There’s a lot going on over at Amazon, but things are complicated for the world’s largest Internet company by revenue. Among the company’s biggest problems are taxes and a lack of diversity.
Amazon is currently in a battle over Seattle’s tax proposal meant to address the state of emergency over homelessness all while they are trying to build a second headquarters. Seattle votes today on a tax on big businesses that would address an escalating crisis in homelessness–and Amazon is not happy about it. In fact, Amazon has paused construction on a 405,000-square-foot development just north of downtown. Amazon also said it’s “evaluating options” to sublease its 722,000 square feet office space in the Rainier Tower building, also currently under construction, Seattle Curbed reported.
The city and has warned that “it would forgo additional space it recently leased if the council approves the tax, which is intended to raise $75 million a year,” the Intercept reported.
Amazon is also in the news for getting tax breaks while employees are relying on food stamps, according to a new report.
“Later this year, Amazon will begin accepting grocery orders from customers using the Supplemental Nutrition Assistance Program, the federal anti-poverty program formerly known as food stamps. As the nation’s largest e-commerce grocer, Amazon stands to profit more than any other retailer when the $70 billion program goes online after an initial eight-state pilot,” the Intercept reported.
As competition heated up for cities hoping to land Amazon HQ2, leading Democrats criticized the online retail giant for asking taxpayers to subsidize and offer tax credits to win the second headquarters of one of the world’s most valuable companies.
“The cities should not compete against each other in a race to the bottom. It’s absurd for the taxpayers to offer subsidies to one of the richest companies in the world,” Rep. Ro Khanna, D-CA, said in a statement to The Intercept.
Miami offered Amazon $6.2 million in subsidies — and that was by no means the highest offer from finalists for Amazon’s second headquarters, according to Good Jobs First, a nonprofit that tracks subsidies.
But while Amazon is raking in millions and getting tax breaks in the process, many of its employees are on food stamps.
“In Pennsylvania, for instance, an estimated $24.8 million in subsidies support 13 warehouses employing around 10,000 workers. At the same time, more than 1,000 of those workers don’t make enough money to buy groceries, according to public data provided by the state,” the Intercept reported. “In January, after Policy Matters Ohio reported state data showing 1,430 Amazon workers and their family members enrolled in SNAP.”
The numbers don’t lie. While Amazon was the 28th largest employer in Arizona in 2017, but it ranked fifth for the number of employees enrolled in SNAP. It is the same in Pennsylvania where it’s the 19th largest employer. This is the case in any other states, where Amazon employees are enrolled in SNAP in high numbers.
Bottom line is that although Amazon “employs 200,000 people in the United States, many of its workers are not making enough money to put food on the table.”
Meanwhile, Amazon is receiving millions in tax breaks. For example, in Miami-Dade County where Amazon proposed a fulfillment center, the company secured $1.5 million in tax rebates and a $5 million bond for infrastructure improvement because county officials estimated the warehouse would bring 2,300 jobs at an average salary of $37,000. But in the end, the number of jobs necessary to qualify for the bond had been cut to 1,000, and salary projections dropped to $27,500, or $24,018 for jobs that included benefits.
“When the New York Times investigated corporate incentives in 2012, Amazon had received $348 million from states and localities. By October 2017, when Business Journal released its findings, that number had more than tripled to $1.2 billion,” the Intercept reported.
Another problem area Amazon has is the lack of diversity on its staff. Amazon has been slow to increase diversity in its higher ranks. And recently, tensions were high when an employee email thread about Amazon’s opposition to a shareholder proposal that would require its board to formally consider women and minority candidates when selecting new board members surfaced. As of 2017, out of 18 of Amazon’s top executives, 17 were men and not one was a person of color.
The proposal from CtW Investment Group requested that Amazon to use a “Rooney Rule” requiring that the “initial list of candidates from which new management-supported director nominees are chosen should include (but need not be limited to) qualified women and minority candidates,” Recode reported.
“Shareholders have long believed that embracing diversity will benefit companies by providing greater access to talent, harnessing existing talent more effectively, and improving decision making by reducing groupthink and similar psychological biases,” the CtW proposal read.
Yet Amazon’s board recommended a vote against the proposal, which set off the in-house debate. The email thread was “shared among employees who belong to a variety of affinity groups inside Amazon, including the Black Employee Network and Amazon Women in Engineering.”
Amazon Board votes against a proposal to “implement a ‘RooneyRule’ – that will formally require them to formally just CONSIDER adding minority/women candidates for Board. Board says it isn't a good use of their time. https://t.co/gk9vi4h0qJ pic.twitter.com/FweJv83pF3
— Project Include (@projectinclude) May 9, 2018
