New Amazon ‘foothold’ in Coral Gables signals area’s tech future: Less office space needed
If you missed the news last week that Amazon had finally planted its flag in Miami with a new office, you’re probably not alone.
Four years after the great race to attract Amazon’s ‘HQ2’ — and with it, 25,000 jobs and as much as a $1 billion investment, what Miami has gotten instead is emblematic of the new era of tech in which the area finds itself.
On March 15, the Wall Street Journal reported that Amazon had established a “foothold” here by leasing 9,000 square feet at the WeWork complex in Coral Gables for some 100 employees, with plans to hire about 60 more.
It’s usually a bad idea to thumb your nose at the arrival of high-paying jobs, and the news was the kind of announcement that would have made headlines before the pandemic.
But thanks to COVID-19, Miami has become the No. 1 destination on the East Coast among professionals — especially ones in tech and finance — fleeing lockdown restrictions in other cities to move here and work remotely.
So the Amazon development turns out to be more of what the area has been getting during the pandemic: a tech outpost staffed by fewer employees who require little infrastructure beyond a laptop computer. Notably, Miami is not among Amazon’s 18 official “Tech Hubs,” which come with a larger physical footprint.
That means continuing to set aside the expectation of a massive, broad-based, corporate investment effort in the Miami area — the kind that Brookings Institution senior fellow and policy director Mark Muro recently told the Miami Herald has accompanied traditional economic development strategies.
Against this backdrop, the Miami area is losing a race against soaring housing prices. New data from CoreLogic show Miami leads the nation in single-family rent inflation, with costs climbing 39% year on year. There is not a 1-to-1 correlation between the tech movement and the rising cost of living; the rest of the country also finds itself in the midst of a housing crunch. But the severity of Miami’s problem stands out, and the sudden influx of so much wealth is exacerbating the city’s and county’s housing woes.
No one is doubting that the vision of Miami tech has reached a zenith, with more tech workers, and more tech investment, than ever before. Miami Mayor Francis Suarez has given a masterclass in rebranding the city from fun-and-sun to a coveted destination for serious professionals seeking work-life balance and a business-friendly environment. He has also sought to expand opportunities for all Miami residents to take part in the tech movement, seeding a new tech high school with Miami Dade College, while tasking his Venture Miami group to find other ways the tech expansion can benefit more people. The allocation of more than $5 million generated from MiamiCoin for housing assistance is no small feat, even if the project’s future remains uncertain.
And in many ways, Amazon is an exception among tech-oriented firms that have planted a flag here. In addition to those 100-plus Gables employees, Amazon now employs 10,000 full- and part-time workers at its various distribution hubs throughout South Florida, including its landmark fulfillment center in Opa-locka. With a starting local salary of $15 an hour, these are the kinds of working-to middle-class jobs that many elected officials dream about when they discuss mass economic development.
Amazon is also a key hiring partner for Miami Dade College, too. There, students can complete a tailored Amazon Web Services certificate program that virtually guarantees them consideration for an Amazon job.
But Amazon’s exceptionalism highlights the larger issue contained in what has come to be accepted as a piecemeal approach to building out Miami tech.
Unless greater demands are placed on the firms and even individuals arriving here to do more than simply live, work, and play in Miami, the cost of living will continue to outpace the ability of average Miamians to afford living here.
This story was originally published March 20, 2022 at 6:00 AM.
