Amazon’swages leave someworkers struggling
Amazon.com Inc. job ads are everywhere. Plastered on city buses, displayed on career web sites, slottedbetweensongsonclassic rock stations. They promise a quick start, $15 anhour andhealth insurance. In recentweeks, America’s second-largest employer has rolled out videos featuring happy package handlerswearing masks, a pandemic-era twistonitsannual holiday season hiring spree.
Amazon’s object is to persuade potential recruits that there’s no better place to work.
The reality is less rosy. Many Amazon warehouse employees struggle to pay the bills, andmore than 4,000employees areonfood stamps in nine states studied by theU.S. GovernmentAccountability Office. OnlyWalmart, McDonald’s and two dollar-store chains havemoreworkers requiring such assistance, accordingtothereport, which said 70% of recipientswork full-time. As Amazon opens U.S. warehouses at the rate of about one a day, it’s transforming the logistics industry from a career destination with the promise of middle-class wages into entrylevelwork that’s just a notchabove being a burger flipper or convenience store cashier.
Unionworkerswhomakecomfortablelivelihoodsdrivingdelivery trucksandpackingboxes consider Amazonanexistentialthreat. While labor tensions have simmered for years, the stakes have risen sharplyamidthepandemic, which prompted Amazon to hire more than 250,000 people to keep up with surgingdemandfromhomeboundshoppers. Risking infection while toiling in a crowded warehouse
for $15 an hour has many Amazonworkers asking if they’re getting shortchanged.
A Bloomberg analysis of government labor statistics reveals that in community after communitywhere Amazon sets up shop, warehouse wages tend to fall. In 68 counties where Amazon has opened one of its largest facilities, average industry compensation slips by more than 6% during the facility’s first two years, according to data from the Bureau of Labor Statistics. Inmany cases, Amazon quickly becomes the largest logistics player in these counties, so its size and lower pay likely pulls down the average.
WhileAmazon’sarrivalcoincides with rising pay in some southern andlow-wageprecincts, theopposite is true inwealthier parts of the country, including the northeast andMidwest. Six years ago, before thecompanyopeneda giant fulfillment center in Robbinsville, New Jersey, warehouse workersmade
$24 an hour on average, according toBLSdata. Last year the average hourlywage slipped to $17.50.
Wages often tick higher in subsequent years, but don’t reach their pre-Amazonleveltillfiveyearsafter a new facility opens.
“Bloomberg’s conclusion is false — it violates over 50 years of economic thought, and suspends the lawofsupplyanddemand,” acompany spokesperson said. “Hiring more, by paying less, simply does notwork. Many of our employees join Amazon from other jobs in retail which tend to be predominantly part-time, reduced benefit jobswithsubstantiallylessthanour $15minimumwage. Theseemployees see a big increase in pay per hour, total take-home pay, and overall benefits versus their previous jobs. What surprises us is that we are the focus of a story like this when some of the country’s largest employers, including the largest retailer, have yet to join us in raising theminimumwage to$15.”