Amazon’s newest home in rural California

A new Woodland Daily Democrat article highlights Amazon’s venture to open a 75,000-square-foot fulfillment center outside of Orland, California. This is a large enterprise for rural Glenn County, which has a little over 28,000 residents and is designated as nonmetro by the USDA.

Residents and business leaders are hopeful that the new business center, located in unincorporated Glenn County, will boost the local economy and bring much-needed jobs. Although the City of Orland will not benefit from any direct taxes, the potential ripple effect from the influx of employees in the area could still help the city’s economy, with an anticipated increase in spending at local restaurants and more housing projects for the new Amazon employees.

Young residents are also looking forward to the job opportunities; the article notes that one high school student “said the idea of unloading and moving packages inside an Amazon facility would be a better job than the farm and construction work he’s been doing for comparable pay.” This student’s answer struck me in particular, as it hints at a shift in the younger generation's appeal from the rural agriculture background that envelops Glenn County to the corporate world that seems so unfamiliar to many rural communities.

Still, some residents have voiced concern about the secrecy surrounding the project. There have not been many opportunities for public comment, and the Board of Supervisors authorized a non-disclosure agreement with Amazon. Unfortunately, depending on when the facility opens, residents may not have much time to learn more about the project—although Amazon stated the location would open within the next year, Glenn County officials stated the opening could happen in the next 60 to 90 days. Some see this secrecy and expediency as evidence of the “imbalance of power between big companies and small communities.” Stacy Mitchell, who is part of the Institute for Local Self-Reliance, a national organization focused on helping local communities stand-up to large corporations, stated:

There is a huge asymmetry between the personnel and expertise and strategy and knowledge on the side of Amazon, versus any of the local communities, especially small ones, that are on the receiving end of the strategy… Instead of bargaining with the knowledge of the full worth and value of the community, they’re going in with a subordinate, subservient posture towards the developers and the corporations.

This is not the first time that large companies have decided to settle in small communities. Due to the increase in online shopping, companies are moving to unexpected rural areas to keep up with distribution, as many of these communities are located close to highway systems that can connect companies to a greater number of people. For example, California’s Central Valley has become a hotspot for fulfillment centers for companies like Costco, Safeway, FedEx, and Amazon. The Central Valley is close to the Bay Area and is home to many of the state's major roadways. Additionally, just north of Orland off of I5 in Red Bluff is a Walmart distribution center. Tehama County, where Red Bluff is located, has around 65,000 residents and is also a USDA designated nonmetro county. The Tehama County Economic Development department has designated the distribution center as one of the county's leading employers. Further, in 2020, Walmart's property taxes for the City of Red Bluff were over $28 million, which is a large increase from the $10.2 million they paid just nine years earlier.

One example of a rural state with a large distribution center is Alabama, where an Amazon warehouse is making headlines this week because employees are voting on whether to become the first unionized Amazon warehouse. These rural areas and states are not places one ordinarily imagines massive corporate fulfillment centers to be located. Yet, they are slowly becoming a more conventional part of rural communities because companies like Amazon and Walmart can use their capital and resources, which are largely absent in these communities, to bargain their way into rural America. While these centers do provide additional jobs and taxes, these large corporations will likely always have the upper hand.

Though the demand for these fulfillment or distribution centers has increased, companies are still not moving their headquarters to rural America. This blog discusses Amazon’s decision to locate HQ2 in Virginia and why companies stray from placing major headquarters in rural areas. Some reasons for avoiding rural communities or states include problems with broadband Internet and concerns with recruiting the best employees. Though a company’s headquarters could serve as a large economic stimulator for rural areas, as the blog points out, companies are looking for “superstar employees” coming from “superstar cities,” and do not see rural communities as capable of supplying them. Instead, companies have increasingly relied on the human capital in rural areas for distribution centers.

Companies may view these fulfillment or distribution centers in rural areas as more feasible for rural populations, which are seeing fewer students attending college and high unemployment rates. As stated in the Woodland Daily Democrat piece, not only is unemployment in Glenn County “consistently among the highest in the state,” starting wages in the facility will be at Amazon’s national minimum wage of $15/hour. Thus, fulfillment centers, while not recruiting from “superstar cities,” can hire employees in communities with high unemployment rates and low college attendance rates.

I am interested in seeing how this fulfillment center unfolds in Glenn County. I will continue to research the various attitudes toward the center and its impact on the local economy. I hope the center will alleviate the economic distress the pandemic has caused this small community.