Thursday, October 4, 2018

Amazon’s wage hike not all it’s cracked up to be

Last week, internet retailer Amazon was the darling of the press and a good many politicians of left persuasion when the company announced it was hiking its minimum wage to $15 an hour.

The praise was heaped upon Amazon quite mightily, as the corporate giant’s move fed the narratives around the Fight for Fifteen and many thought CEO Jeff Bezos was showing a brand of benevolent leadership that other companies should follow.

Let’s hope they don’t.

Amazon’s $15 push is at best a half-hearted attempt to improve the financial outcomes of their employees. It’s more of a charade, an excellent marketing ploy that, in the first week, has looked pretty darn effective in endearing the company to the masses.

Giving their employees an extra $1 to $2.50 will do little to advance their lot in life if a great number of them are not given full-time hours and benefits.

Last month and again this past Saturday, Amazon held job fairs to attempt to hire hundreds of part-time workers for their fulfillment center in Lancaster. The job posting is still open on websites like Indeed where it shows three shifts of availability, each one only 4 hours in length. If someone is working 5 days, that’s a 20-hour week. If someone gets a sixth day (the help wanted ad does say at least one weekend day is mandatory), you’re talking 24 hours a week.

That’s a far cry from a standard 40-hour workweek and the potential for overtime that exists in other workplaces. Earnings are one-half to 60 percent of what they would be elsewhere at a similar rate of pay for a full-time week, considerably more for an overtime week.

The proof is in the pudding: Reports show that the median -- not mean -- annual pay for Amazon’s half-million workers was just over $28,400 last year. So, half their workforce earns less than that.

Hiring hundreds of part-timers in the local warehouse, just as it is done at their other fulfillment centers, rather than half as many full-timers is a business decision done to not only keep overtime costs down but also to mitigate the impact of benefits. In the job market, full-time workers expect and deserve benefits. Unfortunately, benefits of any import are rarely extended to part-timers by anyone, and Amazon is taking full advantage of that.

You can see that by downloading the company’s benefits overview. Part-time employees are granted 6 paid holidays, another benefit they call generous unpaid time off (there’s nothing generous about unpaid vacations), dental and vision for the worker only (not her family), and $500 per year to spend on medical expenses, which means no health insurance is funded ($500 won’t put a dent in a $16,000 family plan).

It’s no wonder Amazon had come under fire in recent years for having impoverished employees who, despite the company’s wealth ($177.9 billion in revenues last year), disproportionately rely on SNAP (food stamps) and Medicaid. An April report by the Intercepter found that Amazon was the 28th largest employer in Arizona but it ranked 5th for the number of employees enrolled in SNAP. It held the 5th slot in Pennsylvania as well, though it’s only the 19th largest employer. In Ohio, Amazon ranked 53rd in overall employment but 19th when it came to employees using SNAP.

That’s an outcome of low hours and low benefits. Going to $15 an hour won’t help if opportunity for either isn’t there.

Yet, that same company which was just labeled the bad guy months ago for the SNAP abuses is now looked at as the hero and has vowed to take up the fight to raise the legal standards. Jay Carney, senior vice president of Amazon global corporate affairs, said in a statement, "We intend to advocate for a minimum wage increase that will have a profound impact on the lives of tens of millions of people and families across this country."

This coming from a company that does an end around to not make their workers’ lives fulfilling enough, all while receiving, since 2000, more than $1.1 billion in tax breaks from local and state governments in the US.

Is that the sort of capitalist heroism policymakers and workers want to hold up as being virtuous?

If you want economic heroes look to the small business driven by ethics as much as the bottom line – your local factories, restaurants, retailers, contractors, etc. -- that pay a decent wage, have a steady 40-hour week, offer overtime, grant paid vacations, issue bonuses, and fund health insurance either in-part or whole. They’re the ones really making a difference in the lives of America’s working families.  

From the 08 October 2018 Greater Niagara Newspapers and the Batavia Daily News

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