Apple has picked Austin as the site of its new $1 billion campus, one that will ultimately have 15,000 employees. The Verge has the initial details:
Along with the 6,200 employees that Apple already has in the city, its new 133-acre development is expected to make it the largest private employer in Austin. Apple expects the new campus to accommodate 5,000 employees at first, though it will ultimately have a total capacity of 15,000. The new Austin campus will handle tasks ranging from engineering to customer support for the company. Like all Apple’s other facilities worldwide, the facility will run on 100 percent renewable energy.
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Along with its new Austin campus, Apple has also announced expansions across a number of other US cities. Seattle, San Diego, and Culver City will each grow to have over 1,000 employees apiece, and Apple also plans to expand its operations in Pittsburgh, New York, and Boulder, Colorado, over the next three years. In total, Apple employs 90,000 people across the US, and has over 1,000 employees per state across 16 states.
Once again we see a major tech company going with the “usual suspects.” Austin is not a superstar city, but is a booming Sunbelt city with a longstanding tech cluster. Apple picking Austin may help explain how Amazon ended up in Nashville over Austin.
The other places Amazon is going to are all already on the list so to speak. This map from Verge says it all about how things are playing out in American tech:
The Dallas-Fort Worth metropolitan area (DFW) will be the new headquarters of McKesson, the nation’s largest pharmaceutical distributor, the company announced this week. DFW will now have three of the top 10 companies in the Fortune 500 (ranked by total revenue). No other metropolitan area has more than one of the top 10. Dallas-Fort Worth is also home to Exxon-Mobil, the second largest company and AT&T, ranked ninth.
This continues the high-profile exodus of companies from California, with its high cost of living and Chief Executive Magazine ranking as the worst state for business. Not surprisingly, McKesson chose the state ranked as best for business, Texas.
With news that GM is closing its Lordstown assembly plant near Youngstown, I thought back to a short film I saw in grade school that made such an impression on me at the time that I never forgot it. In the wake of a strike at the plant in 1972, film makers interviewed workers at the plant and created a short documentary from it. Note at the scenes inside the plant are not from Lordstown. In fact, I think they are from a Ford plant. GM refused to cooperate with the film crew in any way, so they used other footage to give a look at life inside the plant in that era. If the video player doesn’t display for you, click over to watch on YouTube.
Another GM plant that’s closing is the one in Detroit’s former Poletown neighborhood. Steve Malanga at City Journal takes a look back at the senseless destruction of a city neighborhood carried out to build this plant that will now just become another hulking ruin in Detroit.
Maine governor Paul LePage has announced that he will move to Florida after his term expires in 2019. According to The Hill, taxes are driving the Governor away. He said: “I will pay no income tax and the house in Florida’s property taxes are $2,000 less than we were paying in Boothbay,” LePage said. “At my age, why wouldn’t you conserve your resources and spend it on family [rather] than spend it on taxes?”
According to the Wall Street Journal, New York Governor Andrew Cuomo said that young people are returning "to upstate cities such as Buffalo." The Governor continued, “This is reality, these are numbers.” Cuomo was quoted in a 27 September article on the population and economic stagnation in New York. Actually, the latest American Community Survey domestic migration data for the Buffalo metropolitan area, there was net outmigration in 2011-2015. The rate of net loss was nearly double the metropolitan area loss rate among those aged 20 to 24, and more than triple the metropolitan rate among those aged 25 to 34. That is the reality, at least according to data developed by the US Census Bureau.
After years of substantially increasing numbers, working at home has now exceeded transit as an employment access mode. In 2017, 8 million people worked at home, compared to 7.6 million riding transit in the U.S. Since 2010, the share of workers at home has risen 21 percent, compared to transit’s 1 percent rise. More details will follow on newgeography.com shortly.
The Nikkei Asian Review reports that: “A high-speed rail line connecting Seoul to Incheon International Airport will be abolished after just four years of service, as the expensive, politically motivated project loses the ridership race to buses.” Incheon is the principal international airport for the world’s fourth largest urban area, Seoul, which has 24 million residents. The Review reported that “Average daily ridership last year totaled only 3,433 passengers, which left 77% of seats unoccupied. Carriages were especially empty during weekday hours.”
The Review contrasted this with the airport volume: “Yet 42.23 million passengers boarded international flights during the first half of 2018, up 14% on the year, transport ministry data shows. … These numbers indicate that air passengers simply did not choose KTX to reach the Seoul-area airport.”
The line had fallen 97 percent short of its projected ridership, according to The Korea Times, which reported that daily ridership was to have reached 490,000 by 2010, yet was only 16,000 last year. This may have been the highest projection error in the history of an industry plagued by such inaccuracies (see: High-Speed Rail: Toward Least-Worst Projections).
The Sunday Times (London) reports that it has obtained a secret Cabinet report indicating that “The HS2 high-speed rail project is “highly likely” to go as much as 60% over budget and cost “more than £80 billion.” HS2 refers to the high speed rail project intended to link London to Birmingham, Manchester, Leeds and the East Midlands. According to The Sunday Times the government’s Infrastructure and Projects Authority (IPA) called the plan “fundamentally flawed” and in a “precarious position.” Further, according to The Sunday Times, "cost escalation in the £56bn project could threaten wider public spending, interfering with funding across other government departments.”
The Cabinet report comes just weeks after release of a report by the European Union Court of Auditors. Particularly relevant to the HS2 are the Court's findings that EU high speed rail projects have been overbuilt. As we reported, “The European Court of Auditors found that high-speed rail has been built to considerably higher standards than required by their actual operation. They concluded that average speed are so far below the design speed that it 'raises questions as to sound financial management." The Court further found that: “The costs involved could in fact have been far lower, with little or no impact on operations.”
Coincidentally, The Sunday Times indicates that many members of Parliament would favor improvements to the conventional rail service in the corridor, which would obviously cost much less.
The Economist provides a useful perspective on the continuing decline of mass transit ridership in its current number. It starts with relating how Juana, a Guatemalan immigrant to Los Angeles, no longer takes the bus and now drives everywhere. She told The Economist that she had "two aspirations, to learn English and get a car," which she did.
I heard a similar story a decade ago from a Gabonese student in Paris, who said that he needed a car "so that he could have feet."
The Economist shows that the broad ridership decline occurring in US metropolitan areas (see graph) is also occurring in some of international cities, like London and Madrid.
The Economist cites more liberal car loans, working at home and ride hailing services, like Uber and Lyft.
Juana's story is typical. For the most part mass transit is not competitive with cars. The average employee in the New York metropolitan area (with the most extensive mass transit system in the United States) can reach 13 times as many jobs in 30 minutes by car as by mass transit. In some US cities, the car reaches at least 100 times as many jobs. There is no conceivable level of public spending that can materially change that.
The car enriches lives in ways that mass transit cannot, by making millions of additional jobs accessible, by increasing shopping opportunities and by vastly expanding the potential for leisure and recreational travel. The reality is that when people can afford cars, they buy them.
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