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Amazon HQ2: The Case for Kansas City

September 21, 2017

Amazon set the economic development community abuzz recently by announcing its search for a new, second headquarters. This massive development would bring 50,000 good paying jobs ($100,000 annual wages on average) and $5 billion worth of development to the metro that Amazon chooses.

These are game changing numbers. For a little perspective, there are about 74,000 jobs in downtown Kansas City, Missouri (inside the loop and down to the crossroads). There are comparable numbers of jobs along the College Boulevard corridor.  Amazon HQ2 would, by itself, be the third-largest employment center in the metro.

Does Kansas City have a chance? PC magazine sure liked us. The New York Times did not.

We don’t know all the details of exactly what Amazon is looking for. In part, Amazon is looking for a city that can:

  • Supply a lot of talented workers.
  • Make it easy for those workers to get around (daily commutes and air travel).
  • Provide a business-friendly environment.

The Kansas City region is competing against many metros, and some would appear to be ahead of us on these particular issues. But there is one key metric where we more than hold our own.

Kansas City IS a tech hub.

Kansas City has a strong location quotient (LQ) of 1.43 in computer and math occupations. This means the share of our workforce employed in computer and math occupations is 43 percent larger than the US share. Out of the 53 metro areas with at least 1 million people, our computer and math LQ ranks 13th.

Amazon HQ2 Chart.png
SOURCE: Bureau of Labor Statistics

Even with this strong base, Kansas City will need to demonstrate a robust talent pipeline to supply enough workers to meet Amazon’s expectations. Yes, computer and math occupations are a relative strength for us, but we currently have just 44,000 workers with these jobs, and most of these workers are already gainfully employed. Amazon will need 50,000 more.

No metro has a bullpen of 50,000 tech workers just waiting for a call, so finding 50,000 talented new employees will be a challenge for all metros pursuing Amazon. This is an opportunity for Kansas City to propose some innovative ideas about how we will build a talent pipeline.

Amazon will look at other, more subjective, criteria as well. Issues like transit, air service and overall quality of life will all weigh heavily. On these topics, Kansas City can tout recent progress and current and future plans.

Landing such a big economic development prize might be a bit of a reach, but going through the process is still worthwhile. The new economy is tech based. Winning economies are going to be those that can grow and attract tech talent. The process we would go through to land 50,000 hi-tech Amazon employees would also increase our capacity to grow our tech workforce and enhance the success of our existing tech firms. Kansas City’s tech sector will benefit from this effort and the number of tech employees will grow, even if they don’t necessarily work for Amazon.

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