I was annoyed by an article at Market Watch yesterday, headlined 'Amazon is going to kill more American jobs than China did'.
Amazon.com has been crowing about its plans to create 100,000 American jobs in the next year, but as with other recent job-creation announcements, that figure is meaningless without context.
What Amazon won’t tell us is that every job created at Amazon destroys one or two or three others. What Jeff Bezos doesn’t want you to know is that Amazon is going to destroy more American jobs than China ever did.
There's more at the link.
The article's basically a scare story about how Amazon's going to kill off up to two million American jobs, and replace them with a far smaller number of warehouse picking-and-packing positions. Unfortunately, it ignores a number of basic realities.
- Old-style jobs have been vanishing since the 1960's. The Internet merely accelerated that trend. Amazon isn't to blame for that - it rose out of the success of the Internet, and has built on that success with its own, but it didn't start the ball rolling.
- Companies who are currently struggling to attract customers, such as retail stores, often have themselves to blame for their predicament. They stock limited merchandise, employ the minimum number of store staff (many of whom have no idea what they're selling or how it works), offer minimal customer service (and that only because they can't get away with killing it completely), and focus on returns to their shareholders and bloated salaries for their executives, rather than attracting the consumer with his or her dollars. Funny, stores back in the '60's and '70's got that right . . . I wonder what changed?
- Yes, Amazon is threatening 'traditional' US jobs, but it is under threat itself. China's Alibaba Group and other mammoth Internet wholesale and retail suppliers are dominant in their countries, and expanding into the US market, just as Amazon is trying to expand into theirs. They're a major threat to any business, not just Amazon. Consider: "Alibaba's annual web sales easily surpass U.S. e-retail sales", and "Alibaba generates more revenue than Amazon and eBay combined". One false move by any consumer supplier, anywhere, and these competitors will take over in a heartbeat.
- It's a competitive, dog-eat-dog world out there. That's what ensures that companies such as Amazon and Alibaba innovate constantly, stay hyper-alert to latest trends, and do their very best to safeguard their own positions. If they don't, they're toast. What's stopping other companies, such as traditional retailers, from adopting a similar attitude? Why should they be protected from the same commercial realities that threaten Amazon every single day?
The world is changing. It's been changing since long before humanity emerged on the scene, and it'll go on changing long after we've vanished into the mists of history. Today's economic challenges are sometimes frightening, but the fact that they exist is nothing new. Every generation has faced economic challenges, from simply surviving in a time of famine and disease, to prospering in an era when everyone else is chasing the same dream.
Amazon isn't the cause of economic change. It's merely a symptom. Blaming it won't solve the problem. The only solution is to ride the tide of change, and adapt to it, and find new ways to stay afloat when the water level rises. Clinging to the familiar, stable rocks on the shore won't help when the tide's over your head. You'll still drown.
Welcome to reality.