Shaping Seattle

Businesses play a significant role in many aspects of city development, most notably generating jobs which attract and retain residents. Among other things, they influence the extent and direction of growth of the city, the supply and buoyancy of house prices, the quality of the environment, the extent of local investment, and the flow of traffic in rush hour. They affect our daily lives and experiences in cities.

Seattle's everyday city life has been shaped by 5 of the region's most profitable companies: Costco, Boeing, Microsoft, Amazon and Starbucks. Their impacts on the Seattle region have included the creation and distribution of jobs; development of architecture for corporate real estate (office campuses, warehouses, factories and storefronts); strengthening of the city's identity; attraction of investment and startups; and attraction and retention of a talented labor force. 

Seattle's top companies have changed the nature of life in cities all around the world. These city sculptors impact the way we work, the way we move (and move stuff), and the way we shop (and spend). Their impact extends to the things we like, as well as the look and feel of our neighborhoods. Looking to the future, they are also influencing the way we approach emerging challenges facing cities. 

In the 1970s, Seattle's economic base was in decline. Boeing, the company which helped put the Seattle region on the map, was slashing jobs. Referencing the extreme job losses which had affected the manufacturing and lumber industries on which the local economy was dependent, a billboard mockingly displayed near the airport for 2 weeks in 1971 asked "Will the last person leaving Seattle - Turn out the lights". With an unemployment rate of 13%, double the national average, Seattle was dubbed the "city of despair" (Laktis 2009 and Yang 2014). 

3 decades on and Seattle is one of the fastest growing cities in the USA. 

The way we work

The incessant introductory question at social gatherings in Seattle "Do you work for Microsoft, Amazon or Boeing", reflects the high proportion of the region's residents who are directly employed by one of these anchor companies. The relocation of Microsoft's headquarters to the Seattle region in 1979 is credited as a key factor which helped re-attract investment to the struggling city (Yang 2014). Today, the company directly employs in excess of 40,000 people in the Puget Sound region (Tu, 2014). It is estimated to have created 80,000 skilled and 120,000 unskilled flow-on jobs for the local economy (Moretti 2013). In addition, countless former employees have formed new companies which have remained in the area (Yang 2014) (1).

The tech talent pool, fostered by the relocation of Microsoft, has helped to attract other companies to the region. Amazon located in Seattle to build its online retail company due to the talented workers available in the area (Yang 2014). Approximately 17,000 Amazon employees are based in the Seattle region and their "day-to-day needs... have given rise to another 85,000 skilled and unskilled service jobs locally" (Yang 2014). Boeing is one of the largest employers in the USA, and although it no longer has its headquarters in Seattle, the company has approximately 80,000 employees in Washington State (Boeing 2014).

Across the world, Microsoft has dramatically changed the way we work. Microsoft's MS-DOS, Windows and Office software, created user-friendly and affordable computers. These innovations changed city life, helping offices in cities all around the world to work more efficiently. As personal computers have become more affordable, smaller and mobile, people have increasingly been able to work from home. For many, their local Starbucks transforms into their office, thanks to the ubiquitous cafe offering free wi-fi. Boeing's impact on the affordability of air travel has also improved connections between cities, enabling increased travel for business purposes.

Map of main locations of Costco, Boeing, Microsoft, Amazon and Starbucks.  

The way we move (and move stuff)

Boeing has a long history in delivering advancements in aviation which have influenced the movement of people and goods across the globe. The launch of the jet propelled Boeing 707 in 1958 is often credited as one of the most significant developments in commercial aviation (1), making the world more connected by making air travel more affordable and accessible. Today more than ever, people fly all around the globe for work, travel and migration. These movements are undeniably made easier thanks to the speed, comfort and affordability of modern aviation. A film shown at the commencement of the Boeing Factory Tour also explains the role of Boeing aircraft in freight, helping to deliver fresh produce around the world. 

Companies such as Amazon capitalize on innovations in aviation and IT systems for its logistics. Amazon has 'fulfillment centers' (warehouses) strategically distributed across the USA, as well as in several other countries. These centers are located for the most efficient transportation of products (and no doubt the cost of labor and land). Amazon uses algorithms to calculate the most efficient warehouse to transport a product to a customer from, as well as to assist employees prepare orders by calculating the most efficient route to find the items in such incredibly large warehouses. The systems, which also calculate the time moving an item should take and compares this to staff performance, have often been criticized for their radical surveillance of workers which pressures them to meet unrealistic expectations. The way Amazon does business is set to continually change as the company increasingly invests in robots to automate and improve the efficiency of warehouse packing and distribution. While these innovations will continue to impact jobs for similar warehouse based companies, it will also impact the speed and cost at which we can buy goods.

The way we shop (and spend) 

Costco, one of the largest retailers in the world, has a membership system which offers customers items in bulk to receive discounts (3). While Costco's retail format has made many products more affordable to consumers, it also has had on impact on the amount we buy. It doesn't matter that you are purchasing a ridiculous amount of spinach or more toilet paper than you will ever need in a lifetime, it's just so cheap there's no need to question it! 

Amazon recognized the potential of the internet to "banish geography, enabling anyone with an Internet connection and a computer to browse a seemingly limitless universe of goods with a precision never previously known and then buy directly from the comfort of their homes" (Wasserman 2012). The company's original focus on books, coupled with the development of an online ordering system and efficient and affordable delivery, revolutionized the way we purchase publications. The company recognized the potential for digital books and with the introduction of their Kindle e-reader in 2007, deconstructed the assumption that people would not be attracted to reading books on a screen. This innovation has changed the way many of us read, and increasingly we are turning away from physical books. Many blame Amazon for 'destroying' local retail. With Amazon enabling a global and time-poor audience to buy from the comfort of their own home, receive speedy delivery and cheaper prices, it is very difficult for brick-and-mortar stores to compete. 

The things we like (our tastes) 

Since it was founded in Seattle in 1971, Starbucks has been influencing not only the coffee culture of Seattle, but of the world. The coffee emporium, credited with establishing American's taste for cafe lattes and macchiatos, now serves in excess of 70 million customers a week in over 60 countries. In addition to sourcing and selling coffee beans, selling cups of coffee and educating people on how to make a coffee at home, the cafe influences popular culture. Starbucks takes pride in selecting the music played in its stores as well as featuring artists via free I-Tunes downloads or selling CDs.  

While Seattle is said to have a rich literary history (4), Amazon, Costco and Starbucks have enhanced the city's reputation as a 'book city' and a tastemaker which significantly shapes the books Americans and people all around the world choose to read (Bick 2008). 

Amazon, Starbucks and Costco have had a monumental impact on our reading habits:  

"Books by relatively unknown or foreign authors become best sellers by dint of their anointment at the hands of Amazon editors. A forgotten older paperback, recommended and featured by the book buyer at Costco, can sell more copies in six weeks than it did in the last few years combined. Almost every book Starbucks stocks in its coffee shops sells more than 100,000 copies in its outlets alone. That pushes most Starbucks selections into the top 1 percent of all books sold that year, without counting sales in other types of stores" (Bick 2008). 

Amazon's computer programmers layer recommendations by publishers and reviewers with customer purchase histories to create personalized reading lists for there customers, shaping what books they buy (Bick 2008). Amazon employs an algorithm which customizes product recommendations for customers, indicating what other people who purchased the same item also brought. By highlighting items which people with similar taste have made, it has a significant impact on shaping the products we consider, whether they be books or otherwise.  Starbucks originally sold books with the idea of that customers would spend more time (and consequently spend more money in store) if they had a good book to read (Bick 2008). Despite Starbucks' impact on the books we read, they are far from a book store, only focusing on selling one book at a time for a month or two. Yet the book's placement in thousands of Starbucks stores may mean that a million people see the cover every day as they wait in line for their coffee, dramatically raising exposure (Bick 2008). Costco is also selective, offering approximately 250 books across its stores, featuring best sellers and lesser known recommended titles (Bick 2008). While these companies offer books conveniently online or as a customers go about their daily coffee or supermarket shop, their success of responding to and shaping our reading tastes has impacted the viability of the local bookstore. 

The character, design and layout of the city

The format of these companies has impacted on the urban and social landscape, firstly of Seattle, and of cities all around the world. Amazon and Costco's competitive pricing and big-box warehouse format, as well as Starbucks' ubiquity, is impacting the viability of local retailers in neighborhoods. With so many Starbucks cafes, sometimes even across the street from each other, and other retailers mimicking the company's franchising model, it can be difficult to find an independent and locally run cafe. Amazon and Costco's diverse products with the convenience of a 'one-stop-shop' for everything from groceries to clothing, many small local neighborhood stores have been unable to compete. The nature and diversity of our neighborhoods is changing as more of these little retailers close. The grocer or baker within walking distance is disappearing: large warehouse format retailers with everything under the sun, like Costco are a car trip away or online grocery delivery services like Amazon Fresh can be accessed at the click of a button. 

Reifman (2014) provides a more critical analysis of the impacts of Amazon, and other corporations on Seattle. He calculated that Amazon's planned office space in the city would have capacity to employ between 5 and 7 percent of the city's population (5). He fears Seattle's "Amazon-fueled future" will create a city which is:

 "more male, even more white, wealthier and less diverse, unaffordable to those with lower incomes." 

Reifman identifies many existing and potential drawbacks of Seattle's development by big companies as a technology hub. He fears the decreasing social diversity has the potential to undermine one of the central qualities which makes a city vibrant. These companies, he feels, have an immense political influence on decision-makers. Similarly, their employees have a significant impact on city development. High earning technology professionals employed by these companies have been considered to generate demand for housing which has pushed up housing prices and escalated new development (6). As this has occurred many have been concerned about the increasing disparities in wealth across Seattle. 

Boeing's Everett factory is the world's largest building by volume (7). One of Amazon's 'fulfillment' centers is large enough to hold 28 American football fields (8). Although Costco, Boeing and Microsoft are iconic Seattle companies, all are based around 20km away from the center, a locational preference which historically made economic sense for businesses which required such a great deal of space. Amazon's Seattle headquarters however are located in South Lake Union, a redeveloping neighborhood adjacent to Downtown (9). Amazon's presence here is playing a significant role in shaping the design of this former warehousing district. Amazon's $1.1 billion investment in their original campus and $266 million investment in new buildings in the area, is shaping South Lake Union's built environment and is attracting other developers. South Lake Union is often suggested to be a model for future urban development, in which large businesses are creatively integrated into the existing urban fabric rather than on the edges of cities (10). (Read Drawn to cities profile of this neighborhood here). 

The way we will tackle challenges facing cities

Microsoft's CityNext initiative uses technology to develop solutions for the challenges faced by cities. CityNext is aspiring to help city leaders, developers and citizens to understand and respond to city dynamics (Lambert 2014). Building on Microsoft's software, CityNext digitizes infrastructure and services to assist with the efficient  management, monitoring and planning of traffic, assets, finance, smart buildings, city infrastructure, water and wastewater, energy and carbon. Microsoft CityNext is identifying the potential for cities all over the world to learn from each by sharing the outcomes of processes, models and architecture (Lambert 2014). 

Conclusion  

Although big business plays a significant role in shaping cities, the influence of small independent businesses should not be forgotten. While big businesses, particularly Costco, Starbucks and Amazon have opened up larger, international markets and opportunities for local businesses to sell to, on the flip side they have also created more globally competitive environments which threaten their viability. The loss of small, unique and independent stores has altered the vitality of street life, with much of the activity of businesses relocated inside large warehouses across the world (11). 

Seattle's economy is dependent on the performance of these top companies. As shown in the 1970s, a decline in Boeing's production had an immense ripple effect, generating losses of both direct and flow-on jobs. With such a high percentage of people in the region working for one of a handful of businesses (or a company which supplies them), Seattle's ties to these businesses could be a potential disaster in the event one faces a downturn. Despite such concerns, these companies have undeniably contributed many benefits, most notably helping to position Seattle as one the fastest growing and wealthiest cities in the USA today. 

Notes

1. Former Microsoft employees have started approximately 4,000 businesses, many which have stayed in the Seattle region and generate thousands of jobs (Yang 2014). 

2. The de Havilland Comet was the world's first commercial jet airplane entering service in 1952 (Pushkar 2002).

3.  Costco employs a warehousing format and sells everything from clothing, food, gas, insurance, appliances and home goods. 

4. Seattle's literary nature is said to be also shaped by the presence of local authors, many writing courses and independent bookstores, as well as the rain which is speculated to have made reading attractive to residents. The City of Seattle has also invested $200 million in its libraries over the past decade, and has most notably developed the state of the art Seattle Library designed by Rem Koolhaas (Bick 2008).  

5. It is estimated that Amazon's office space in Seattle has capacity to employ approximately 45,000 people (Reifman 2014).

6. Seattle's development is considered by some to have helped the city's resilience during the recession, whilst others feel the impact on neighborhood character and the city skyline has been detrimental.

7. The Boeing Everett factory is 13,385,378 cubic meters (Boeing).

8. One of Amazon's fulfillment centers, located inPhoenix, Arizona comprises 1.2 million square feet (D'Onfro 2014).

9. South Lake Union is predominately being redeveloped by Microsoft co-founder Paul Allen's real estate company Vulcan. 

10. Interestingly South Lake Union has no gas stations, installing charging stations for electric cars instead (Yu 2014). 

11. As just one example of this, online retailing has resulted in a substantial decline of independent book stores over the past 2 decades. Many neighborhoods have witnessed the disappearance of the small local small store they could walk to and browse.

References / Extra reading

Bick, Julie. 2008. Book Lovers Ask, What’s Seattle’s Secret? New York Times. 9 March. 

Boeing. Everett Tour

Boeing. 2014. Boeing Employment Numbers

Boeing. 2014a. About Us. July, 

D'Onfro, Jillian. 2014. What it's Like Inside One of Amazon's Massive Warehouses. Business Insider Australia. 29 November. 

Laktis, Erik. 2009. Iconic "will the last person" Seattle billboard bubbles up again. The Seattle Times. 2 February.

Lambert, Rebecca. 2014. Microsoft CityNext: driving momentum to build smart, sustainable cities. On Windows. 3 October.

Manjoo, Farhad. 2012. I want it today. Slate. 11 July.

Marshall, Colin. 2014. Amazon's new downtown Seattle HQ: victory for the city over suburbia? The Guardian. 22 May. 

Moretti, Enrico. 2013. The New Geography of Jobs. Houghton Mifflin Harcourt Publishing Company. 

Pushkar, Robert G. 2002. Comet's Tale. Smithsonian Magazine. June. 

Reifman, Jeff. 2014. 'Armageddon': How Amazon's culture is taking a toll on Seattle's Future. GeekWire. 19 November.

Starbucks Newsroom. 2014. Virtual Road Trip: Seattle Starbucks Reflect Company’s Past and Future. 28 August.

Tu, Janet I. 2014. Microsoft lays off 2,100 employees, 747 of them in local area. The Seattle Times. 18 September. 

Wasserman, Steve. 2012. The Amazon Effect. The Nation. 29 May.

Williams, Nathan. n.d. Ten Biggest Employers in Seattle Area. About Travel. 

Yang. Andrew. 2014. The Entrepreneurs Who Saved Seattle. Fast Company. 9 June. 

Yu, Hui-yong. 2014. Seattle Property Boom Shaped by Three Women Remaking City. Bloomberg. 16 October.