Nevertheless, the reality is that as long as other states continue to offer corporate enticements, Massachusetts can’t remain competitive without also doing so.īut the commonwealth should be far more judicious in handing out those carrots seeded with public money, especially in this precarious economic moment encapsulated by Wayfair’s downsizing. When it comes to justifying big business incentives with public money, we believe it’s often a questionable tactic of gambling taxpayers’ money to pick winners and losers in the market.
#Berkshire edge editorials update
That update to the status quo should compel us to update our calculus on what we can reasonably expect in return on public investments like tax breaks. We simply must acknowledge that any sea change, including the work-from-home revolution, carries both benefits and drawbacks. This isn’t an argument for or against remote work. Meanwhile, the knock-on economic impact from having a workforce collectively located downtown - workers getting lunch at downtown eateries or local contractors doing repair and renovation jobs - are impinged as well. But that means those mixed-use business incubators - important pieces of the city’s tax base - lose out on clients and therefore rent revenue. Yes, Wayfair doesn’t have to pay rent and its employees won’t have to commute to the Clock Tower Business Center. In fact, Wayfair’s downsizing announcements led to a surge in its stock price, which jumped 20 percent last week with the news that the cuts will will save the firm about $750 million a year.īut from where are those corporate savings drawn? Arguably, they at least partially eat into the communitywide economic ripples that cities like Pittsfield hope to see when a big company plants a flag there. The former perhaps realizes a bit more autonomy and skips the commute the latter gets to radically cut down on overhead like rent or property taxes, utilities and office supplies. Going remote has potential benefits for worker and employer alike. While it’s good that most of those employed by Wayfair in the Berkshires will retain their jobs, it underscores looming questions about how the work-from-home revolution will shake out in communities looking to holistically develop their economic picture and grow their tax base. The slight silver lining is that while Wayfair is eliminating 1,750 jobs companywide, most of their positions in Pittsfield are surviving at least for now - they’re just going entirely remote when the call center closes in July. The numbers in Boston are well under the target as well, and will be even more so after layoffs there are completed. Three years after its opening, the soon-shuttering Pittsfield call center has a few dozen employees. While Wayfair saw a similar pandemic-era growth spurt as its tech-based peers, reality ultimately got in the way of those goals.
Wayfair received those investment tax credits - totaling $31,350,000 to be precise - from the state’s Economic Assistance Council with the projection that the company would have 300 employees at its Pittsfield call center and add 3,000 jobs at its headquarters in Boston by last year.
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