Amazon To Raise Minimum Wage To $15 Starting Next Month

Oct 2, 2018
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RACHEL MARTIN, HOST:

All right. There was some big news out of one of the world's biggest companies today. The Seattle-based company Amazon announced that it plans to raise wages to $15 an hour. That is for all full-time, part-time and seasonal workers. They're going to start this next month. It's a bold move for a company that's been in the spotlight lately and not in a good way necessarily. NPR's Alina Selyukh is here in the studio to talk through what this change means. Hi, Alina.

ALINA SELYUKH, BYLINE: Hi, good morning.

MARTIN: And just to note here - Amazon is one of NPR's financial supporters. So Alina, what other details can you share?

SELYUKH: Right. So they issued a press release, and here are a few takes-away (ph) from that - takeaways from that. You mentioned that the $15 minimum wage will apply to full-time, part-time and seasonal workers. Also importantly, temporary workers, so contract workers, which is where a lot of the scrutiny has been for Amazon specifically. They issued a number a few months ago, saying that the median wage at Amazon was less than $29,000 a year, which is a very interesting contrast to the fact that the company also this year topped $1 trillion in worth. And so for the contract workers, that $15 minimum wage will mean a lot. Also the number of employees that will be affected by this is pretty staggering. It's more than 250,000 Amazon employees.

MARTIN: Wow. I mean, I noted it. You just talked about it. Amazon has been under a lot of very public scrutiny for how it treats its employees, not just the median wage which you outlined but just the conditions of workers. Is this change a result of that public scrutiny?

SELYUKH: Well, it's unclear. You know, if you follow Amazon - if you wait kind of long enough, there will inevitably be some kind of a story in the news about a specific - it's usually a specific warehouse in a specific location where some - a criticism comes up about the way that the employees were being monitored or how much money they make. And in general, Amazon usually comes back to that to say, well, actually, all of our full-time workers - in warehouses as well - do make $15 to begin with if you count in all the benefits and things like that. But the interesting thing is that this has become kind of a rallying cry. Senator Bernie Sanders has gone after Amazon for this. Bezos - CEO Jeff Bezos came to speak in Washington a few weeks ago, and I went to that. And outside of the hotel, there was a small group of protesters. They described themselves as socialists, and mainly what they did talk about was specifically that optical kind of contrast of Jeff Bezos, not just the wealthiest man in the world but the wealthiest man in history, running a company where the employees were not making a huge amount of money. And they had little signs talking specifically about that. And the other thing to remember is just how vast Amazon has become in a few months recently.

MARTIN: Right. I mean, what's the larger business context for this? Amazon clearly is doing well in this moment, so they're feeling like they can afford this change.

SELYUKH: It's - I think that's part of it. And, you know, Amazon CEO Jeff Bezos gets asked a lot about, you know, do you think your company is too big? They did buy Whole Foods recently. They have a variety of businesses getting into cloud services, getting into deliveries. I mean, we're talking truck - fleets of truck drivers, fleets of warehouse workers, fleets of, you know, call-service people. And he often turns it into a bit of a philosophical conversation about, you know, large institutions should be scrutinized. You know, it's not personal. Large institutions anywhere should be scrutinized. But the fact that they now do have sort of this interesting span of workers in retail and on the business side kind of does make it an interesting development that they are raising minimum wage.

MARTIN: I mean, lawmakers on Capitol Hill - you mentioned Bernie Sanders, but others have been pushing for a federal minimum wage of $15 an hour. How is this move now by Amazon - such an important company - how is that going to affect that effort?

SELYUKH: Well, there's a really big thing in that press release that Amazon issued, which is they're saying they are going to, quote, "working to gain congressional support for an increase in the federal minimum wage," which could be huge. If you have one of the most valuable American companies now lobbying for a $15 minimum wage federally, that could be really huge. It's important to note that other companies have been moving toward this. A lot of the states have been moving toward this. Target is one example I can offer of a company that is going for $15 by 2020. And also importantly, in this moment, the timing of this is interesting. We're about to go into the holiday season. And Amazon says it will pay its seasonal workers $15. This is perfectly timed for that. That creates a lot of pressure on a lot of the other retailers that are battling in this really tight labor market for the exact same types of people...

MARTIN: Employees.

SELYUKH: ...Who might be looking for employment...

MARTIN: Right.

SELYUKH: ...During the holiday season.

MARTIN: All right, great explainer. NPR business reporter Alina Selyukh for us on this announcement that Amazon is raising its minimum wage to $15 an hour. Thanks so much, Alina.

SELYUKH: Thank you.

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