Amazon needs no introduction. It is one of the biggest e-commerce companies in the U.S that has completely changed the game for everyone. For an average American, Amazon is essential to their living, and this mindset has shaped the American economy in recent years.
Here are some of the essential statistics that will help you understand the importance of Amazon:
- Amazon had more than 150 million mobile users in 2019
- According to a survey of more than two thousand U.S customers, 89% of them agree that they buy products from Amazon rather than other e-commerce sites
- In the fourth quarter of 2020, Amazon made more than $125 billion in sales revenue
- On average, small businesses in the U.S sell more than four thousand items per minute
- Currently, Amazon has more than nine million sellers, out of which almost two million sellers are active.
Now that you know how vital Amazon is to the U.S economy, let’s understand its economic impact in-depth.
Amazon’s Presence in Ohio
We are all familiar that Amazon does not have any storefronts. Instead, it opens fulfillment centers around the U.S. Currently, Amazon has fulfillment centers in West Jefferson, Etna, and Obetz in Ohio.
Besides that, Amazon owns a hundred-megawatt wind farm in Paulding County and two solar farms. The company employs more than seven thousand residents of Ohio for jobs. These include many jobs from fulfillment to engineering to many others.
Gradually, Amazon is trying to move into Ohio to create more jobs and enhance the economy. According to the U.S Bureau of Labor Statistics, Ohio lost more than three thousand manufacturing businesses from 2001 to 2011. It was also struggling in other industries, because of which Ohio has suffered significant losses.
Funding the Ohio Economy
Amazon does not just create jobs and employment. It also tried to help the residents of the state and the economy. That is because it finds small but meaningful ways to boost the economy.
For example, Amazon provided a $10,000 grant to an organization that offers daycare programs and vocational job training in Euclid, Ohio. Amazon also funded the robotics team of Watkin’s High School. More than twenty high schools across Ohio are receiving funds from Amazon Future Engineering Program.
Local leaders of Ohio have said that such investments can completely transform the lives of the people living there. Amazon is trying its best to change the community and boost the economy so the states can flourish. The retail giant has also provided donations to local bus services for the elderly, fire departments, police departments, and much more.
Overall, since 2011, Amazon has invested more than two billion dollars in Ohio. Apart from the direct hires by the company, it is estimated that with such funding, Amazon has created more than nine thousand indirect jobs. The retail giant is quickly becoming the most critical employer in Ohio.
Amazon and the U.S Economy
Now that you understand the impact of Amazon in Ohio let’s understand how this retail giant has impacted the entire U.S economy. The e-commerce site started with books, and now it sells everything from electronics to dinnerware to fitness equipment.
Amazon has anything and everything that an average American consumer could ever want. In 2019, Amazon accounted for 4% of the entire retail sales in the U.S. On the other hand, the pandemic also increased sales as more people started online shopping in 2020.
That is why in the first quarter of 2020, Amazon’s retail share went up more than 25%. These spikes are a good sign because it means that it contributes more to the GDP. However, as of now, consumer spending is not vast enough to affect the GDP scale.
Job Creation by Amazon
The most important thing any business can do is create jobs for the residents and people of the city it operates in. By the end of 2020, it is estimated that Amazon employs more than one million people worldwide. Even in 2020, Amazon created more than four-hundred-thousand jobs.
Of course, this number would be higher if Amazon had storefronts. Other businesses such as Walmart employ more people than Amazon, but they have a significant storefront presence. Besides that, Amazon hires third-party contractors for jobs such as deliveries.
It allows Amazon to keep its own costs in check while ensuring that it employs other people to circulate the money in the U.S economy. So, Amazon creates jobs directly and indirectly in all the cities it operates.
Helping Small Businesses
The most important contribution of Amazon is the fact that it helps small businesses worldwide. That is because these businesses can list themselves on the website and enhance their customer reach. Of course, how to deliver these products is Amazon’s headache.
In 2017, over two-hundred thousand small and medium businesses crossed $1 million in sales worldwide on Amazon. As these small businesses do well and keep in thriving, job creation is bound to happen. As a result of the Amazon Marketplace, more than 900,000 jobs were created.
That is why it an essential facilitator of small businesses globally and in the U.S. These businesses rely on Amazon to help them increase their audience beyond their geographical limits. So, even if Amazon is not creating jobs directly, it still supports the economy by facilitating small businesses, which employ more and more people as they grow.
Overall, Amazon has significantly helped the states and cities it operates in the U.S and globally. However, the company has been under fire many times for not providing excellent working conditions to its employees. Of course, according to the retail giant, it offers fair wages and working conditions to all its employees.
No business is perfect, and we need to see if the positive results that Amazon brings outweigh the negative. Of course, the company has to provide favorable working conditions and fair wages to all its employees. After all, one of the biggest e-commerce giants can’t set such an example for the rest.
About the Author
Dustin Flick is a career mentor and professional coach in training. He became interested in Amazon and other major employers after working to understand the typical job mobility for entry level workers in the US. Most recently he’s written about Amazon Jobs in Columbus Ohio where the company has added a stunning 8,000+ direct and indirect jobs.