How Rust Belt Corporate Cities Are Changing in the Age of E-Commerce

Bethlehem Steel casts a long shadow over Pennsylvania’s Lehigh Valley. The blast furnaces remain, even if they were silent more than 20 years ago. The plant’s closure took with it much of the area’s high-paying blue-collar jobs, and news at the time made it seem very definitive.

But at the time, no one was considering e-commerce.

The demand for next-day or even same-day delivery has posed huge challenges in physical store markets, but it has also created demand in huge, job-hungry fulfillment centers. Don Cunningham, President and CEO of the Lehigh Valley Economic Development Corporation, said, “When people log into their iPhones and order every product imaginable to show up at their doorstep, they don’t are not brought there by magic. It takes, quite frankly, an army of people to do that.”

Today, there are almost as many warehouse jobs in the area as there are manufacturing positions. It’s a big step, Cunningham told correspondent Lee Cowan: “From a purely economic standpoint, for workers with a high school education or less, it’s created something that, quite frankly, didn’t exist in this field since the days of cement factories and slate quarries and steelworks.”

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Many manufacturing jobs in Rust Belt communities have been replaced by warehouse order fulfillment jobs for online retailers.

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Nationally, Amazon alone has created more than 500,000 jobs since 2020, making it the second largest private employer in the country, just behind Walmart.

Most e-commerce warehouses also offer benefits and wages of up to $20 an hour, effectively making it minimum wage, at least here.

“We say, anyone who wants a job, there’s a job for you in this industry,” said Susan Larkin, vice president of Allied Personnel Services. That said, Larkin warns that while the money can be good, warehouse work can also be quite grueling. Employers, she says, are looking for “warehouse athletes.”

“Is that a term? Warehouse athlete? asked Cowan.

“It’s a term they consider ‘warehouse athletes’ of their employees. So, you know, stepping into this role, it’s going to be physical work.”

Long hours with often rigid quotas lead to a fairly high turnover rate in these jobs. But shortening supply chains is now the name of the game, with nearly every retailer competing for warehouse space across the country to fuel their own online sales.

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Home Depot is just one of many companies that maintain massive distribution centers in the Lehigh Valley.

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Adrian Ponsen, who analyzes industrial real estate for CoStar, says that in total nearly two billion square feet of new warehouses have been built in this country in the past five years. “That equates to about 33,000 football pitches of distribution centers,” he said. “You can see, places like Dallas, Inland Empire in Southern California, Chicago and Atlanta, we’re seeing record spending. A recent Amazon facility that was built on the site of a former assembly plant GM in Wilmington, Delaware is the largest commercial structure that has ever been built in Delaware.”

In the Lehigh Valley, County Executive Lamont McClure is fighting back. “We are at an inflection point,” he said.

McClure worries that the rural character of the area is now under threat. “We admire the people who work hard in these warehouses, and we don’t want their jobs to go away. What we’re saying is we don’t need them anymore,” he said. “Had finished.”

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With the expansion of commercial real estate, the rural character of the Lehigh Valley is threatened.

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He knows he can’t compete with the deep pockets of a UPS or a Target, both of which have a big footprint here, but he still tries. McClure has spent $12 million of county money over the past four years to buy tracts of farmland to save them from warehouse development and, in doing so, he hopes, will also help clean up the ‘air.

“It’s dangerous and scary,” McClure told Cowan. “And our people are just tired of the truck traffic.”

“And noise!

“Yes. But there is a lot of air pollution in the Lehigh Valley.”

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Lehigh Valley County Executive Lamont McClure with correspondent Lee Cowan.

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Trucks often take Main Street – a two-lane road through historic downtown Bethlehem – to get to a nearby highway. Breena Holland, an associate professor at Lehigh University, measured the amount of black carbon particles in the exhaust of passing trucks. And here, she says, it’s particularly concentrated.

She showed Cowan a reading of traffic emissions: “This spike here is just from this big white 18-wheeler that just passed,” she said.

“What we’re trying to do is measure episodic exposures at the lung level – what people are exposed to on the street when trucks drive by,” she said.

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Lehigh University professor Breena Holland monitors air pollution levels on Main Street in Bethlemen, Pennsylvania.

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Yet with any increase in traffic comes an increase in jobs. The Lehigh Valley is one of the few areas in the Rust Belt that has actually increased, rather than decreased. For Don Cunningham of the Lehigh Valley Economic Development Corporation, it’s a victory. But this region knows perhaps better than anywhere that even the best boomers…usually have a bust.

“Life is evolution, and economies are evolution,” Cunningham said. “And I think anyone who builds an economy thinking it will be that way forever is a bit of a fool. Things are constantly changing.”

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Don Cunningham of the Lehigh Valley Economic Development Corporation with Lee Cowan at the former Bethlehem Steel site, which did not survive the 20th century.

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Story produced by Mark Hudspeth. Publisher: Ed Givnish.

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