Amazon will invest $4 billion by 2026 to expand its network in rural America for delivering packages faster in densely populated areas, the company said in an April 30 statement.
“This investment will also grow our rural delivery network’s footprint to over 200 delivery stations, and we estimate it will create over 100,000 new jobs and driving opportunities through a wide range of full-time, part-time, and flexible positions in our buildings and on the roads,” the company said.
“Once this expansion is complete, our network will be able to deliver over a billion more packages each year to customers living in over 13,000 zip codes spanning 1,200,000 square miles—an area the size of Alaska, California, and Texas combined.”
The effort focuses on small towns in the United States. Amazon plans on expanding at a time when many logistics providers “have backed away from investing in rural customers and communities.”
Amazon estimates that by the end of next year, its rural delivery network will triple in size, with average delivery times being cut in half.
For each new facility opened as part of expansion, an estimated 170 new jobs on average shall be created at the delivery station level, Amazon said, adding that other job opportunities would be extra, such as those created via the Delivery Service Partner (DSP) and Amazon Flex programs.
DSP is a program in which small businesses set up delivery services to transport Amazon goods. Flex is aimed at individuals who want to make some extra money delivering Amazon packages using their own vehicles.
The flex program has been caught up in legal conflicts involving driver contracts.
In June last year, lawyers representing thousands of Amazon Flex drivers announced they filed legal claims alleging the company wrongly classified the drivers as independent contractors rather than employees, which led to them being deprived of various financial benefits and worker protections.
“As Amazon exerts considerable control over the Flex drivers in their deliveries and the deliveries are part of Amazon’s usual business, the drivers qualify as Amazon employees, not independent contractors, and should be paid accordingly,” Joseph Sellers, partner at Cohen Milstein Sellers & Toll PLLC and attorney for the drivers, said at the time.
