Amazon is committed to improving the communities where we invest and operate. A recent study from Oxford Economics, “The Socioeconomic Impacts of Employer Investments on Local Communities,” provides quantitative data demonstrating how Amazon’s investments contribute to local communities across the United States.
After five years, counties with investments from large companies see socioeconomic benefits compared to counties without such employers, the study found. It examined counties nationwide with significant employer investments and featured an Amazon facility in Wilmington, Delaware, as a case study. Oxford Economics’ analysis concluded the following:
- New business formation increased by 3.6%. For the average county, that means nearly 100 additional businesses were formed in the five years after a large company invests in a given area.
- More people are working. Unemployment went down and labor-force participation went up. The average county in the study with large company investments saw a sustained 0.4 percentage point decrease in unemployment and a 2.1 percentage point increase in labor-force participation. Not only were the unemployed getting jobs, but people who had dropped out of the labor force were being drawn back in, potentially by the renewed economic climate.
- Violent crime dropped by nearly 10%. Counties with large business investments saw an 8.1% decrease in violent crime over five years, which Oxford Economics cites may be linked to decreased unemployment.
- Wages increased by an average of almost $630 annually. Employee earnings in counties that saw investments increased by an average of 1.4%, demonstrating a link between corporate investment and improved incomes.
- People moved off public health insurance like Medicaid, and onto their own insurance. Invested-in counties saw an average increase of 1.3 percentage points in private insurance coverage, which equates to nearly 1,200 people per county—suggesting that the boost in jobs and opportunity is making fewer people rely on assistance from Medicaid and other social welfare programs.
The researchers at Oxford Economics pointed to the establishment of an Amazon fulfillment center in Wilmington, Delaware, as an example of the trends found in the research.
“This case study highlighted how the entry of a large employer—in this case through an Amazon fulfillment center—revived a shuttered work location and created quality employment opportunities for local workers,” the report says. Researchers also note Amazon’s focus on upskilling, hiring directly from the local community, and starting salaries and benefits (including base pay of $18 an hour at the time of the study, and benefits like medical leave and 401k matching).
Since the study was completed, Amazon has continued to increase employee pay, announcing this year a $2.2 billion investment to increase the national average base pay to $22 per hour and average total compensation to more than $29 per hour when you include the value of their elected benefits (things like health care from the first day on the job).
“Having an employer like Amazon choose the Wilmington area has created opportunities for residents throughout the county,” said State Senator Spiros Mantzavinos of Delaware, whose district includes part of Wilmington. “Additionally, I appreciate the way Amazon and its team members have volunteered and supported many neighboring community organizations and nonprofits, which play an important role in many people's lives. Amazon cleaned up an old car plant and brought new energy into this community with its facility.”
We work hard to act as a partner to the community and make sure that our growth has a positive impact. Oxford Economics’ data-driven conclusions reveal that investments like the ones we’ve made in Delaware—and other communities across the country—make a meaningful difference to the lives of those who reside there.
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