Too Big to Govern: Public Balance Sheet for the World's Largest Store

Abstract

This report examines Amazon.com's standing as a socially accountable corporate citizen, with close attention to the impact of Amazon’s logistics operations on the public balance sheet in the four-county Los Angeles region. The Los Angeles region purchased an estimated $7.2 billion in goods from Amazon in 2018. Amazon has grown explosively as an autonomous, fresh thinking, hard driving organization that has taken maximum advantage of every freedom and opportunity allowed it. But it is no longer just an agile adventurer. Amazon is now a dominant force in shaping communities where its logistics operations are located and its workers live. It is restructuring industries, destroying brick-and-mortar retail jobs and replacing them with warehouse and delivery jobs. Amazon’s intense, demanding corporate culture has benefited those at the top, but not necessarily workers who do the heavy lifting of the logistical network that brings packages to our homes. Proximity to lower-income neighborhoods in the four-county region facilitates Amazon’s access to a job-hungry labor force. At the same time, the wages paid by Amazon perpetuate the economic struggle in these neighborhoods. For every $1 in wages paid by Amazon, warehouse workers receive an estimated $0.24 in public assistance benefits. Amazon benefits from an estimated $790 million annually in uncompensated public costs in the Los Angeles region for adverse impacts on the environment, public health, transportation infrastructure, and labor force.

Keywords: Amazon, Delivery Drivers, E-Commerce, Earnings, Economic Impacts, Emissions, Employment, Greenhouse Gas, Health, Homelessness, Housing, Income, Industry Impacts, Job Quality, Jobs, Logistics, Los Angeles, Public Assistance, Public Costs, Risk, Social

JEL Classification: B41, C13, C40, C50, C54, C58, C67, C81, D42, D73, E24, H71, I31, J31, J38, J47, L12, L81, O33, P12,