Amazon's contest for two cities to house dual new headquarters has likely winners in Queens, NY and Crystal City, VA.
Amazon is looking to hire a total of 50,000 employees divided between two new headquarters. Leaked reports spotlight the Crystal City area of Arlington, VA and Long Island City in Queens, NY as the next locations for the Seattle-based retail giant.
While both are expensive real estate markets, New York Governor Andrew Cuomo is reportedly prepared to offer hundreds of millions of dollars in subsidies, according to The New York Times.
"Amazon Cuomo"Times Union
"I am doing everything I can," Governor Cuomo commented on Monday. "We have a great incentive package." He added, "I'll change my name to Amazon Cuomo if that's what it takes. Because it would be a great economic boost." Assuming Cuomo hopes to retain the respect of his supporters during his third term as governor, he won't be changing his name.
Governor Cuomo's enthusiasm, however, does set him apart from Virginia officials, who are staying mum on the prospect of Amazon's HQ2. In Crystal City, developer and land owner JBG Smith declined to comment. If chosen, the new Amazon headquarters would be in close proximity to Washington, DC's labor force.
Amazon is refraining from confirming or denying its final decision. Since announcing its plans to expand in September 2017, the company has been shortlisting locations based on availability of trained workers, access to public transportation, and quality of city infrastructure. Amazon is expected to invest $5 billion into its expansion.
Wherever Amazon chooses to expand, its previous impact on its home base of Seattle suggests that it will create an economic boom, but also an increase in housing and traffic congestion. In fact, in Seattle, Amazon has been "singularly blamed for a rapid influx of wealthy techies who...worsen traffic and increase housing problems." To that point, some residents in Queens are wary of the worsening effect 25,000 more employees could have on the already sub-par MTA subway service.
Steve Kovach at CNBC notes, "The 7 train, the subway line that runs through much of Queens, is already straining to service the influx of new residents in the Long Island City area. That would only get worse with 25,000 Amazon workers commuting into Long Island City every day."
If Amazon hopes to fulfill its goal of preparing 500,000 square feet of office space for thousands of new employees to begin work next year, secrecy and rumor need to give way to signed deals and a wave of hiring.
Automation is set to replace a large portion of the American workforce. What do we do once it happens?
In his 1984 essay Is it O.K. to be a Luddite?, Thomas Pynchon predicted that "the next great challenge to watch out for will come when the curves of research and development in artificial intelligence, molecular biology and robotics all converge." Nearly 35 years later, that convergence is upon us. Barring some sort of federally enforced halt on technological progress, automation of most basic services is inevitable.
Self-driving cars are continuing to improve. Automated checkout lines are being implemented all over the American retail space. There are even programs being written that may be doing the majority of our accounting work in the future. Sadly, the common claim that technological advances and economic growth go hand in hand with job creation is spurious at best. In 1964, AT&T was worth $267 billion (adjusted for inflation) and employed upwards of 700,000 people. Today, Google, which is worth roughly twice as much as 1960s AT&T, only employs about 88,000. According to the McKinsey Global Institute up to 375 million people could be out of work by 2030. Unlike the second industrial revolution, which gave us cars and airplanes in the 20th century, the third industrial revolution probably won't create many new jobs. In fact, by that same 2030 mark, the U.S. could be staring down the barrel of 35% unemployment.
The specific numbers, which I've thoroughly explored here, aren't nearly as important as how the U.S. government chooses to address the issue. Mass unemployment is coming, and it's hard to even imagine what it might look like, let alone how we're going to deal with it. In his piece A World Without Work, Derek Thompson attempts to tackle this issue, comparing the future United States to the present Youngstown, Ohio, a once prosperous steel town that lost 50,000 jobs to overseas manufacturing in the late seventies. In the years following the steel industry's evaporation, the rates of depression, suicide, and spousal abuse all jumped up radically. According to professor Jonathan Russo, "Youngstown's story is America's story, because it shows that when jobs go away, the cultural cohesion of a place is destroy." Thompson's thesis is that work is so ingrained in the American psyche that regardless of whether or not we end up with a welfare state to take care of the millions of jobless, there will be civil unrest. Kurt Vonnegut came to a similar conclusion 63 years earlier in his book Player Piano, in which the government was forced to not only provide complete welfare for the unemployed masses, but fake jobs as well.
With regard to the impending employment drought, the government is left with a few options. They can ignore the issue, allowing millions to slip into grinding poverty, turning Youngstown, Ohio into the norm. This type of laissez-faire capitalism would have made Ronald Reagan blush but the problem is, with no money, there are no consumers. Another solution that's been popularized in recent years is Universal Basic Income, a program in which the government pays all of its citizens enough money to live, regardless of whether or not they're employed. Plenty of tech moguls, from Elon Musk to Mark Zuckerberg, have embraced the idea that the money made from technological advances should be, at least partially, given back to the people. On paper, it's a no-brainer. People need money to live, and companies need people to have money or else no one would buy anything. This would, as it were, keep the trains running on time. The problem is, this plan ignores Thompson's point about the vacancy of purpose left by a post-labor economy. There's a feeling of despair attached to having nothing to do. Anyone who's ever spent a teenage summer vacation not working can attest to this, and as evidenced by Youngtown, this listlessness can be destructive, both physically and psychologically.
There is a third option however, one that's helped Germany lower its unemployment rate, called work-sharing. Essentially, the program cuts hours rather than employees. For example, if a company needs to cut 30% of its low level accounting staff, instead of firing 30% of its workers, it cuts everyone's hours by 30%. Conventional wisdom says that inoculating less efficient workers from layoffs while cutting the best workers' hours is a recipe for disaster, but we are entering a distinctly unconventional time. If employees are losing their jobs to hyper-efficient automation, the potential dip in productivity should be more than mitigated. That said, work-sharing doesn't completely fix the problem either. Unless major corporations suddenly start valuing benevolence over higher profit margins, less hours means less pay. Trim the hours enough and the results of work-sharing and the results of ignoring the problem altogether start looking eerily similar.
Matt Clibanoff is a writer and editor based in New York City who covers music, politics, sports and pop culture. His editorial work can be found in Inked Magazine, Pop Dust, The Liberty Project, and All Things Go. His fiction has been published in Forth Magazine. -- Find Matt at his website and on Twitter: @mattclibanoff
There's no justifiable reason for why companies shouldn't have to pay their interns.
Pursuant to the United States' Fair Labor Standards Act (FLSA), an internship can be unpaid if it meets very specific requirements, the most important one being that "the intern's work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern." If the wording there seems a bit murky, that's perhaps intentional, considering the amount of companies who benefit from unpaid student labor each semester. The law was actually rewritten earlier this year following a string of class action lawsuits that were leveled against Fox for not paying its interns. The new law considers the seven parameters outlined in the FLSA, described as a "primary beneficiary test," as flexible, with no single factor being determinative. Unlike in years past, no threshold related to these rules has to be met. The law is now far more subjective and overwhelmingly benefits companies who wish to hire interns without paying them.
Before this, it was illegal for an employer to force an unpaid intern to go on a coffee run for the office, as this is neither educational, nor beneficial to the intern. An intern's work also couldn't benefit the company monetarily. So, if for example, Martha in accounting got behind on her work, contrary to popular belief, she wasn't allowed to ask an unpaid intern to fill out some spreadsheets for her, as this constitutes work that directly benefits the company. The law is now written in vague terms such as "complements" and "displaces" and tends to obfuscate this point. With these changes to FLSA, the Department of Labor has taken clear stance and has sided with the employers, not the interns (workers).
In a January interview with Bloomberg, Paul DeCamp, an attorney who works with employers regarding interns and labor disputes, said this about the original law: "If the intern did any productive work for the company it would -- at least based on the strict reading of the test -- be required that activity be paid, which is not to put too fine a point on it, ridiculous."
DeCamp didn't specify why the premise of paying someone for "productive work" is "ridiculous," but it's safe to assume his point of view is shared with the people writing him checks. Don't worry though, he also assured his interviewer that "if the intern is primarily doing grunt work, not learning skills, not learning about the industry, but is simply replacing work that would've been done by paid employees and therefore amounting to nothing other than free labor and with no discernible benefit to the intern, I think courts would still be willing to say that is employment." Here's the thing though, companies can always find a "discernible" benefit. In one lawsuit filed by interns at Hearst, judges ruled in favor of Hearst, despite the interns complaints about doing menial work while receiving no training. The reason for the ruling? The interns wanted careers in fashion and entertainment, and menial work constitutes "real-life experience" in their fields.
These are just the companies getting taken to court. The rampant abuse of the internship system is nothing short of systemic. In an article in Forbes, Susan Adams discusses an ad she found for the shoe company Salvatore Ferragamo. The ad was for an unpaid "retail internship" that included walking the floor and assisting customers inside of a Salvatore Ferragamo store in New York City. It's important to note that this article was from 2014, well before the labor department decided to make its rules a bit more lax. This is the kind of abuse that was possible.
The fact of the matter is, the latest adjustments to the FLSA, makes the already largely unenforceable laws surrounding unpaid internships, completely moot. There's no federal regulation in place to stop companies from abusing their interns and using them for free labor. The only recourse before was for an intern to sue his/her respective company, and now that that's off the table, those who would work unpaid internships have no real ability to fight for their rights as workers. This isn't just a labor rights issue, however.
When it comes to unpaid internships, the list of negatives is a mile long. These programs overwhelmingly benefit people who can afford to work for free. The rest of us are not so lucky, and the result is a class of applicants that is made entirely of young, upper-class college students or graduates that is neither representative of the American labor force nor fair to the many qualified people who can't get into the industry of their choosing. This is not a simple matter of millennials complaining about their job prospects. Unpaid internships create a huge barrier to entry that fosters and feeds wealth inequality around the country. Without these internships, it's harder to get entry level jobs, and by extension harder to advance in your career. Regardless of the "educational benefits," some aspect of interns' work will always help the company, and that work needs to be classified as labor. If a business isn't prepared to hire their intern at the end of the program, then why take the time to train the intern? The intern's work will always benefit their employer in some way.
Unfortunately, companies are always going to bend the rules and try to convince unassuming kids to work for less than they're worth, but if we have a system in place that helps protect that kind of skulduggery, rather than the workers themselves, are we not equally culpable for the societal damage it causes? Plenty of HR departments have determined that paying interns the minimum wage isn't worth the overhead, and it's important to understand they aren't particularly concerned with the difference between learning and labor. A company not paying someone for their work is a cost saving measure. Nothing more. There should be no such thing as unpaid labor in this country. Pay your interns.