AP NEWS

Amazon has rapidly built up an infrastructure around Twin Cities — and around the U.S.

May 26, 2018 GMT

Just three years ago, Amazon had no physical presence in Minnesota.

Then came an 855,000-square-foot fulfillment center with robots in Shakopee, along with a smaller nearby sorting center. A delivery station in Eagan. A Prime Now hub in an industrial park in Minneapolis.

And, most recently, a new and expanding tech office in the trendy North Loop.

Its growing at an incredibly fast rate based on an incredibly large amount of volume its doing, said Thomas Paulson, a Minneapolis investment analyst who has followed Amazon for more than a decade.

While the Twin Cities was not a finalist for Amazons second headquarters with up to 50,000 high-paying corporate jobs, this region has still become a magnet for the company, which now employs more than 2,300 people in Minnesota.

So have most other major metro areas around the U.S. as Amazon continues to rapidly expand its reach as it builds out an infrastructure to get closer to where consumers live and to more quickly and cheaply dispatch packages to them.

With 563,100 workers at last count, and growing at more than 60 percent a year, Amazon has surpassed companies like Minneapolis-based Target Corp., with 345,000 employees, to become one of the largest corporate U.S. employers. By 2020, Paulson estimates Amazon will have more than a million people in its ranks.

Its mind blowing, he said. I dont know how their HR is doing it.

Many of those workers labor away in one of Amazons 175 fulfillment centers worlwide such as the one in Shakopee. But the Shakopee location has the added distinction of being one of only 25 in Amazons network that has its cutting-edge robotics platform.

Welcome to MSP1, said John Russell, director of operations, expaining that Amazon names its warehouses using the code name of the nearest airport.

The facility, which opened in July 2016, is in operation around the clock with about 2,000 workers who work 10-hour shifts four days a week.

Behind a chain-link fence, thousands of circular orange robots that resemble Roomba vaccuums have millions of square feet to cruise over four floors, scurrying along the floor like mice shuffling among stacks in a library.

The aisles are full of pods nine-level shelving units stocked with coffee filters, phone chargers, and hundreds of thousands of other products Amazon customers might purchase. This center can send packages to anywhere around the U.S., but mostly does so to addresses around the upper Midwest.

When an order comes in, a robot is directed to the closest pod that has that item, lifts the whole unit slightly off the ground, and then transports it, moving about 3 miles per hour, to one of dozens of picking stations.

One of the cool things here is that just like Minneapolis, which has freeways and highways, we have high trafficked kind of roadways, said Russell.

At the picking stations, workers like Evan Collins glance up at a screen that shows a picture and description of the item and which shelf to locate it. He grabs it, scans it to verify its the right item, and places it into one of several yellow totes lined up to his right.

He hustles back and forth from pod to tote, pod to tote.

Its a good workout, said the 26-year-old Bloomington resident, adding that hes lost 40 pounds since he started the job nine months ago.

He had just moved back home after living abroad and his insurance was about to expire when he saw an ad on TV that the fulfillment center was hiring with starting wages around $15 an hour and benefits. Two days later, he was hired.

He said workers are encouraged to go as fast as they can while being safe and doing it right. The average picker, he said, handles about 400 items an hour and the team is encouraged to meet that goal.

His record? Seven hundred eighty-five, he said without blinking.

The robots are one of the many ways Amazon has brought more efficiency and speed into its network. They have also helped cut down on the amount of walking employees have to do, said Russell.

Of course, not everyone loves the idea of robots, worried they are replacing human workers. Russells response?

This technology has allowed us to create some new jobs that didnt exist before, he said. These roles are more skilled and require different levels of training.

One of those new roles, he said, are amnesty floor monitors, whose jobs it is to pick up products if they fall out of a pod. These workers use a Kindle to create a virtual pathway to get to the item to block robotics traffic along the route along the way.

Other retailers including Richfield-based Best Buy and Target are also testing way to bring more automation and robotics into their distribution centers as they look to become faster and more efficient to better compete with Amazon.

While robotics plays a big role in the building, at least four humans will still touch a package before it goes out the door.

In addition to the picking stations, there are areas where employees stock the pods full of products coming in from vendors or other Amazon facilities. Theres packing areas where workers place the items in boxes. And there are people who load the trucks.

The fulfillment center is built around optimization at every step in the process. Items are randomly stored in pods based on which ones are emptiest, not by product category. The system tells packers which box best fits a product and spits out exactly the right amount of packing tape to fit that size box.

Packages then head down a conveyor belt, are scanned through a tunnel, and are diverted to the appropriate chute and loading dock based on where theyre headed to next.

Some trucks head to Amazons sorting center a few miles away where packages are separated by ZIP code and then to the closest Postal Service office to help speed up deliveries. Same-day delivery orders head to the delivery station in Eagan from which packages are sent out in vans to customers doorsteps.

Amazons deliveries within an hour or two are handled from the Prime Now hub in Minneapolis where contract drivers similar to the arrangement with Uber and Lyft stream in and out to pick up orders.

Meanwhile in the North Loop, Amazon has about 150 tech workers working on new transportation technology, delivery services, and its fast-growing cloud-computing division. The company said a few weeks ago that it will add an additional 200 jobs there. That same week, Amazon also announced it would add thousands of additional jobs at its tech hubs in Boston and Vancouver.

Thats on top of the 45,000 corporate jobs Amazon already has at its Seattle headquarters and up to 50,000 more coming to the city that lands its second corporate campus.

Kavita Kumar 612-673-4113