DANBURY — Amazon has opened its new delivery station on Old Sherman Turnpike this week, promising to fill more than 100 jobs which could be a boon to the local economy.
The arrival of additional work opportunities in a time when unemployment numbers are high — officially 7.8 percent in Connecticut for September — is a plus for the state, said Brian Marks, the University of New Haven’s executive director of its Entrepreneurship and Innovation Program.
U.S. Bureau of Labor Statistics numbers showed Connecticut had a 7.8 percent unemployment rate in September. But the true unemployment rate is estimated to be higher than that, Marks pointed out — the Connecticut Department of Labor’s Office of Research approximated it was actually in “the range of 12 percent-13 percent” during the same span the BLS looked at, which differs due to some misclassification issues.
With the pandemic continuing, Marks said he expected the Danbury Fair Mall and other retail stores would’ve “seen a significant decline in foot traffic,” meaning an increase in unemployment.
“So, it does soften that blow, it doesn’t make it any easier for anyone, but it does provide opportunity,” said Marks, a senior lecturer in UNH’s business school. “In the longer term, this station is yet another signal of how Amazon is transforming the landscape that has been, that is now accelerated by this public health crisis, pandemic, and its economic-induced prices.”
As people become increasingly comfortable with online shopping, Marks said “it strongly suggests that there will be a level of inertia that once things open up, people will still feel comfortable purchasing more and more goods online.”
“Amazon is positioning itself for that very purpose,” he said.
With the new facility creating more than 100 jobs for associates with pay at a minimum of $15 per hour, according to a news release, Marks said “one could argue” the amount of pay could “put pressure on its competitors to do the same.” As of Sept. 1, the state’s minimum wage is $12 per hour.
“It could create, although with our current unemployment situation not likely, but as the public health crisis dissipates, people may be less likely to move from an Amazon job to some other opportunity because of the stability of the employment,” he said. “So, it could create some friction and shortages in other areas, but that’s in the longer term.”
“Hundreds” of driver positions are expected to be created, as well as entrepreneurship opportunities for people “to build their own business delivering Amazon packages,” according to a news release.
“Expanding with the delivery network, the delivery location network, in Connecticut, is a good thing for Amazon and it’s a good thing for its customers,” said Mary Meixell, an associate dean and professor of management for Quinnipiac University’s business school. “They’re promising a higher level of service to the customers with one-day delivery and with additional services like taking a photograph of the packages that’s dropped at your doorstep.”
The company has come under fire for its labor practices. In March, CNBC reported some workers told the network they were “terrified to go to work during the pandemic.” And in April, the Washington Post reported a couple employees — who had condemned Amazon warehouse conditions and criticized other policies — lost their jobs.
Since Amazon is so large, Marks said its business practices would draw more attention — and with more attention, comes more scrutiny.
“One could argue that could, assuming there are other opportunities, create an incentive for Amazon to do the right thing, so to speak,” he said. “There’s increased anti-trust scrutiny on Amazon, there’s increased employment, labor practices on Amazon, and we’ll have to see how all that unfolds.”
At the Greater Danbury Chamber of Commerce’s meeting last week, Mayor Mark Boughton said the city was “excited” about the station’s arrival.
“Anytime that we can build a facility for a blue chip company like that, it’s a success for all of us,” he said.