Amazon has announced a significant wage increase for its warehouse workers, raising the average starting pay to more than $22 an hour from the previous rate of approximately $20.50 an hour.
TakeAway Points:
- Amazon raises average warehouse worker pay to over $22/hour, up from $20.50, impacting hundreds of thousands of employees.
- Additionally, a new benefit for employees will be a free one-year subscription to Prime, worth $140.
- The report stated that the wage increase and new benefits will take place as Amazon gets ready for the holidays and prepares for a second Prime Day event on October 8–9.
Wage increment for warehouse workers
Thousands of workers will be affected by Amazon’s decision to increase the average pay for warehouse workers from $20.50 to $22/hour. This change will take effect this month and impacts hundreds of thousands of employees within Amazon’s extensive logistics network. The wage hike is part of a broader $2.1 billion investment this year into Amazon’s third-party logistics program, which also saw contracted delivery drivers’ wages increase to roughly $22 an hour last week.
The timing of this wage increase coincides with Amazon’s preparation for the peak holiday shopping season, a period characterized by a surge in online shopping activity. The company is also planning to host a second Prime Day-like event on October 8-9, marking the third consecutive year for this discount event.
Benefit for New Hires: Prime Membership
In addition to the wage increase, Amazon is introducing a new employee benefit: a complimentary Prime subscription. Starting early next year, warehouse workers will receive access to Amazon’s Prime service, which costs $140 annually. This service includes benefits such as expedited shipping and access to video streaming, among others.
The inclusion of Prime as part of the employee benefits package is a strategic move by Amazon to enhance the overall compensation and benefits for its front-line employees. This initiative aims to improve employee satisfaction and retention, particularly as the company gears up for the busy holiday season.
Strategic Timing and Investment
According to the report, the wage hikes and new benefits come at a crucial time for Amazon as it prepares for the holiday shopping season. The company’s decision to increase wages and add new perks is likely aimed at ensuring a stable and motivated workforce during this critical period. The $2.1 billion investment into the third-party logistics program underscores Amazon’s commitment to maintaining a robust and efficient supply chain.
Amazon’s upcoming Prime Day-like event on October 8-9 is expected to drive significant online sales, further emphasizing the need for a well-compensated and efficient workforce. The event has become an annual tradition, offering substantial discounts and deals to customers, thereby boosting sales and customer engagement.
Contract drivers new wages
Meanwhile, Amazon announced on Thursday that it is raising the average national pay for its contracted delivery drivers to approximately $22 an hour, up from $20.50 an hour. This wage increase is part of Amazon’s $2.1 billion investment this year into its Delivery Service Partner (DSP) program. The DSP program consists of contracted firms responsible for the last-mile delivery of packages from Amazon warehouses to customers’ doorsteps.
