Distribution Center Growth and Positive Impact

The growth of eCommerce has driven the demand for distribution centers (DCs) in recent years. This can provide many benefits to communities with distribution centers, including job growth, revenue generation through increased tax income, road and infrastructure developments, utilizing vacant buildings or land, and other positive impacts.

As more distribution center locations open, the demand for workers is increasing, which is resulting in increased wage levels and benefits.

Logistics-related employment registered its largest increase ever in the first quarter of 2018 with wages growing 3.9 percent, nearly 1.5 times that of all civilian workers according to Bureau of Labor Statistics Employee Cost Index.

Distribution centers provide a meaningful career path, which includes training and work with automation, robotics, 3D printing, IOT, drones and other technical job skills.

The income and property taxes generated by industrial buildings can help local budgets. Centers with more automation generate higher levels of investment and increased assessed value, which positively impact local budgets and schools.

Large DC’s associated with well-known companies may help build a community’s resume. This can lend validity to the community and may attract other companies that support the distribution center operations and its employees.

Distribution centers can also lead to community improvements, such as road improvements and neighborhood revitalization. Distribution Centers generally go along with additional growth needed to support community transportation infrastructures.

Additionally, eCommerce and distribution operations may choose to occupy empty buildings which can help repurpose these structures.  A variety of locations that are currently underused can be adapted to some type of e-commerce function likely to offer high levels of employment.

An example of the positive impact at a local level is the Logistics Park Kansas City (LPKC) in Edgerton, Kansas. In the last 7 years, LPKC has built and leased 13 million square feet of industrial space. This has led to the creation of 4,500 jobs, $1.1 billion of private investment and a 422% increase in tax revenues for the City of Edgerton.

With this substantial increase in tax revenue, the City of Edgerton has made significant strides in improving public infrastructure and revitalizing neighborhoods, including a commitment to improve every single street in the city. The city is currently planning a new community event space/facility that will be open to the public, in addition to a new park that opened earlier this year and more. These types of improvements and growth in the City of Edgerton, KS would not have been possible without the development of Logistics Park KC.

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