E-commerce giant Amazon recently announced a $2.2 billion initiative that will increase hourly wages for its order fulfillment and transportation workers to $22 per hour and to more than $29 per hour for those with benefits packages—with analysis showing that it's in the top tier of retailers offering competitive wages.
Amazon has touted its recent wage increase as its “biggest ever investment” in its employee team.
“This is part of an annual process where we review our wages and benefits to ensure that they stay competitive – and in many cases industry-leading – and I’m proud to say that this year is our biggest ever investment in our team. It’s one of the many ways that we say thank you for all the work that they do to support our customers and communities, and it was exciting to be able to share the news with hundreds of them in person,” said Udit Madan, Vice President, Amazon Worldwide Operations.
Madan traveled to the company’s facility in Salt Lake City, Utah on Sept. 18 to deliver the news to employees in person, concurrent with the company’s public statement.
Previously, Amazon more than doubled the federal minimum wage and increased its workers’ starting wages to $15 per hour in 2018 and have followed up by increasing it each year since then. For full-time employees working a 40-hour week, this is an average salary increase of $3,000 per year. Employees will also be eligible to receive free Prime memberships.
Madan elaborated on how the move would supplement employee benefits.
“For many years, we’ve worked hard to offer one of the best benefits packages in our industry, which includes things like health care from the first day on the job, dental coverage, a 401(k) program with a company match, flexible working hours and even pre-paid college tuition. Throughout each year, we listen to our teams’ feedback and make adjustments to our benefits – from little (but important) things like offering scheduling flexibility when life happens with Unpaid Personal Time (UPT) that employees accrue, to bigger network-wide things like adding new features to our pre-paid education program, which we call Career Choice,” Madan said.
With more than 200,000 participants around the globe, Career Choice teams up with educators in 600 schools across 14 nations to help employees develop new skills. In its partnership, Amazon focuses on fields like healthcare, tech, mechanical and industrial systems, administration and business services, and transportation. Students benefit from prepaid tuition and reimbursement for books and fees that fall within a preset annual limit.
A Business Insider article published in May reported retail wages had been trending upward in recent years, collecting data found in the most recent proxy filings that publicly traded companies must file with the U.S. Securities and Exchange Commission.
Among 19 median wages for workers at some of the top retailers in the U.S., Amazon ranked No. 2 on Business Insider’s list with $36,274. Only Costco, with a figure of $50,202, was ranked higher.
“When calculating its median compensation, Amazon considers all full-time, part-time and temporary employees worldwide, excluding CEO Andy Jassy. When considering only U.S. full-time employees, the median annual compensation was $45,613,” per Business Insider.
Amazon is one of the United States’ largest private employers, boasting a front-line workforce of 800,000 people.