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

[John F]

Originally Posted by DuckieTigger

@John F: The median theoretically allows half the workers to be making less than $15. In practice not so much. It is a fair assumption that half the workers at Amazon are warehouse worker bees? Then minimum and median is practically the same. Upper management never comes into play with median calculations, not even the programmers unless you talk about a software only company (Amazon is not). Lower management, aka shift supervisors in a warehouse, will also be a small enough number to not show up in median calculations.

Well if you are arguing that the $15+ is representative of a warehouse employee, than I have to question where the $15+ came from, since doing quick googles came up with lower numbers, for example:

"... Meanwhile, Amazon’s warehouse workers make an average of $13 an hour, according to Glassdoor. Compare that figure to Walmart—not exactly a beacon of employee satisfaction—which pays its distribution center employees an average of $17 an hour, according to Payscale. ..."

[frahse]

Originally Posted by John F

Are you saying the new base won't apply to full time employees?

No I am not, but some are already making more than $15/hour. (See my next post today.)

[frahse]

Originally Posted by DiapDealer

If $15 an hour is what many people consider to be a minimum "living wage," then I have never been able to make a living at what I do. I wonder what I've been doing all this time if not living?

Take a look at your pic!

[frahse]

Originally Posted by DuckieTigger

I see nothing wrong with his phrasing. I automatically read it as also applies to part time and temporary. And that the change is limited to have an effect on part time and temporary only as full time more than likely already has $15+.

Right on you clever beast. (Reminds me of the first Jurassic Park movie where the great white hunter realized that one of the raptors was hunting him and said Clever Girl!

[frahse]

Originally Posted by John F

I also question the "more than $15+".

Depends, if the median is $15+, half could be making more than $15, and half could be making less, in which case your "more than likely" would be false.*

And by "median full time worker", I assume he means all full time employees. Doing a quick Google, I see a couple of different numbers,

"... average salary with compensation, $28,446 ...",

and

"... Amazon Amazon Warehouse Worker Hourly Pay. The typical Amazon Amazon Warehouse Worker salary is $12. Amazon Warehouse Worker salaries at Amazon can range from $9 - $17. This estimate is based upon 669 Amazon Amazon Warehouse Worker salary report(s) provided by employees or estimated based upon statistical methods. ..."

and

"... The average salary for software engineers at Amazon is north of $100,000, according to data from PayScale, a salary comparison service. By comparison, a full-time warehouse associate at one of Amazon's fulfillment centers in New Jersey could make as much as $13.85 per hour, according to a current job posting ..."

I don't mean to belittle Amazon's pay raise. Kudos to Amazon.


* I admit that I am extremely stretching it here.

Google some more. There is another number that will calculate above $16/hr. All these numbers are somebody's ballpark figure for a certain set of parameters and delimiters. They are not necessarily on anyone's pay slip.

[frahse]

And finally after we have thrashed about in the water like a bunch of crazy sharks after a chum bucket has been emptied, the Dark One (see Robert Jordan's Wheel of Time for reference) releases his "Counter Strike": Amazon's hourly workers lose monthly bonuses and stock awards as minimum wage increases

[ZodWallop]

Originally Posted by frahse

And finally after we have thrashed about in the water like a bunch of crazy sharks after a chum bucket has been emptied, the Dark One (see Robert Jordan's Wheel of Time for reference) releases his "Counter Strike": Amazon's hourly workers lose monthly bonuses and stock awards as minimum wage increases

Not much of a counter strike.

Selective quotes (only because quoting the entire article would be tedious):

The company, however, stressed that the wage increase "more than compensates" for the loss in other benefits.

Additionally, workers affected by the change will get a chance to review the new pay structures and share any concerns they might have with the company...

Amazon disclosed in its announcement on Tuesday that it is replacing the stock awards program with the minimum-wage increase because employees prefer the "predictability and immediacy of cash" compared with stock awards.

[fjtorres]

I suspect stockholders prefer the tradeoff: less stock dilution as the company workforce keeps on growing.

[DuckieTigger]

Originally Posted by ZodWallop

Not much of a counter strike.

Selective quotes (only because quoting the entire article would be tedious):

Not? If all you are obsessed about is a number per hour before taxes and before deductions, then maybe not. Getting paid includes benefits. Most people don't see past that number. You can make $2 more an hour and still come out short at the bottom line, because company A had great benefits that included 100% paid medical insurance, and company B lured people in by a higher pay AND monthly insurance payment of $400+ for family. Unfortunately to be competitive means a higher number per hour. The company I work for used to be 100% paid insurance (literally company A in above) and a new distribution center/warehouse (not Amazon) is company B. What my company did was to give everybody already hired in a $1.50 raise, but now we have to pay part of the insurance. New hires can be advertised a little bit higher than before, even though they don't get the extra $1.50. Only so it doesn't look like we weren't competetive in wages.

Benefits count.

[fjtorres]

Originally Posted by DuckieTigger

Not? If all you are obsessed about is a number per hour before taxes and before deductions, then maybe not. Getting paid includes benefits. Most people don't see past that number. You can make $2 more an hour and still come out short at the bottom line, because company A had great benefits that included 100% paid medical insurance, and company B lured people in by a higher pay AND monthly insurance payment of $400+ for family. Unfortunately to be competitive means a higher number per hour. The company I work for used to be 100% paid insurance (literally company A in above) and a new distribution center/warehouse (not Amazon) is company B. What my company did was to give everybody already hired in a $1.50 raise, but now we have to pay part of the insurance. New hires can be advertised a little bit higher than before, even though they don't get the extra $1.50. Only so it doesn't look like we weren't competetive in wages.

Benefits count.

Depending on the state, benefits might be tax-free whereas salary is taxed in most places.

https://www.nolo.com/legal-encyclope...-tax-free.html

So state governments will almost certainly get more money but whether the employees get more money will vary. Veteran employees that had been around long enough to vest into the stock program will very likely see less money down the road.

https://www.nbcnews.com/tech/tech-ne...e-hike-n916466

part of Amazon’s new pay structure, the company ended its bonus and stock incentive programs for warehouse and customer service workers. Those payments rewarded workers for staying with the company and for working consistently.

"It's a joke," said Amazon warehouse employee Vicki Shannon Allen, who made headlines this summer after she made videos documenting her experience as a homeless Amazon employee. "We get no more bonuses for not missing any work. "

Shannon also said she has concerns over what will happen to the portion of her income that was delivered in the form of stock options.

Amazon drew broad approval on Tuesday when the company announced that it would be setting a $15 hourly minimum wage for its workers. The company had been under pressure from activists and politicians who claimed Amazon warehouses employees were underpaid and overworked.

Amazon warehouse workers who spoke to NBC News on Tuesday said they were supportive of the move, but did note that the stock incentives had provided a significant bump in pay. One said that some workers were frustrated that newly hired employees would be receiving sizable wages that had taken veteran workers years to earn.

No doubt the numbers will show a boost for this year...
...but stock options are a gift that keeps on giving as long as the stock price keeps on rising, which is why tech startups use options instead of just salary as a recruiting tool.

But at least now the politicians will let up that particular attack. Too bad they didn't ask the workers.

[DuckieTigger]

@fjtorres: So you are basically saying it was a political publicity stunt on Amazon's part? I don't disagree. Not sure how Amazon used to handle the bonus for not missing work which is also now gone, but I would complain about that. For me personally it is worth an extra dollar per hour for not missing anything in a month.

[fjtorres]

Originally Posted by DuckieTigger

@fjtorres: So you are basically saying it was a political publicity stunt on Amazon's part? I don't disagree. Not sure how Amazon used to handle the bonus for not missing work which is also now gone, but I would complain about that. For me personally it is worth an extra dollar per hour for not missing anything in a month.

Not necessarily a stunt.
Remember, they got the Sanders mob to take credit for forcing the move.

So it's more of a bottom line decision that they let them shut up the IdiotPoliticians™ at little net cost and put the squeeze on other competitors for whom going to $15 is a big added cost since they have no offsetting perks to kill.

They are, as I keep saying, a tricky bunch.

They operated like a tech company--stock options, generous perks, etc--and all it bought them was grief. Well, they figured out how to give the mob with the torches and pitchforks what they wanted without hurting their competitive positioning on the retail side. Since their bottom line isn't seriously impacted by the swap, and it pressures other big players to follow suit while, as I said, reducing the stock options (which helps existing stockholders) they get a three-fer. A win-win-win.

By the time the dust settles and the stock goes past $2000 Bezos will have another couple billion to put into Blue Origin courtesy of the rabble rousers.
(And since Amazon is boosting its warehouse automation, any employees quitting will simply save them from doing formal layoffs. A fourth, longer term, win.)

It reminds me of the the four hour price war and the launch of the "Special Offers" K3. Nook moved to near cost pricing, thinking they could undercut Amazon and Amazon not only matched them, but used ads to stay lower and offset the lost revenue. And then they used the Kindle ads to start ramping up an ad business that is currently running at $4B a year and growing ridiculously.

https://www.businessinsider.com/amaz...in-2018-2018-1

Think of it as making premium lemonade when life (and competitors/enemies) give you free lemons.

[John F]

Originally Posted by frahse

Google some more. There is another number that will calculate above $16/hr. All these numbers are somebody's ballpark figure for a certain set of parameters and delimiters. They are not necessarily on anyone's pay slip.

Could you provide the links/quotes please? I quoted four articles, and Googling I couldn't find any that were 15+.

Please and thank you.

[ZodWallop]

Originally Posted by DuckieTigger

Not? If all you are obsessed about is a number per hour before taxes and before deductions, then maybe not.

But like it or not, the average hourly Amazon warehouse employee is likely to be happier with the increased salary. Similar to the way people are happy with a tax break even if the vast majority of the benefits go to the extremely wealthy and it causes programs that benefit the poor to be cut. People can be short-sighted.

[fjtorres]

Originally Posted by ZodWallop

But like it or not, the average hourly Amazon warehouse employee is likely to be happier with the increased salary. Similar to the way people are happy with a tax break even if the vast majority of the benefits go to the extremely wealthy and it causes programs that benefit the poor to be cut. People can be short-sighted.

Have you asked them?
NBC did and they're not all happy.

New hires and temps will *start* a couple bucks higher but the veterans who received part of their pay as ever-appreciating stock will end up with less in pocket down the road. Probably as early as next year.

And yes, people can be and were short-sighted.
Those stock options meant a *lot* to the veterans. And the bonuses, too.

The problem the activists refuse to accept is that a job is only worth the value it adds to the product or service. Blindly squeezing employers will either result in added product prices or the outright end of the product if the profit margin goes away.

And just like a lot of people refuse to pay more than x-amount for a backlist ebook because it isn't worth more to them, business types can and do refuse to pay more for a job than it is worth to them. And it's not just a matter of "greed": oftentimes the revenue just doesn't allow the added cost for that product.

Without going too far, quite a few bookstores have closed in recent years because their costs exceeded their revenues. And those were places paying minimum wage with minimal if any perks. And more will close as the rush to fifteen takes hold.

Minimum wage or not, employees *always* cost employers a lot more than just the nominal salary; there are taxes, pension contributions, health care costs, and negotiated perks like free tuition, free meals, free day care, etc. Different companies balance out salary vs benefits depending on the nature of the job and prevailing terms in their sector.

Once you get past entry level minimum skill jobs, no two companies offer the exact same compensation packages.

In this particular case, Amazon offered entry level employees prevailing rate salaries with added fringe benefits more typical of tech companies than of retail.

Now they will treat the hourly warehouse workers to "industry-leading" salaries but without the benefits offered to their tech industry employees.

And, as I pointed out: salaries are taxable but the now-lost benefits weren't. So the net making its way to the employee's pockets will be a lower fraction of Amazon's cost. And to whatever extent Amazon's cost go up, there will be an added incentive to accelerate automatization.

Short term thinking indeed.
Not a particularly good deal for Amazon's employees but a pretty good deal for stockholders.