New Amazon distribution center in Cecil County brings hope to corridor

The announcement that Amazon would open a new distribution center in Cecil County brought hopes that the warehouse could revive the Northeast Maryland Interstate 95 corridor as a distribution stronghold.

The 1.2 million-square-foot distribution center, to be built in a business park in North East near an existing Restoration Hardware warehouse, is expected to employ 700. The Maryland Commerce Department will loan Amazon $1.2 million for the project from the Maryland Economic Development Assistance and Authority Fund, while Cecil County's government approved a $120,000 conditional loan on Tuesday night.

Amazon said it will invest $90 million in the center.

"The whole Harford, Cecil County corridor has traditionally been a center of distribution but hasn't been growing as much as it had," said economist Richard Clinch, director of the Jacob France Institute at the University of Baltimore. "It's unambiguously good news."

Cecil County's unemployment rate was 4.5 percent as of November 2016, the latest figures available. The state's unemployment rate that month was 4.1 percent.

But Greg LeRoy, director of Good Jobs First, a Washington-based nonprofit that studies government economic incentives, predicted that many of the 700 promised jobs wouldn't be new and that Amazon would simply attract workers laid off from jobs in the retail sector.

"There are hundreds and hundreds of retail jobs that have been lost in Maryland in recent years as people are shopping online and not going into stores," said LeRoy, citing The Limited and Kmart as examples. "Retail jobs don't grow unless more people have more disposable income."

The jobs at a warehouse like Amazon's pay better than a retail clerk, LeRoy said, but they are also more physically arduous and often require workers to work late or early shifts.

LeRoy criticized the state and local incentives to Amazon, saying that building distribution centers near big cities was already part of Amazon's plan to make its same-day delivery more widely available and that incentives weren't necessary.

Amazon opened another distribution facility in Baltimore in March 2015 in Baltimore after the state and city offered incentive packages of more than $43 million. It now employs 3,000.

Dan Schneckenburger, a Cecil County council member who voted to approve the incentive deal, said the county has already garnered $400,000 in revenue from permit fees from the building, which he contrasted with the $120,000 loan incentive.

"It's the nature of economic development," he said. "I get the criticism, but we don't have enough jobs in Cecil County. I'm very happy with Amazon and very happy with the job creation."

Amazon did not respond to a request late Wednesday for a comment on the incentives or the new facility.

Schneckenburger said the jobs will be at a variety of skill and wage levels.

"What we've seen is that a lot of these jobs are evolving into a multidisciplinary workforce," he said. "It's not like the companies you've seen in the past where all they need are forklift drivers."

Clinch said that the Cecil County area had strong growth in the distribution sector in the 1990s nut had languished in recent years. He said the Amazon center could help draw more distribution companies to the area.

While economists said the local workforce in Cecil County likely would absorb most of the jobs, Anirban Basu, chairman and CEO of Sage Policy Group, an economic and policy consulting firm, predicted that the area might experience some population growth.

"People are willing to move to that region because the cost of living is quite favorable," he said. "It's a place where one can afford a house."

Basu said more distribution jobs along the Harford and Cecil I-95 corridor could follow.

"They have available industrial zoned land, they have an affordable workforce," he said. "It is conceivable that the number of jobs will be much higher than that."

Principio Commerce Center I, the new facility, is under construction and expected to be completed this spring. It's being developed by Trammell Crow Co. and Diamond Realty Investments.

In Cecil County, many lauded the news.

"I think it's just incredible," said Roger Owens, the past chairman of the Elkton Alliance and owner of a financial services business and two laundromats. "We're one of the few green spots left in the 95 corridor for expansion. This is our opportunity to shine and move forward."

Owens said he notices a boost in business at his laundromats from workers on the Conowingo Dam and said he thought more employed workers would help uplift small businesses throughout the area.

"It trickles down to my little laundromats," he said. "When things get done around here, everyone has a chance to get something out of it."

cwells@baltsun.com