Amazon Offers Wage Increase to Hire 75,000 Employees

Photo by Reuters

[Asia Economy Reporter Yujin Cho] The world's largest e-commerce company Amazon is set to hire 75,000 new employees in its U.S. logistics warehouse sector. As the COVID-19 pandemic enters a stabilization phase and consumption rapidly increases with economic reopening, the company is offering incentives such as wage increases and bonuses in response to labor shortages.

According to the Wall Street Journal (WSJ) on the 13th (local time), Amazon announced that it will offer new hires a wage of more than $17 per hour. This is higher than the federal minimum wage of $15 promoted by the Joe Biden administration. WSJ reported that the new hires represent about 8% of Amazon's total U.S. workforce.

In addition to wage increases, Amazon is also offering additional bonuses. In some regions, the company plans to provide a one-time bonus of up to $1,000 to employees who have received the COVID-19 vaccine.

Brian Olsavsky, Amazon's Chief Financial Officer (CFO), indirectly expressed difficulties related to increased labor demand and recruitment challenges as various industries experience rising workforce needs due to the economic reopening after COVID-19. He stated, "Since the economic reopening after COVID-19, we have been focusing on building delivery services and expanding logistics warehouses."

Amazon is approaching one of its biggest annual sales events, "Amazon Prime Day." Ahead of this major sales period, the company raised wages by a minimum of 50 cents and up to $3 per hour last month for over 500,000 workers at its U.S. operations. At that time, Amazon explained that the wage increase was intended to encourage hiring across tens of thousands of workplaces nationwide.

Amazon has benefited from the non-face-to-face trend caused by the spread of COVID-19, recording $108.5 billion in sales in the first quarter of this year, a 44% increase compared to the same period last year, surpassing $100 billion in sales for two consecutive quarters.

Net profit during the same period soared more than threefold to $8.1 billion. When converted to earnings per share (EPS), it was $15.79, significantly exceeding Wall Street's consensus of $9.54 per share compiled by financial information firm Refinitiv.

The sales forecast for the second quarter of this year is between $110 billion and $116 billion, indicating that Amazon is expected to continue achieving over $100 billion in sales for three consecutive quarters.