Milwaukee among contending cities for second Amazon headquarters

MILWAUKEE (CBS 58) -- Amazon's surprise announcement Thursday that it plans to look for a second corporate headquarters in North America is likely to set off a bidding war among cities and municipalities, eager for a bite at the $38 billion in economic growth potential the company has promised with a second HQ.

The company gave some clues about what it wants for its cheekily named "HQ2" -- a location similar to its Seattle campus that is urban or suburban, well-connected to transit and in a metro area with at least 1 million people. But beyond that, the fact that it's going through a public process and accepting bids suggest it's open to looking far and wide -- and willing to be swayed by generous state and municipal tax breaks whipped up by local governments.

"It's unusual to go through a [request for proprosal] process, essentially shopping for a new location before any vetting is done on their own for a new location," said Dennis Donovan, president of WDG Consulting, a location search company.

The U.S. has 55 metro areas with a population over 1 million. Excluding Seattle itself and cities in Puerto Rico (an unlikely choice considering the U.S. territory's fiscal issues and legal status), that leaves 53.

Though Amazon specified a city larger than 1 million, most experts predict the behemoth will need a much larger metropolitan area.

"Amazon is so large that it itself is a place-maker and a place-changer," said Susan Wachter, co-director of the Penn Institute for Urban Research at the University of Pennsylvania. "It cannot put itself down in the middle of nowhere because it would overwhelm whatever was there."

That leaves out college towns like State College, Pennsylvania, or Ann Arbor, Michigan, where more than half of the population is college-educated but which lack proximity to major metro centers, along with their infrastructure. 

"Amazon is a prototypical innovation economy company. It relies on a lot of workers with a lot of technical training," said Joseph Parilla, a fellow in the Metropolitan Policy program at the Brookings Institute. "We're looking at a combination of factors that might make an attractive labor market, like the quantity and quality of the college-educated force."

Among the many factors Amazon listed, that's the one that weighs above all others: talent. All the experts who spoke with CBS News for this story said the size and quality of the potential workforce would be a big factor for the project's location, which promises to hire 50,000 people at six-figure salaries. 

That also means the places Amazon already has fulfillment centers won't necessarily have an advantage because those centers tend to employ hourly workers with lower-skilled people.

A third of U.S. adults have a bachelor's degree, so to find relatively high-educated cities, CBS News looked at metro areas where more than 33 percent of the population has a college degree or higher.

Twenty-six cities fit this criteria:

Metro area	State	Population	Percent with bachelor's degree
New York-Newark-Jersey City	NY	20,153,634	38.40
Los Angeles-Long Beach-Anaheim	CA	13,310,447	32.70
Chicago-Naperville-Elgin	IL	9,512,999	36.00
Dallas-Fort Worth-Arlington	TX	7,233,323	33.40
Washington-Arlington-Alexandria	DC	6,131,977	49.30
Philadelphia-Camden-Wilmington	PA	6,070,500	36.00
Atlanta-Sandy Springs-Roswell	GA	5,789,700	37.00
Boston-Cambridge-Newton	MA	4,794,447	46.00
San Francisco-Oakland-Hayward	CA	4,679,166	47.20
Minneapolis-St. Paul-Bloomington	MN	3,551,036	40.30
San Diego-Carlsbad	CA	3,317,749	37.20
Denver-Aurora-Lakewood	CO	2,853,077	41.80
Baltimore-Columbia-Towson	MD	2,798,886	38.60
Charlotte-Concord-Gastonia	NC	2,474,314	33.50
Portland-Vancouver-Hillsboro	OR	2,424,955	37.90
Pittsburgh	PA	2,342,299	33.00
Kansas City	MO	2,104,509	35.80
Austin-Round Rock	TX	2,056,405	42.60
Columbus	OH	2,041,520	35.10
San Jose-Sunnyvale-Santa Clara	CA	1,978,816	48.70
Nashville-Davidson--Murfreesboro--Franklin	TN	1,865,298	33.60
Milwaukee-Waukesha-West Allis	WI	1,572,482	33.90
Raleigh	NC	1,302,946	44.40
Richmond	VA	1,281,708	35.20
Hartford-West Hartford-East Hartford	CT	1,206,836	38.30
Rochester	NY	1,078,879	37.30

One thing that likely won't have much of an impact? The subsidies that the state or city offers, experts said -- although tax breaks might make a difference if two top-tier cities competed that were otherwise very similar.

"I often tell my clients that all the incentives in the world won't make the wrong location right," said Bruce Maus, a logistical consultant.

Wisconsin Economic Development Corporation public affairs and communications director Mark Maley released this statement about the economic stature of Wisconsin:

Under Governor Walker, the state has turned around its economy, cut taxes by more than $4.7 billion and implemented numerous pro-business policies that have resulted in Wisconsin being ranked in the Top 10 of “Best Places to Do Business.” These initiatives, coupled with our dedicated workforce, outstanding education system and reliable infrastructure, have put Wisconsin on the radar screen of major corporations from around the world as they seek to expand their operations.

As companies such as Foxconn and Haribo have discovered, there are many great reasons for establishing operations in Wisconsin. WEDC does not comment on potential or pending economic development opportunities.