Business & Economy

Amazon tells Minnesota it will shut down Shakopee center, lay off 680 workers

A logo on a building.
The Shakopee center closure will be permanent at the end of May this year.
Angela Weiss | AFP via Getty Images 2020

Updated Jan. 31, 1:30 p.m.

Retail giant Amazon told state officials Monday it will shut down a sort center complex in Shakopee and lay off 680 employees at the facilities, effective March 31.

In a letter to the Minnesota Department of Employment and Economic Development, the company made it clear the closure would be permanent. A company spokesperson later told MPR News the workers affected will be offered opportunities at facilities elsewhere in the Twin Cities region and that this move was not about reducing headcounts.

“We’re always evaluating our network to make sure it fits our business needs and to improve the experience for our employees, customers, partners, and drivers,” said Steve Kelly, public relations manager. “As part of that effort, we may close older sites, enhance existing facilities, or open new sites, and we weigh a variety of factors when deciding where to develop future sites or maintain a presence.

This is not the larger facility many think of in Shakopee, known as MSP1. Amazon said the facility that is shutting is a rented space and the lease is expiring.

Amazon said it made the announcement per state and federal laws that require companies to give governments advance notice of large layoffs.

Workers at Amazon's fulfillment center have held walkouts and demonstrations in recent years asking for improved working conditions and exploring unionization efforts. Kelly said the closure of the nearby sort center had nothing to do with those factors.

In the spring, the upstart Amazon Labor Union won the right to represent some 8,000 workers at the massive New York warehouse.

Safia Ibrahim said she has worked at the closing MSP5 facility for seven years, most recently as a scanner. Ibrahim said she has not heard of any organized efforts to unionize at her location, and she liked working at the facility, despite dealing with some "bad managers" in the past.

"The first job I started in the United States was here with Amazon," Ibrahim said. "I don't like to be missing my job, it is like my home."

Ibrahim said she is speaking out for many of the other East African and Somali women she works with at the facility.

"I can't afford to go somewhere far away," Ibrahim added.

Amazon has said it will offer the affected employees positions at other facilities across the Twin Cities metro area. Ibrahim said she still does not know where she will be offered another position or what it would be, but she is hoping they will work with the individual needs of workers to find compatible jobs and locations.

Ibrahim added she and other workers have helped the company expand across Minnesota, and she wants Amazon to see the value of their contributions.

Amazon has not shared how many employees will be staying on with the company.

In response to Monday’s news, U.S. Rep. Angie Craig — whose district includes Shakopee — issued a statement Tuesday saying she’s “disappointed” with Amazon’s decision.

“I have reached out to Amazon to let them know that I will do everything in my power as a member of Congress to ensure they keep their word about finding new jobs for these individuals where possible in Shakopee as well as the broader Twin Cities area,” Craig said.

She said she planned to follow up with Amazon for updates on how many employees were able to be transferred to new jobs, their pay at those new jobs, and the severance provided to any employees not retained.