Florence, Ky. – Northern Kentucky University’s top economic analyst expects Amazon’s $1.49 billion expansion of its e-commerce operations in Boone County to impact industry growth, air cargo operations and salaries for workers positively.
“Greater Cincinnati is one of the top ten e-commerce hubs in the United States,” said Janet Harrah, senior director of the NKU Center for Economic Analysis and Development. “The Amazon expansion will be helpful to economic growth of that sector… that along with manufacturing jobs.
“A lot of suppliers will be looking for warehouse space.”
Amazon announced plans in January to locate a major air shipping operation on 900-plus acres at CVG that will bring 2,700 jobs and 40 Boeing 767 cargo jets to Northern Kentucky. Harrah included the impact of Amazon’s services in a regional economic analysis presented to the Florence Rotary Club on Monday, February 27.
She expects a 6 percent growth in jobs in that sector of industry as a result of the Amazon deal. DHL already operates one of its three North America superhubs at CVG, and the airport ranks as the ninth largest hub in the United States, she noted.
The addition of 200 cargo operations a day likely will result in a large jump in the rankings. The job demand will create “real competition for workers making $15 to $18 per hour,” Harrah said.
She expects growth in growth domestic product (GDP) for the eighth consecutive year both nationally and locally. Her forecast calls for economic growth of 1 to 1¼ percent and inflation around 2½ percent.
“We’ve seen an ongoing pattern for seven to eight years of slow, moderate, steady growth each year,” Harrah said. “This year, we expect a continuation of what we’ve seen.”
Rising oil prices have been one of the primary factors fueling that growth, according to Harrah. However, she doesn’t expect to see a big increase in the cost of gasoline at the pump – perhaps an average increase of 50 cents per gallon or an additional $500 in costs to the consumer for the year.
Other factors fueling growth cited by Harrah are the housing market – which has rebounded from recession lows – capital investments and international trade. The dollar remains strong in international markets and the stock market has climbed to record levels since the presidential election.
“The election highlighted how important the U.S. economy is to the rest of the world,” Harrah said. “If our economy is doing well, it bodes well for them. They sell more to us than they buy.”
