Amazon ups hourly wage to $15, will advocate for higher pay

5 months 2 weeks 3 days ago Tuesday, October 02 2018 Oct 2, 2018 Tuesday, October 02, 2018 11:36:19 AM CDT October 02, 2018 in News
Source: AP
By: Joseph Pisani and Michelle Chapman, The Associated Press

NEW YORK (AP) — Amazon is boosting its minimum wage for all U.S. workers to $15 per hour starting next month and said it will push for an increase in the federally mandated minimum wage, which now stands at $7.25 per hour.

The company, whose value topped $1 trillion briefly in September, was facing political and economic pressure to raise pay for thousands of employees.

"We listened to our critics, thought hard about what we wanted to do, and decided we want to lead," said Jeff Bezos, Amazon's founder and CEO.

The wage hike also comes at a time Amazon needs to hire holiday workers amid the tightest job market in nearly two decades, making it more difficult to lure workers who have a lot more job choices than just a year ago. Amazon said it plans to hire more than 100,000 holiday workers, who will pack and ship boxes in its more than 100 warehouses around the country.

"We have seen a labor market that is becoming better and better for job seekers, and harder and harder for employers," said Martha Gimbel, director of economic research and job site Indeed.

Amazon said Tuesday that the raise will benefit more than 350,000 workers, which includes full-time, part-time, temporary and seasonal positions. Employees at Whole Foods, the upscale grocery chain Amazon owns, will get the same pay hike. Some hourly Amazon employees who already make $15 per hour will also see a wage increase, the Seattle company said.

Amazon has faced criticism from labor rights groups and others over pay and working conditions at its warehouses. One of its harshest critics is U.S. Senator Bernie Sanders. His Twitter account, which has nearly 9 million followers, frequently points out the disparity between Amazon's median employee pay and Bezos' vast fortune.

Sanders congratulated Bezos Tuesday for "doing exactly the right thing," and urged other companies to do the same.

Despite its domination, Amazon shares one potential hurdle that is growing higher for almost all employers big and small: a tightening labor market. The unemployment rate is 3.9 percent, near an 18-year low. The most recent statistics from the U.S. Labor Department showed that in August, the pace of hiring rose again and wages grew at their fastest pace in nine years.

Average hourly pay jumped 0.4 percent in August and increased 2.9 percent compared with a year earlier. That's the fastest annual gain since the Great Recession ended. There are now more available jobs than unemployed people, the first time that has happened in the 18 years that data on open jobs has been tracked.

As competition among companies for qualified workers grows more intense, they are increasingly willing to pay more wages.

Raising starting wages isn't just good publicity for Amazon and other major retailers. It helps them save money that would be lost as trained workers leave for higher pay elsewhere.

Both Walmart and Target say their businesses have benefited from their moves to raise wages. Walmart has seen lower turnover among its employees and has said that its higher pay helped improve customer experience in the stores. Walmart is currently the largest private employer in the nation, with a workforce topping 1.5 million employees.

Target said that it has seen a better pool of applicants after its moves to hike hourly pay.

Target's CEO Brian Cornell recently said that the number of job applicants rose by 60 percent in the days after Target increased its minimum wage by $2 to $11 per hour last year. This past spring, it raised its starting hourly pay for its workers to $12. Target said last September that it planned to raise hourly pay to $15 by 2020. With Tuesday's move, Amazon has done that already.

Pay for warehouse workers at Amazon can vary by location. It was offering at least $12.25 an hour in Omaha, Nebraska, $13 in Baltimore and $16.50 in New York, according to recent job postings. The median pay for an Amazon employee last year was $28,446 worldwide, according to government filings, which includes full-time, part-time and temporary workers.

In two decades the company expanded far beyond its bookseller beginnings, combining its world-spanning retail operation with less flashy but very profitable advertising and cloud computing businesses. Last month it became the second publicly traded company to be worth $1 trillion, hot on the heels of Apple.

But corporate profits in the U.S. are booming, and that wealth isn't being spread out nearly fast enough for many. Amazon earned $2.53 billion in just the second quarter alone.

On Tuesday, fast food workers in Michigan are going to kick off a series of protests in the Midwest and elsewhere around the country in support of unions and a $15 minimum age.

Neil Saunders, managing director of GlobalData Retail, said Tuesday that while Amazon's wage hike is a politically savvy move, it's also a change made out of economic necessity. With a healthy U.S. economy, Americans looking for work have an increaseng number of job options, so Amazon has to find ways to entice people to join its company.

Amazon is also increasing wages in some areas outside the U.S. The company announced that the minimum wage will be 10.50 pounds an hour in London and 9.50 pounds in other parts of the UK. The increases will include 17,000 Amazon employees as well as 20,000 seasonal workers.

Amazon.com shares were little changed Tuesday, but they have been among the best performers in the S&P 500 this year, with a gain of about 70 percent, compared with a gain of 9 percent for the S&P.

The company is the second-most valuable in the index after Apple Inc.

___

Chapman reported from Newark, New Jersey. AP reporters Anne D'Innocenzio in New York and Chris Rugaber in Washington also contributed to this report.

More News

Grid
List
JEFFERSON CITY - Environmental activists plan to make their voices heard at a Missouri Department of Natural Resources (DNR) public... More >>
59 minutes ago Thursday, March 21 2019 Mar 21, 2019 Thursday, March 21, 2019 3:26:00 AM CDT March 21, 2019 in News
COLUMBIA- Brian Treece and Chris Kelly answered public questions regarding a variety of issues facing the Columbia community. When... More >>
5 hours ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 11:23:00 PM CDT March 20, 2019 in News
CHRISTCHURCH, New Zealand (AP) - New Zealand Prime Minister Jacinda Ardern said Thursday her government is immediately banning assault rifles,... More >>
6 hours ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 9:56:00 PM CDT March 20, 2019 in News
JEFFERSON CITY - The Missouri Public Service Commission granted approval Wednesday to the Grain Belt Express, an electric transmission line... More >>
9 hours ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 7:15:00 PM CDT March 20, 2019 in News
CALLAWAY COUNTY - Missouri state troopers had to carefully watch a closure of Highway 94 near Portland earlier this week... More >>
9 hours ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 7:01:00 PM CDT March 20, 2019 in News
COLUMBIA - Columbia’s mayoral race has moved to television as the municipal election on April 2 moves closer. Mayor... More >>
10 hours ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 5:44:00 PM CDT March 20, 2019 in News
FULTON - Everything is free in the Fulton store From His House to Your House. The operation is 100... More >>
11 hours ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 4:57:00 PM CDT March 20, 2019 in News
ASHLAND - A man was arrested after a car and foot chase on Tuesday. Ashland police officers said they... More >>
11 hours ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 4:30:00 PM CDT March 20, 2019 in News
MOBERLY - The Moberly Police Department is investigating a death on East Logan Street, according to police. Police received... More >>
11 hours ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 4:26:00 PM CDT March 20, 2019 in News
MOBERLY - Businesses in Moberly say they'll feel the effect of a new zoning measure which would require future medical... More >>
14 hours ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 2:13:00 PM CDT March 20, 2019 in News
COLUMBIA – Columbia Police Department responded to a shots fired call on Hanover Boulevard Wednesday morning. Police said the... More >>
14 hours ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 1:28:00 PM CDT March 20, 2019 in News
MARIES COUNTY - Prosecutors filed murder and child endangerment charges against a Maries County mother three days after her daughter... More >>
15 hours ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 12:40:00 PM CDT March 20, 2019 in News
COLUMBIA - The man accused in a 2002 rape that resurfaced after a DNA discovery years later has been found... More >>
16 hours ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 11:43:00 AM CDT March 20, 2019 in News
AUXVASSE - Police are asking for the public's help finding 49-year-old Jeffrey Ennis, who has been accused of domestic assault.... More >>
17 hours ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 11:05:00 AM CDT March 20, 2019 in News
COLUMBIA - With elections in Columbia just weeks away, voters will have the chance to meet candidates and discuss other... More >>
1 day ago Wednesday, March 20 2019 Mar 20, 2019 Wednesday, March 20, 2019 3:30:00 AM CDT March 20, 2019 in News
OMAHA - Amtrak service between Kansas City and St. Louis has been temporarily suspended due to increase freight train traffic... More >>
1 day ago Tuesday, March 19 2019 Mar 19, 2019 Tuesday, March 19, 2019 9:59:00 PM CDT March 19, 2019 in News
MARIES COUNTY - Prosecutors have charged Tracy Ellis with second-degree murder and child endangerment after a Sunday night house fire... More >>
1 day ago Tuesday, March 19 2019 Mar 19, 2019 Tuesday, March 19, 2019 7:34:00 PM CDT March 19, 2019 in News
COLUMBIA - When Madison Lawson shops at a retail store, she tends to leave empty-handed. “I want to dress... More >>
1 day ago Tuesday, March 19 2019 Mar 19, 2019 Tuesday, March 19, 2019 7:13:00 PM CDT March 19, 2019 in News
Columbia, MO
Broken Clouds 40°
5am 38°
6am 36°
7am 36°
8am 36°