I think the actual economics paper[1] is far more interesting than Amazon’s PR spin on it. What Amazon (I suspect) knows but the paper authors sidestep a bit is the elasticity of the unskilled low-wage labor market. If you’re a waiter or a cashier and your boss or the job requirements become unbearable it’s not terribly difficult to waltz into Home Depot or the local grocery store and get a new job making the same amount of money.
Amazon paints their $15 as a benevolent community service but given all that we know about the expectations and requirements of an Amazon warehouse worker it seems to me that Amazon’s wage increase was necessary in order to compete in the labor market. If you could work in an Amazon warehouse for $X/hour or work stocking shelves at Target for $X/hour very few people are going to choose Amazon. And this is evidenced in the referenced/linked economics paper. Amazon’s 2018 wage increase from $11/hour to $15/hour resulted in an average local unskilled low-wage increase of 4.7% suggesting those local markets didn’t need to meet Amazon’s wages in order to compete with them.
The $15 is enough to lure some people to work at Amazon but it seems there are others for which slightly lower pay and the benefit of bathroom breaks is a trade-off they’re willing to make in the labor market.
Amazon paints their $15 as a benevolent community service but given all that we know about the expectations and requirements of an Amazon warehouse worker it seems to me that Amazon’s wage increase was necessary in order to compete in the labor market. If you could work in an Amazon warehouse for $X/hour or work stocking shelves at Target for $X/hour very few people are going to choose Amazon. And this is evidenced in the referenced/linked economics paper. Amazon’s 2018 wage increase from $11/hour to $15/hour resulted in an average local unskilled low-wage increase of 4.7% suggesting those local markets didn’t need to meet Amazon’s wages in order to compete with them.
The $15 is enough to lure some people to work at Amazon but it seems there are others for which slightly lower pay and the benefit of bathroom breaks is a trade-off they’re willing to make in the labor market.
[1]https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3793677