Is Amazon Paying Industry Standard Wages for Warehouse Workers?

Glenn Taylor
·4 min read

Although Amazon said it’s raising the minimum hourly starting pay for warehouse workers to $17 when it recruits 250,000 holiday employees, one nonprofit advocacy organization claims the Seattle company pays less than other warehouse employers.

Amazon warehouse workers on average earn 18 percent less, or roughly $822 less a month, than warehouse workers located in comparable counties where the company doesn’t operate, The National Employment Law Project (NELP) wrote in a recent report.

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NELP cited U.S. Census Bureau data and information that Amazon reported to the Occupational Health and Safety Administration (OSHA).

The report claims that before Amazon opened fulfillment centers in the counties examined in the report, warehouse workers in those areas took home much closer to “middle-income earnings.”

Warehouse workers have seen a significant drop in pay since Amazon’s arrival, from 10 percent less than the average high-earnings income in 2005, to roughly 30 percent less in 2022, according to report.

By contrast, other comparable counties without an Amazon fulfillment center saw a small wage change (negative 8 percent on average in both 2005 and 2022), suggesting that Amazon’s arrival had a larger impact on warehouse worker earnings where it operates.

“Amazon is at a crossroads. It has gotten away with such low pay for incredibly grueling work by taking advantage of people’s economic vulnerability and the lack of job opportunities in many places around the country. But with the vast resources at its disposal, Amazon could instead offer U.S. workers a real lifeline out of insecurity and having to live from hand to mouth,” said Irene Tung, a senior researcher and policy analyst at NELP. “Unfortunately, Amazon is unlikely to prioritize fair pay unless it is pushed to do so, which is why workers’ efforts to organize unions at Amazon are so important to building a good-jobs economy and advancing racial equity in the U.S.”

Amazon criticized NELP’s methodology and what it described as selective data analysis.

“This ‘report’ is full of misleading, inaccurate and downright false claims created by playing a shell game with data. The methodology is not up to the standards of best practices used by economists, and leads readers to a conclusion that isn’t true,” said Amazon spokesperson Jennifer Flagg. “The fact is that most Amazon hourly employees are paid the same or more by Amazon than their previous employers and the presence of Amazon fulfillment and distribution centers increase annual pay by an average of 1.8 percent in a community.”

Flagg cited a 2022 U.S. Chamber of Commerce study stating that distribution centers like the ones Amazon operates increase wages for all workers in a metropolitan area by 1.8 percent annually, which is equivalent to $359 million in additional salaries and wages.

NELP’s report come as Amazon faces new claims from the National Labor Relations Board (NLRB), which has 222 open or settled unfair labor practice (ULPs) charges filed against the e-commerce giant in 25 states.

In a complaint issued Sept. 28, the agency accused Amazon of breaching obligations under a 2021 settlement. The U.S. government could fast-track its probe into claims that Amazon illegally tried to suppress union organizing at a Staten Island, N.Y. warehouse.

The complaint, first reported by Bloomberg News, states that Amazon should be forced to stop enacting or enforcing rules that unlawfully interfere with workers’ rights. The NLRB also said Amazon should issue emails and post physical notices for employees about their rights.

The settlement was related to allegations that Amazon issued an unlawful policy nationwide in 2020, requiring staff to leave its property within 15 minutes after their shift ends. According to the agency, it later enforced that policy at sites in Illinois and New York where employees were organizing by ordering workers to leave or threatening to call police when they didn’t comply.

“We’ve fully complied with the settlement agreement, which we voluntarily entered into in December 2021,” Amazon spokesperson Mary Kate Paradis told Sourcing Journal. “This complaint has no merit and contradicts the very same regional office who confirmed our full compliance with the agreement and closed the cases over a year ago.”

The NLRB lacks the authority to fine companies or hold executives personally liable for violations, and its rulings may be appealed to federal court.

After 340,000 UPS workers secured a new labor contract and strikes affect automotive and entertainment industries, the threat of broader unionization at Amazon feels more possible than it did even just a few months ago.

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