As we wrote on Saturday, as part of a series of appearances around the country focusing on the economy and aiding the middle class, President Obama will give a speech tomorrow at the Amazon warehouse in Chattanooga, Tenn. According to NewsChannel9 in Chattanooga, the White House stated that the speech will focus on "manufacturing and high wage jobs for durable economic growth. The president will discuss proposals he has laid out to jump-start private sector job growth and make America more competitive, and will also talk about new ideas to create American jobs." It's the president's first visit to Chattanooga.
The Chattanooga Times Free Press quoted Amy Brundage, deputy press secretary at the White House, as saying, "The Amazon facility in Chattanooga is a perfect example of the company that is investing in American workers and creating good, high-wage jobs. What the president wants to do is to highlight Amazon and the Chattanooga facility as an example of a company that is spurring job growth and keeping our country competitive."
The Times Free Press said that the warehouse has about 1,800 full-time jobs that pay "between $11 and $13 an hour, or about $23,000-$27,000 a year. The median household income is about $37,000 a year in Chattanooga; about $44,000 a year in Tennessee, according to U.S. census data." As another point of comparison, the federal poverty line for a family of four in the U.S., excluding Alaska and Hawaii, is $23,550; for a single person, it's $11,490.
For its part, perhaps in anticipation of the Obama speech, Amazon issued a release early this morning saying that it is "creating more than 5,000 new full-time jobs in its U.S. fulfillment network" on top of the 20,000 it says it already has in U.S. warehouses. In a vague, cheerful style familiar to readers of its releases and financial reporting, the company said "median pay inside Amazon fulfillment centers is 30% higher than that of people who work in traditional retail stores--and that doesn't even include the stock grants that full-time employees receive, which over the past five years have added an average of 9% to base pay annually."
In addition, the company said it offers "programs like Career Choice, where we'll pay for up to 95% of eligible employees' tuition regardless of whether the skills they learn are relevant to a career at Amazon."
The Chattanooga warehouse is one of several built by Amazon in Tennessee after it came to an agreement with the state in 2011 similar to others around the country--Amazon agrees to collect sales tax eventually in a state in return for promising to hire a certain amount of people, making a minimum investment and, in some states, receiving state aid for the investment. In Tennessee's case, Amazon promised to build two warehouses at a cost of $350 million and employ 2,000 full-time workers in exchange for not beginning to collect sales tax until 2014.
As of the beginning of this year, Amazon had five warehouses in the state, which--as FedEx, Ingram and others can attest--is a ideal central location in the country for shipping. The Chattanooga warehouse is in the Enterprise South Industrial Park, whose largest tenant is a Volkswagen plant that builds Passats. For more than three decades, the site was a military manufacturing plant that primarily made TNT.
The president's speech is open only to warehouse employees and invited guest. As of yesterday, there was no information about when the president would land and whether he would visit anywhere else in Chattanooga. One group plans to appear at the warehouse: according to Geekwire, the Tennessee Campaign for Liberty will protest the president's support of the Marketplace Fairness Act, which would require large Internet companies to collect sales tax, a bill that Amazon supports.
Reaction among booksellers and others in the industry to the Obama visit has been decidedly negative.
"I am trying to understand how supporting a monopoly such as Amazon helps small businesses & middle-income Americans," Sheri Olson, owner of Reading Frenzy Bookshop, Zimmerman, Minn., wrote in a letter to the president over the weekend. Amazon's discounting "could be a death blow to the entire book industry--publishers, bookstores, authors," she continued. "When will the government help us? And at this point... not hurt us by supporting & broadcasting from this monopoly that is attempting to destroy the Main Streets of America. Please take this into consideration & change your location for your speech…. And please help small businesses such as bookstores stay alive."
In an open letter to the American Booksellers Association, Bruce Joshua Miller of Miller Trade Book Marketing called the Obama visit "truly shocking. The investigative series by Spencer Soper (published in the Morning Call newspaper in 2011) documented the very poor treatment of temporary workers at Amazon's Pennsylvania warehouse…. Furthermore, this visit comes at a time when Amazon, despite losing money in the most recent quarter, is attempting to further damage brick-and-mortar stores by lowering discounts to unprecedented levels.
"For both of these reasons, I urge you to speak out against Amazon's business practices, and the President's likely endorsement of them, whether this endorsement is tacit or explicit."