Amazon’s HQ2 hiring falls short of 2024 target

When Amazon.com picked Arlington County as the site of its second headquarters (HQ2) in 2018, the online behemoth said it expected to create 25,000 jobs by 2030.

However, in an April 1 application requesting payment of taxpayer-funded incentives from the state, Amazon checked the “moderate” box as a reflection of its confidence that it would meet the job target by 2038.

In every previous application filed with the state, Amazon checked the “high” confidence box.

“Amazon is proud of the progress we’ve made since first announcing Arlington as the site for HQ2, and that we’ve reached nearly 30% of our hiring goal to date,” Holly Sullivan, vice president of worldwide economic development for Amazon, said in a statement. “From boosting local jobs and small businesses, to expanding affordable housing and supporting Virginia nonprofits, transit and community projects, we are proud to call the Virginia home and to continue being a great neighbor.”

In the application, Sullivan stated, “Our second headquarters has always been and continues to be a long-term investment, and we are proud of the progress we have made.”

The application also notes that since 2018, Amazon has made more than $2.5 billion in capital investment at the HQ2 headquarters.

But things have changed since 2018, including the pandemic’s effect on work-from-home habits and the White House’s plans to lay off federal workers and sell off federal buildings around the region. In 2023, Amazon said it would delay construction on the second phase of HQ2 shortly before the opening of its first phase.

When the state first celebrated being picked for HQ2, economic development experts forecast that the project would help Northern Virginia diversify its economy, which is heavily reliant on the federal government. More than 175,000 federal workers lived in Northern Virginia in 2023, according to the Northern Virginia Regional Commission. Amazon’s HQ2 jobs were expected to be high paying and competitive.

Reducing reliance on the federal government is especially key today as President Donald Trump works to achieve his “commitment to reducing the size and scope of the federal government,” and has laid off or fired at least 121,000 federal workers in the first 100 days of his second term, according to a CNN analysis.

Having Amazon — and other tech companies expected to follow — to insulate the Northern Virginia economy from the vagaries of federal employment doesn’t work as well if the retailer is also impacted by federal actions, points out Terry Clower, professor of public policy at George Mason University’s Schar School of Policy and Government.

“The unfortunate piece is that the reduction in federal workforce is happening at the same time that the Trump administration is shocking the entire ecosystem of jobs,” he said Monday. “Everything is very much uncertain now, with all with the trade policies, the broader impacts of cutbacks in federal spending, because Amazon gets federal spending like a lot of other companies.”

Incremental job growth

In its application, Amazon requests more than $6.4 million from Virginia’s Major Headquarters Workforce Grant Payment, a grant that pays out $22,000 per qualifying job. The average annual wage paid for these positions is above the wage target specified in the agreement of $161,593.

Last year, Amazon hired 293 incentive-qualifying employees, according to the application.

“We appreciate every job we can get, but it wasn’t very much in the last year,” Clower said of HQ2’s 2024 number.

From 2018 through the end of 2024, Amazon hired 7,232 incentive-qualifying employees at HQ2, falling short of the 10,000 qualifying workers it had targeted to hire by 2024.

“While we experienced incremental new job growth in 2024, we exceeded hiring goals in previous years,” Sullivan stated in the document.

Amazon has hit other roadblocks with HQ2. In 2023, the company paused construction on HQ2’s second phase, PenPlace, which was set to include 3.3 million square feet of office and retail space spread across three 22-story buildings. In that application to the state, Amazon revealed that the company had lost 295 incentive-qualifying positions since 2022.

Also in 2023, Amazon officially opened Metropolitan Park, the first phase of HQ2. The development includes 2-million-plus square feet of commercial space, including 50,000 square feet of retail space for local, small businesses, according to Amazon.

Since 2010, Amazon has invested more than $135 billion in the commonwealth, in infrastructure and paychecks for employees, Sullivan stated in the application.

“We’ve also created 42,000 full- and part-time jobs in Virginia (as of January 2024), supported nearly 200,000 indirect jobs on top of our direct hires in the state, and $96 billion has been added into the state GDP as a result of Amazon’s investments,” she wrote.