Hugh Andrew: Amazon jobs come at a high price for Scotland

Published on Thursday 8 December 2011 12:24

The online retailer’s investment has been celebrated by the SNP, which even helped fund it, but it represents a death knell for many independent businesses

THE Scotsman published an article recently containing seemingly unalloyed good news. Amazon is bringing 750 full-time staff and 750 seasonal staff to Scotland. A further 900 are said to be following at Waverley Gate in Edinburgh. And all this for the expenditure of a mere £10.6 million of government money. The pages of the paper were full of laudatory quotes and the government, of course, made the most of this announcement. Surely it is time we looked at the real story behind it?

It is this story that reveals the utter moral and economic bankruptcy at the heart of Scottish government.

Let us stand back and look at Amazon. It is a retailer, pure and simple. In a time of flat retail expenditure, its market share expands in only one way: at the expense of others. Those others are the high street and town centres across the UK, those others are independent businesses struggling to survive in an ever bleaker environment. It is a company that has paid minimal UK tax (apart from National Insurance) in at least the past three years. It is a company that has specialised in minimum-wage labour under no contractual protection whatsoever (last year it was censured for its behaviour in Greenock where, when the work finished in the small hours, workers were left unpaid and with no means of getting home). It is a company whose market share has grown to a great extent by predatory pricing and elimination of rivals through purchase. In a completely deregulated market it has proved a remarkably successful strategy. Don’t get me wrong. It is good at what it does. I buy from Amazon too! But I am not blind as to what it is. However, that this company should receive more than £10m for the privilege of being allowed to enhance its market dominance from taxpayers to whom it contributes little directly beggars belief.

Let us look a little closer at the monies given. This money would have paid near enough the ENTIRE salaries of those who work in the Scottish independent book industry for a year. How do they feel knowing their government is acting as a free advertisement for a company whose growth represents their death knell? How do the owners of the small bookshops of the North-East feel when their First Minister, their MSP, proudly announces he doesn’t support them, he supports an American behemoth?

One hundred years ago this country was the publishing centre of the entire world, a mere ten years ago or so a Scottish company was one of the largest booksellers in Britain. And now we are reduced to buying pick-and-pack and call-centre jobs with taxpayers’ money and boasting about it. This is the Scots crisis of confidence writ large and made government policy. Nor is this the first time this tawdry charade of the fake “good news” announcement has been used by government. Last year the First Minister announced proudly all the new jobs that Sainsbury’s would be bringing to Lanarkshire. Sadly there was no countervailing announcement about the Scottish jobs that the supermarkets would cost, the Scottish suppliers who no longer would have access to their market because their local outlets had been driven out of business. Research has shown again and again that supermarkets are net job destroyers, not job creators, and yet government continues to support them, stifling enterprise and encouraging monopoly.

At the root of this complete incoherence is a simple yearning: that of the politician for “good news” stories, and big ones at that. Unfortunately, this is something no small business can provide. Big “wins” need big business, and so in a sordid embrace politicians and business lurch incoherently along, filching the public purse. There is, after all, no news story to be tweeted or proclaimed in “more small shops in Scottish town” or in organic growth, and no photo opportunity for the aspiring politician.

For me as a Scottish businessman, with both bookselling and publishing interests, I watch with sadness and despair how a party that claims to be about restoring pride in Scotland has become merely a tool of interests inimical to the communities and people it claims to serve. For a small country to seek and buy the temporary attention of global multinationals is rather like a small furry animal seeking the loving embrace of a python.

Every big Amazon-type announcement, every new supermarket opening is another small death of Scotland. And how ironic that our new Amazon warehouse is beside the deserted Hyundai site which only a few years ago was trumpeted as a new Jerusalem for Scottish jobs. There is nothing new in pronouncements such as these – they belong to the same school as the “picking winners” philosophy of Labour in the 1960s and 1970s, the failed industrial policies of the last century.

Ultimately business flourishes not because of subsidy but profit, and it is the creation of a flourishing economic ecosystem which enables that profit to be generated. Every distortion, every subsidy represents not an enhancement of that ecosystem but its slow death. And to add insult to injury, it is indigenous business that will pay for its own destruction through a 5.6 per cent increase in business rates in the worst recession in our lifetimes.

The true irony of the SNP position is that it had and still has an enormous opportunity to articulate a genuinely different way of doing things, to create long-term strategic planning which creates demand in an economy, which works with Scottish business and not against it, to decentralise and not continue relentless centralisation. The SNP’s tragedy is like Faust’s: to achieve the one thing it dreams of, it has sold or forgotten everything that could make that dream viable and coherent. Surely it must perturb intelligent Nationalists that they are asked to vote not to make a difference but to continue with the same failed policies of previous governments. And surely the strongest argument against independence is precisely this: that it will produce no change, no hope and no dream.

At the end of Mussorgsky’s great opera Boris Godunov, the people of Russia hail as their great white hope the False Dmitriy. They are left alone on the stage as the Pretender’s troops march on to Moscow, alone with the dawning realisation that they are merely a tool for the powerful, and that the Pretender represents not hope or freedom but its opposite. Is this the prospectus that Scotland is now being offered: a new False Dmitriy for our times?

• Hugh Andrew is a partner in bookseller Yeadon’s of Elgin and Banchory, and managing director of publisher Birlinn

Comments

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26

Mark Harper

Wednesday, April 25, 2012 at 09:42 AM

Internet retail putting "high street" company’s out of business is a global phenomenon and not exclusive to Scotland. I naïve to think that if Amazon didn't move into Scotland it would save the high street. If they were based in England the result would be the same except the Amazon jobs would be down there!

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25

son_of_hamish

Thursday, April 5, 2012 at 10:10 AM

This is SO true. The idea that these giant companies "create" jobs is laughable, it is a zero sum game just like Tesco and the supermarkets, they are like neutron bombs going off in town centers, all the buildings are still there but its dead. Go to Cupar and see the results. Alex Salmond has one thing he loves more than Scotland and that is himself, his arrogance will be his undoing.

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24

deliverus

Friday, December 9, 2011 at 12:31 AM

17Leisure_suit_Larry------so you agree that he is able to show that the SNP are creating jobs?

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23

deliverus

Friday, December 9, 2011 at 12:26 AM

19Maurice the Dolphin-------Maurice are you still with us or are you fervently googling?

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22

deliverus

Friday, December 9, 2011 at 12:14 AM

19Maurice the Dolphin---Name one!

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21

Vote 'NO'

Friday, December 9, 2011 at 12:03 AM

5 At least I live in Scotland. So my view counts, you prefer to pay your taxes to a foreign county. Begone contemptuous licksputtle.

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20

Maurice the Dolphin

Thursday, December 8, 2011 at 11:49 PM

#18 Alba_Lee:- "Can't blame Amazon for presenting a better business model."...................Especially with £10m of good Scottish money in their back pocket.

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19

Maurice the Dolphin

Thursday, December 8, 2011 at 11:48 PM

£10m of tax payers cash for some low paid temporary jobs. Amazon will follow the other companies that's been given a wad of cash by the SNP to relocate only to go ta ta in a year or so's time.

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18

Alba_Lee

Thursday, December 8, 2011 at 09:39 PM

This article is absolutely ridiculas! ------- "Spells the death of small local business" --------- The hypocracy of the wordsmith, self admitted user of Amazon. What next. ----- Close all the supermarkets cos it's killing local producers that also receive subsidies. ------ You can not attribute the death of local business to the government in the way-------------You should have been around when they invented the car, just to pen another stupid article about the death of Blacksmiths!!!!-------- You have a choice, support your local small business or not!. You have a choice as the consumer to purchase from where you want to. Can't blame Amazon for presenting a better business model. -----------

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17

Leisure_suit_Larry

Thursday, December 8, 2011 at 07:58 PM

Most of us who already knew Salmond was a lying crook had already factored in the heavily subsidized jobs scam. Of course Salmond should be promoting scientific and technical jobs and industries but can't because 1) he knows our workforces,schools and tertiary education systems are not up to the standard to compete against the Chinese,Korean's, Japanese,Germans and even the Irish, 2) coming from the "soft" sciences does not understand industry , so he continues to promote sweat shop service sector jobs since he can always rely on job "success" announcement every few months.

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16

the wallace

Thursday, December 8, 2011 at 04:00 PM

Now i know why the english think we are all whinging jocks,listening to all you jock unionists whing at everything the snp does.Youre english readers must fair chuckle.

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15

me1952

Thursday, December 8, 2011 at 02:31 PM

the most obvious problem with this article is that if Amazon werent located in Scotland, they would simply locate somewhere else in the UK and send the stuff from there. The fact that they have a Scottish base doesnt affect the damage they do to the more traditional ways of doing business the author is seeking to defend. The other issue is of course big snake against the Scottish capercaillie - big business vs little business. Mr Andrew's defence of the little guy (including himself) presumably means that he would never seek to use the power of his business against someone even smaller than he is.Heaven forfend!

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14

Heinz Doofensmirtz

Thursday, December 8, 2011 at 01:40 PM

Why would Alex Salmond want a photo with small book shop owners?? Is the writer a bit touched......

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13

samcoldstream

Thursday, December 8, 2011 at 10:25 AM

What the author fails to inform the reader is that long before Amazon arrived in Scotland: In 1988, Collins of Glasgow, one of the largest publishers in world, merged with Harper of London, and was then swallowed up by Rupert Murdoch's News Corporation. Harper Collins then acquired Nelson Publishers of Edinburgh. HarpersCollins, with 3 massive distribution centres at Bishopbriggs outside Glasgow with a combined area of 70,000 square feet publishes and sells books on a global scale with annual revenues of over £1 billion. (Source: HarpersCollins Publishers website)

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12

TheIndependentHenBroon

Thursday, December 8, 2011 at 10:03 AM

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