Amazon Bets on Office-Based Work With Expansion in Major Cities

The e-commerce giant says it is adding 3,500 employees in six major cities, including 2,000 jobs in New York City Inc. is expanding its physical offices in six U.S. cities and adding thousands of corporate jobs in those areas, an indication the tech giant is making long-term plans around office work even as other companies embrace lasting remote employment.

Amazon is preparing to add 3,500 corporate jobs across hubs in New York, Phoenix, San Diego, Denver, Detroit and Dallas, the company said Tuesday. The plans include 2,000 jobs at the historic building in Manhattan that once housed the Lord & Taylor flagship department store. Amazon purchased the Fifth Avenue building from work-sharing company WeWork, a subsidiary of We Co., for more than $1 billion, people familiar with the matter said.

The Seattle company’s plans contrast with those of some other major technology companies during the coronavirus pandemic, which have embraced remote work for the long-term. That has included Facebook Inc., which in May said it would shift toward a substantially remote workforce over the next decade and Twitter Inc., which told employees they can work from home indefinitely.

Amazon, which was early in sending employees home when the pandemic hit, is allowing staff who can work from home to do so until Jan. 8. The company, however, expects much of its staff to one day return to its offices, Vice President of Workforce Development Ardine Williams said.

“The ability to connect with people, the ability for teams to work together in an ad hoc fashion—you can do it virtually, but it isn’t as spontaneous,” Ms. Williams said in an interview. “We are looking forward to returning to the office.”

Amazon is adding more than 900,000 square feet across the six locations where it is expanding. The New York space alone totals 630,000 square feet.

The jobs at the hubs will include engineering and product-management roles as well as others across various departments, including Amazon Web Services, the Alexa virtual-assistant team, advertising and Amazon Fresh. All the positions being added are new, Ms. Williams said.

The pandemic has reshaped corporate working structures. Major markets like San Francisco and New York have seen many workers leave as companies embrace remote work and survey data has indicated many employees prefer at least some type of remote option. While few companies expect remote work to go away in the near term, some executives say their views have evolved and that they no longer see remote work lasting forever.

Amazon said the expansions aren’t derived from or linked to any financial incentives from local or state governments. The company is receiving some building incentives transferred over from the deal with WeWork for the Lord & Taylor building that will reduce costs to refurbish the space, people familiar with the matter said. That office is scheduled to open in 2023.

Amazon’s plans, especially in New York, show that big tech companies aren’t done settling in major cities with relatively expensive offices.

Facebook recently agreed to lease the entire 730,000-square-foot office space at the historic James A. Farley Building in Midtown Manhattan. Amazon’s expansion in the city comes more than a year after its closely watched plans to establish one part of a second headquarters there crumbled following backlash from some state, city and congressional officials and activists over the plans, which included roughly $3 billion in tax incentives.

Urban locations remain core to Amazon’s company structure and provide needed talent pools that it expects will remain robust, Ms. Williams said. She expects professionals to continue to gravitate to urban working environments.

“We remain committed to being integrated into the communities we are in, and the urban environment offers us that opportunity,” she said.

Ms. Williams also said it remains challenging to forecast the next year and how employees will return to office spaces, but Amazon plans to offer its staff flexibility. Some jobs like customer-support roles have historically been remote, she said.

Amazon, the nation’s second-largest private employer behind Walmart Inc., has spent billions to respond to the pandemic and has largely bounced back from early struggles to meet an immense surge in demand and deal with worker absences that caused delays. As companies across industries have slashed jobs, Amazon has grown in size and power. It employs more than 602,000 people in the U.S., more than 100,000 of them in corporate positions, according to the company. The company’s world-wide employment, including seasonal workers, totals more than 1 million.

The company reported a record $88.9 billion in sales for the quarter ending June 30. It hired roughly 175,000 warehouse workers during the past months, most of whom it said it would keep.

Its expansion in the six cities will mostly happen over the course of the next two years, the company said, with a number of positions starting to get filled now.

As published in The Wall Street Journal | By Sebastian Herrera |  Aug. 18, 2020 

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