When Hibaq Mohamed started working at a new Amazon fulfillment center in Shakopee, Minnesota, in 2016, she was required to pack a minimum of about 160 boxes an hour with items ordered by the e-commerce giant’s customers.
In the three years since, the company founded by billionaire Jeff Bezos has raised that standard to more than 250, she said.
“They’re pushing us to work like robots, like a machine,” said Mohamed, one of more than 200 Shakopee employees who planned to protest working conditions by leaving their posts for a six-hour span on Prime Day, a heavily promoted event that now spans 48 hours and is one of Amazon’s busiest shopping periods. “We’re struggling.”
The protest during Prime Day, named after the Prime membership that lets Amazon shoppers pay a yearly fee in return for free deliveries and other benefits, demonstrates not only the discontent among Amazon employees but also how a tight U.S. labor market has empowered frustrated workers who want more from their employers.
“We know that when labor markets are slacked, workers are going to have less capacity to make wage demands or workplace demands,” said Michael Hicks, an economics professor at Ball State University. Now, however, “if you’re not happy with an employer there is an opportunity to move the needle,” he said.
Amazon, for its part, stressed it has already met demands including higher pay from employees in Shakopee: It now offers hourly wages ranging from $16.25 to $20.80 and comprehensive benefits.
“We encourage anyone to compare our pay, benefits, and workplace to other retailers and major employers in the Shakopee community and across the country, and we invite anyone to see for themselves by taking a tour of the facility,” an Amazon spokesman said.
The Trump administration frequently boasts about the strength of the U.S. economy, and the latest jobs report from the Labor Department showed 224,000 jobs were created last month while the unemployment rate stayed below 4% for the fifth straight month.
Because of the resulting pressure to attract and retain talent, many companies are using the same tactics as Amazon, boosting wages and ramping up benefits.
Amazon raised the minimum wage for its more than 250,000 U.S. employees to $15 an hour in December and even boosted pay for workers already making that amount. Target and Walmart also increased their minimum hourly pay, with an eye to reaching $15 in the coming years.
It’s not only workers making demands. At least six Democrats seeking the presidency in 2020 support doubling the federal minimum wage, which sits at $7.25, and Democrats in Congress are expected to vote in the coming weeks on legislation that would boost the standard to $15 an hour by 2024.
The Congressional Budget Office found that raising the minimum wage to that level would increase the pay of roughly 17 million workers who make below $15 an hour, but would cost 1.3 million jobs.
“The pressure across labor markets isn’t just confined to the employer-employee relationship,” Hicks said, “but also the government-employer relationship.”
While the tight labor market may give workers more leeway to pressure their managers, Hicks said those in large, urban settings enjoy an added layer of security.
Amazon, for example, is unlikely to shutter a fulfillment center in a metropolitan area with a large population. And the strike, spread across two shifts, probably won’t derail Prime Day, since it’s confined to the one order-fulfillment center in Minnesota.
One looming shadow over employees is the threat of automation, Hicks noted.
“If Bezos had the capacity to do it right now, every Amazon fulfillment center job would be replaced by automation, and he’s headed that way,” he said. “There are, I think, automation pressures that have made it more difficult for workers to make the case for higher wages.”
At some point, he added, “it becomes more profitable to take the tax incentives and low cost of capital.”
