NJ becoming the warehouse state, and that means more jobs
After she clicks buy, a team of machines and workers at warehouses across the nation go into action to fulfill her order, pulling the item off of racks, dropping it in a box and shipping it out. More and more, e-commerce companies are locating those workers here in New Jersey.
The Garden State is on its way to becoming the Warehouse State.
While it's not secret that the internet has changed the way we shop, it's changing where we work. It's transforming New Jersey's workforce.
Companies, such as retail giant Amazon, are employing thousands of workers, in some cases 24 hours a day, to process and send all those e-commerce orders. One of the biggest warehouses is off Interstate 195 near Allentown. Hundreds of people recently lined up to try to get a job there. Watch the video at the top of this story to learn about the job fair.
People still work at stores, which continue to be the place where people shop and buy. Shoppers still to go to retailers to try on clothes or to a supermarket to eyeball the produce.
But things are shifting.
While the internet fueled 8.3 percent of retail sales in 2016, it accounted for 25 percent of spending on apparel, said James W. Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University. It represented 66 percent of books, film and music sales and 33 percent of consumer electronics sales.
It has caused large retailers, such as Macy's, to close some stores while boosting their online business to cope with changing consumer habits.
Retailers are leasing warehouses near the New Jersey Turnpike and in towns like Edison, Perth Amboy and Carteret and installing racks that stack merchandise to the ceiling. One Amazon warehouse in Robbinsville off of the Turnpike's Exit 7A is more than 1 million square feet. That's about the size of 28 football fields.
More than 450,000 people work in New Jersey's transportation, logistics and distribution industries, including e-commerce fulfillment centers, estimated Anne Strauss-Wieder, director of freight planning for the North Jersey Transportation Planning Authority.
For instance, Amazon has more than 13,000 full-time employees in New Jersey, putting it on a path to become one of the state's largest employers, said Michele Siekerka, president and chief executive officer of the New Jersey Business and Industry Association. More than 4,000 work in Robbinsville now and Amazon is opening warehouses this fall in Edison, Logan and Cranbury, and in Teterboro in 2018.
Figures that detail e-commerce employment in New Jersey are hard to come by, but percentagegrowth in the state's warehouse jobs is outpacing retail.
As of the end of 2016, growth in overall warehouse and storage employment was five times higher than growth in retail jobs. It has grown by 20.8 percent since 2011, while retail has grown by just 4.16 percent, according to figures compiled by the state Department of Labor and Workforce Development.
And these e-commerce jobs may require more technical skills so they can bring higher wages than traditional retail jobs, Siekerka said. It's not just merchandise pickers, but information technology, human resources, and office stafffers too.
"It used to be when we went to the mall, that's where the workers were," Strauss-Wieder said. "Now we also have a lot of workforce going to different locations in the supply chain."
Old Bridge resident Anthony Caputo stopped by Amazon's job fair earlier this August. The company sought to hire 1,500 people in New Jersey to pick, pack and ship orders.
"It's 2017. This is the way of the future," Caputo said of the prospect of working for Amazon. "You can see the future in this job."
New Jersey has turned into an e-commerce powerhouse.
The market for warehouse space is booming. Thirteen counties in north and central Jersey have about 811 million square feet of industrial space, with 21 million square feet added since 2008 and the Great Recession, Strauss-Weider said.
There are over a billion square feet of warehouses statewide, including properties geared towards e-commerce, she added. It puts New Jersey's concentration third behind Southern California and the Chicago area.
Another 9 million square feet is under construction right now, Strauss said. The vast demand for new industrial space is for e-commerce operations, the planning authority said.
"With all this additional square footage and the move towards e-commerce in our region, we estimate that the workforce in industrial buildings in our area has nearly doubled since 1998," said David Behrend, an NJTPA spokesman.
These warehouses are concentrated along the New Jersey Turnpike's exits 7A and 8A. But now they're being built in places like Edison, Piscataway, Carteret and South Brunswick. "The buildings are going up and they are being leased at a very quick rate," said Chuck Fern, executive managing director at Cushman & Wakefield, a commercial real estate brokerage in Iselin. "The supply is not keeping up with the demand right now."
You can just look at the numbers. According to Cushman & Wakefield, the vacancy rate for industrial space in Northern and Central Jersey was 4.5 percent in the second quarter, down from 5 percent in the second quarter of 2016. Asking rents are up.
Besides Amazon, Target has leased a large warehouse in Perth Amboy for its e-commerce business. Online retailer Wayfair has a 1.2-million-square-foot facility in Cranbury. Meal prep company Blue Apron opened a 495,000-square-foot fulfillment center in Linden, the site of the former General Motors plant, earlier this year. It expects to have 2,000 people working there.
In the Meadowlands, companies are using older and smaller warehouses to meet customer demand for same-day or overnight delivery. LIke other parts of the state, vacancy rates are low. "We are basically the distribution center for Manhattan, for New York and northern New Jersey," said Bill Hanson, president of NAI James E. Hanson, a commercial real estate brokerage and property management firm in Hackensack.
It's all for customers like Manalapan resident Jenna Ricciardi.
Sometimes she picks same-day delivery and her items arrive in the evening by van.
"It is not easy to go to the store just to go pick up something like diapers. It's not worth the effort," said Ricciardi, a mother of two. "I can do it from my phone. I don't even have to go to the computer."
Red Bank resident Tom Musumeci uses his smartphone to shop online. "I can go to Amazon right on my phone. I can go to Kohl's right on my phone." Free shipping will have his purchase at his home a couple of days later. "It's a timesaver; it's a money saver, in some cases; and it's convenient," said Musumeci, president of MWM Financial LLC in West Long Branch.
Why New Jersey? It's where their customers live. And there's a big pool of available employees to fill the jobs.
New Jersey, the densest state by population in the country, is located just across from New York City, and at one of the largest ports in the United States. It's also next to other big consumer markets in Pennsylvania and Connecticut.
"Location, location and location," Siekerka said. "One of the driving industries in New Jersey right now is logistics and distribution."
New Jersey also has a complex road system to get goods to homes. The Turnpike moves trucks north and south and connects with interstates 78, 80 and 195, major east and west corridors.
"The infrastructure is really well suited for transit," said David Thurston, first vice president of investment at Marcus & Millichap, a real estate consulting firm. Developers also are building warehouses close to other highways, such as Interstate 287.
"The most important factor is certainly being as close to our customers as possible," said Nina Lindsey, an Amazon spokeswoman.