business news in context, analysis with attitude

Really good piece from the Los Angeles Times about the impact - social, cultural, infrastructural - of the pandemic-fueled e-commerce boom, which "accelerated the land grab" for warehouse space in California's Inland Empire.

The area, the Times writes, has become "ever more hardscaped into the staging point for trains and trucks carrying goods from the ports of Los Angeles and Long Beach to the rest of the nation.  There are 170 million square feet of warehouses planned or under construction in the Inland Empire, according to a recent report by environmental groups. And despite fears of a recession, demand hasn’t ebbed."

According to the story, "the rapid transformation of semi-rural areas into barrens of concrete tilt-up 'logistic parks' is encountering a backlash. Residents are questioning whether they want the region’s economy, health, traffic and general ambiance tied to a heavily polluting, low-wage industry that might one day pick up and leave as global trade routes shift.

"Several Inland Empire cities, including Colton and Norco, have placed building moratoriums on warehouses, as has Pomona, which borders the region. Environmental groups are pushing Gov. Gavin Newsom to declare a state of emergency, hoping to keep new warehouses away from homes and schools, where heavy truck traffic can expose children to high levels of toxic diesel emissions that have been linked to respiratory illness."

The politics of the situation are complicated, as a number of local officials say that the warehouse boom has had a number of benefits - an expanded tax base, jobs, the creation of affordable housing, and improvements to the area's infrastructure.  (To be fair, activist groups say that these politicians also are in favor of the donations they get to their campaigns.)  On the other side, some say that unregulated growth will have enormous and long-term negative impacts on the environment, public health, and local communities.

Some context:  "The logistics industry has moved into a void left as higher-wage jobs in manufacturing, defense and aerospace disappeared, converting largely agricultural and vacant land into the hub of America’s retail economy. The industry added more jobs in the Inland Empire than in any other part of the state. In 2022, it created 24,400 jobs in the area; in 2021, it created 27,400, according to John Husing, an economic consultant who specializes in logistics in the Inland Empire. Median wage ranges from $18.57 an hour for warehouse workers to $24.93 for drivers, he said."  However, some "economists say many of those jobs don’t pay close to a living wage. The median hourly pay in the region is almost $5 below the California average, and turnover is high because of the grueling, nonstop work."

KC's View:

This is such a complicated issue.  There's no question that the logistics industry that has changed the landscape of the Inland Empire has brought jobs and some economic advantages, but those things come at a cost, largely to the agricultural entities that are being displaced and the middle-income folks who are seeing their communities falling under the shadow of enormous warehouses, breathing in the exhaust of a seemingly inexhaustible parade of diesel trucks.

It isn't this simple, of course, but I tend to frame the discussion in my mind this way:  Would I want to live in one of the communities being forever changed by this hardscaping?  Would the leaders of the companies and the politicians who support them want to?  The answer to these questions is no … and in the same way that the golden rule ought to dictate our behavior toward each other, maybe it ought to be applied to how we treat our communities and neighborhoods.  Is it to much to say, I will treat every community as if it were my own?

(BTW … whenever I see the term "Inland Empire," I cannot help but think of Jack Brown, who used those words so often when he served as the president-CEO-chairman of Stater Bros.  He didn't just define that company for decades, but in so many ways he seemed to define that region of California.  I also cannot help but wonder how many people don't know that name and don't remember him.  Maybe that's a function of getting old…)