Amazon workers moved into Greater Boston as new residents, they, along with their significant others, children, and other roommates, would translate to approximately 75,000 to 100,000 new residents scattered across the Boston metro area.
Population would grow even higher than that as the local economy swells with people providing the goods and services in demand by all those new residents.
Only 13 of the 351 cities and towns in Massachusetts have populations above 75,000, including just five with more than 100,000. Boston has about 650,000 residents, according to 2015 Census counts, while Worcester has 183,000; Springfield has 154,000; and Lowell and Cambridge have about 110,000 people apiece.
Amazon also says it wants to pay workers at its second headquarters more than $100,000 a year, on average. That would be a big boost.
Among Massachusetts communities, the highest median earnings for workers in 2015 were in Weston, $83,971.
There are few communities in the United States where median earnings top $100,000. Several examples are in California’s tech mecca, Silicon Valley.
The addition of so many well-paid people to the Boston area would cause a cascade of side effects. But experts said it would be largely positive for the area, overall.
“There will be lots of people coming here from other parts of the country and other parts of the world,” said Marc Draisen, executive director of the Metropolitan Area Planning Council. “When those people move here, they are salaried and they spend money here. All of those things affect our economy, mostly in a positive way.”
That kind of population growth would bring challenges — Seattle has certainly seen a mix of ups and downs with Amazon’s growth there — but specialists said the issues could be managed with proper planning.
In many ways, if Amazon were to build a headquarters here, it would exacerbate trends that are already underway.
Demand on the housing market, transportation network, and infrastructure are already expected to grow significantly, as the economy and job opportunities grow in years to come.
“We should be able to accommodate this kind of growth,” Bluestone said. “It would be a challenge, but I think there are ways to do it.”
Money to help pay for increased demand for public services would come from increased tax revenue paid by the newcomers and the economic boom they would help create.
“They will demand additional services, but they will also be spending money and paying taxes,” Draisen said.
A new Amazon headquarters would undoubtedly affect the housing market, but that probably wouldn’t have a huge effect on the people the company hires directly. “They’re paid well enough, most of them, that they’d be able to compete in this housing market,” Bluestone said.
But he said he worried that “the people who could be harmed would be the working class who make maybe half that income.” Unless the supply of affordable housing is increased, “They just wouldn’t be able to compete anymore,” Bluestone said.
The new residents would have big consequences for transportation, too.
In a report published last summer, Bluestone and other researchers projected that by 2030 Boston will have 430,000 more residents, 10.5 percent more than in did in 2010, and 117,000 additional commuters, or 5.2 percent more than in 2010.
How exactly Amazon would affect commuter numbers is tough to say. It would depend significantly on the exact location of the headquarters.
“The problem is we can’t expand the highway system very much,” Bluestone said. “We’ll have to rely a lot more on public transit,” which experts say is already struggling.
Ted Landsmark, a Northeastern University professor and director of the Kitty and Michael Dukakis Center for Urban and Regional Policy, said the ultimate effect of Amazon’s second headquarters will be driven by how well the company works with local leaders — and how well municipal and state officials work with one another — to address key issues its presence would raise.
“An opportunity of this type requires collaborative planning,” he said.
Draisen noted that downsides of the alternative, a declining or stagnant population, are worse.
“Staying the way you are in this economy is a good way to shrink and get left behind,” he said.