The Amazon Effect: A Packaging Boom—and Waste

How those ubiquitous boxes boost jobs and consumer waste.

Posted Apr 03, 2019

Amazon. It’s become a one-stop, one-click shop for everything from apps to watches and all the letters of the alphabet in-between. The firm has become a by-word for ease and efficiency. For many, it represents the likely eventual death of the shopping mall and a greener future as we cease treating cars as essential for suburban customers to do their thing.

Of course, Amazon began as an online delivery service for books. It quickly became a vast, if largely invisible, warehouse and postal service. And the company’s early history in paper—seemingly a dying industry—remains relevant. For while you may not be purchasing printed books from the business, if you buy other goods, they arrive packaged in paper. That has a big economic and environmental impact.

A recent article in The New York Times tells the story of a Wisconsin paper mill that was shuttered in 2017 but reopened this year to meet the rising demand for cardboard from electronic retailers, led by Amazon. The so-called Amazon effect has been credited with providing life-support to a declining industry—a third of Wisconsin’s paper mills have closed over the past two decades. Cheaper foreign products, primarily from China, and a strong dollar are said to be largely responsible for the sector’s decline in the US, along with digital media consumption, which has partially displaced commercial printing and other paper-based communication.

Demand for corrugated cardboard boxes for packaging isn’t the only bright spot for an otherwise shrinking industry whose revenues are projected to decline by 2.5 percent annually for the foreseeable future. Paper tissue and towel products remain a bulwark against complete disaster. “You can’t take your iPad and blow your nose in it,” as one Wisconsin paper executive noted with easygoing mid-western irony.

The “Amazoning” of the retail business should not surprise anyone who has been startled by the proliferation of delivery boxes and the accompanying task of dealing with their disposal—you hope in the recycling bin, but be ready to be disappointed. Still, it’s good news for workers in the paper sector, where employment has declined by 58 percent since the downturn in 1995.

On parallel tracks of growth since the mid-1990s, the fates of e-commerce and corrugator plant production have finally merged. The volume of corrugated cardboard production has doubled since 1997, the year Amazon became a publicly-traded company. Today, Amazon accounts for 49 percent of the e-commerce market in the US, followed by eBay, Apple, Walmart, and Home Depot, which together hold about 16 percent. All of them have helped boost demand for corrugated cardboard packaging.   

In fact, over “95 percent of all products in the United States are shipped in corrugated boxes.” Though the data aren’t entirely clear, Amazon reportedly shipped 5 billion items via its Prime membership worldwide in 2017, with the most recent figures suggesting that over 600 million US deliveries are in corrugated boxes, which amounts to about 1.6 million packages a day.

The opacity of the evidence makes it difficult to measure the actual scale of the Amazon effect on paper mill production in the US. But one thing is clear: E-retailers are contributing to an increase in brown paper waste, with mixed results for cardboard recycling. Since the late 1990s, the rate of recycling corrugated cardboard boxes has grown steadily, reaching a 93 percent recovery rate in 2015. A report by USA Today notes this was largely due to grocery and big-box retail companies that routinely repackage cardboard waste for sale to paper pulpers.

But last year there was a decline of about 300,000 tons in cardboard waste sent for recycling. USA Today suggests this trend results from shifting the recycling burden onto the customers of Amazon and other e-retailers. Consumers only send a quarter of cardboard for salvage, a low number that is attributed to the fact that 40 percent of Americans lack access to or interest in curbside recycling (many think it’s an avoidable inconvenience). Another pressure point has been China’s ban on imported waste. Beijing has set very stringent standards on contaminated cardboard waste (think greasy pizza boxes as a vivid example of forbidden waste imports).

Despite this, cardboard waste recycling has been a success story in the US, with routines and markets in place that promise a 100 percent rate of recovery. But trends in the e-commerce business and persistent consumer resistance to recycling make that goal harder to achieve.

First, there has been a move by Amazon and other e-retailers to use new plastic sacks for delivery to save on transportation costs (they’re less bulky, so merchants can pack more into each delivery). This might help e-retailers improve their bottom line, but it’s a further disincentive to consumer recycling. For while the plastic sacks can be recycled, they require a trip to a special recycling location because they’re not eligible for curbside collection.

That leaves consumers who have become addicted to two-day delivery with few green options. We can shop at a brick and mortar retailer, knowing that they already have regular recycling routines for cardboard waste. We can combine our orders so fewer boxes are needed. We can get real and get with the program by putting our cardboard waste in the recycling bin. We can reuse the boxes for other purposes. Or we can simply stop buying so much stuff.

For now, perhaps ironically, cardboard is the greenest option and one that gives displaced paper mill workers and their communities another shot at surviving in the digital economy. As the Times story hinted, a number of mills that closed over the last few years will also be upgraded and reopened to pulp recycled cardboard for new brown paper products. Whom to thank for that? The shuttered plants were purchased by Chinese paper manufacturers who rely on recovered cardboard waste, the supply of which has dwindled with their country’s ban on imported waste.

So should we suffer anxiety over the amount of paper waste generated by home-delivery services, or give thanks for lessened car travel? How green is our Amazon? (Other companies also deliver, of course.)

The answer lies elsewhere—in a comprehensive recycling system for all our household and workplace media, be they cardboard boxes or smartphones, paid for as part of extended producer responsibility by the firms that sell them to us. After all, Amazon’s market valuation topped $1 trillion last fall.