9 ms·

This feels quite political. I agree that robots are the future, but I think that some structural changes will be needed. Trying to sell it like no jobs are lost

This feels quite political. I agree that robots are the future, but I think that some structural changes will be needed. Trying to sell it like no jobs are lost is quite naive at best, and purposefully misleading at worst. If I remember correctly (don't quote me on that) Amazon used to employ quite a lot of temporary workers and had a high turnover (hire/quit) rate. Then they would no need to purposefully fire anyone to reduce their headcount. Just not temp hiring those people would be enough. Or not hiring as many people as befoe as they grow. Or ... My point: there are many ways of making it look good on paper; but when a robot does a human job, that job is not needed anymore. What IMO we need to do is to keep on discussing structural unemployment from all points of view.

krapp 9y ago
They need the temp workers during peak seasons - they can't really afford to not hire them, nor can they afford to keep on that many longer-term employees.
- mikeyouse 9y ago
  "Afford" is a very relative term. They don't want to be responsible for that many FTEs but with $48 billion in gross margin and $2.5 billion in net income, they can certainly afford to employ a few thousand seasonal workers year round.
  - krapp 9y ago
    That's true. Amazon has "frugality" as a core cultural value - a valid definition of "can't afford it" for them is "just don't want to pay for it."
    - FussyZeus 9y ago
      In my experience, this doesn't make them that different from virtually any corporation. I don't think I've ever worked for one where getting money for literally anything wasn't a constant uphill battle (which incidentally is why so many consumer electronics feel cheap as shit; they are).
      - microcolonel 9y ago
        > In my experience, this doesn't make them that different from virtually any corporation. For that matter, not any different from a typical person. Expenses that you would be better off not incurring are, by definition, frivolous. In the case of Amazon, frivolous spending at any level changes the price at which they can achieve a fair margin and reduces customer satisfaction.
        FussyZeus 9y ago
        Except Corporations take it to a uniquely stupid level; things like refusing to pay adequately for internal support, security, auditing, i.e. anything that doesn't have a direct impact on customers.
        microcolonel 9y ago
        Who are you to say what is the right amount to pay for security? Do you know how much life insurance I should have?
        FussyZeus 9y ago
        Every year I need to have usually a 2 hour meeting with my superiors to argue for renewing our antivirus for our Windows infrastructure. Their constant argument every time is "we have no viruses, why do we spend money on this" and I have to tell them every single time "that you're paying for it is WHY we don't have viruses." They have no idea what viruses are, what malware is, what ransomware is and despite being hired to maintain infrastructure, I must continuously explain my decisions to people who do not maintain infrastructure and wouldn't know how with a gun to their head. This, to me, is stupid.
        microcolonel 9y ago
        Fair enough, but at the end of the day you do convince them, which is why they pay for you. ;- )
        9y ago
    - im3w1l 9y ago
      If they can't, then that's the end of that. If they just don't want to, they can be strongarmed.
      - killjoywashere 9y ago
        Are you suggesting they should be strong-armed into employing underutilized employees? Perhaps we could do that for the finance industry too. Really, by that logic, any company making money should be strong armed into excess hiring. I suppose they could also push for increased wages instead, which seems more tenable once you get close to full employment.
    - skookumchuck 9y ago
      Isn't that true for all of us?
  - asddddd 9y ago
    > a few thousand seasonal workers year round. You're vastly underestimating what sort of effects "peak season" has. UPS hires 95,000 temporary employees each year; FedEx hires 50,000. Amazon hires 120,000. Retail scales up similarly, but I'm less familiar with the industry. "A few thousand" is how much single distribution centers scale up employment.
    - mikeyouse 9y ago
      I think you're vastly underestimating how much money Amazon makes. So Amazon currently hires 120,000 people at $12/hr for 10 weeks for a total cost of somewhere near $576M. This counts as COGS and is included in their gross margin. If we just multiply that figure by (52 / 10) and subtract out the $576M, we can see that it would decrease their annual Gross Margin by $2.5B. Add on an additional 30% of the combined $3B in salary expense since I doubt the temp workers get benefits, and you'd be looking at a total of ~$3.4 billion. So in 2016, this would've changed their gross income from $47.7 (35% GM) billion to $44.3 billion (32.5% GM).
      - Veelox 9y ago
        That $3.4 billion puts their net income negative for the year negative.
        mikeyouse 9y ago
        Right, but net income is a fiction to begin with. It has almost nothing to do with a company's actual health. Last year was the first year that Amazon ever showed a NI over a few hundred million (for most of their life, it's been negative). https://a16z.com/2014/09/05/why-amazon-has-no-profits-and-why-it-works/ https://a16z.com/2014/09/05/why-amazon-has-no-profits-and-wh...
  - sol_remmy 9y ago
    Your saying they should employ a "few thousand workers" unnecessarily from January - October for moral reasons I wonder if you would still act so idealistically if you held stock in the company..
    - mikeyouse 9y ago
      I wasn't saying they should employ them for moral reasons, I was saying that they absolutely could afford to do so. Side note; I do hold stock in the company, and because I'm not an asshole, I do think they should rely less on temp labor and they should improve working conditions for their existing warehouse workers. Even if it reduces my capital gains by some fraction of a percent.
dogruck 9y ago
Certainly might be a native ad. Do you have any data to support your thesis of net job loss correlated to increased automation?
microcolonel 9y ago
> Trying to sell it like no jobs are lost is quite naive at best, and purposefully misleading at worst. Well, the article does literally say "No people were laid off when the robots were installed, and Amazon found new roles for the displaced workers, Mr. Clark said.". Either Mr. Clark is lying, or this point is moot.
- sokoloff 9y ago
  I'm not following. Suppose they "normally" ran 150 full time employees and 150 temp workers for holiday peak. Suppose they have a 25% attrition rate. (37 of those 150 employees quit voluntarily.) After the robots, they could have 115 employees working and still not laid anyone off. Yet, in terms of full time employment, they went from 150 to 115 and in terms of temp labor went from 150 to 0. Did the robots destroy jobs in such a case? I'd think "yes". (I still support the deployment of robots in such cases; I'm only responding to the logical argument here, not the philosophical implications thereof.)
  - microcolonel 9y ago
    > Suppose they have a 25% attrition rate. (37 of those 125 workers quit voluntarily.) Why would they retain employees which they would not rehire (minus wages in place of hiring cost)? They have no obligation to retain these workers, so clearly Amazon's base (non-seasonal) demand for labour increases fast enough to justify retaining them. At the current rate you would expect them to hire more labour, not less. The human jobs described here are still so far beyond current robotic technology that it's likely there will be no easy gains in automation here. Meanwhile, as Amazon's efficiency increases, throughput will also increase, which means demand for labour will continue to increase even if there are marginal increases in automation.
    - vertex-four 9y ago
      > Why would they retain employees which they would not rehire (minus wages in place of hiring cost)? For good relations with the Government which has a goal of decreasing unemployment, and avoiding bad PR in popular media? If you can wait a couple of months to achieve exactly the same outcome with fewer risks, why not. > Meanwhile, as Amazon's efficiency increases, throughput will also increase No, throughput is a function of demand, not efficiency, unless Amazon is currently backlogged.
glangdale 9y ago
Well, it might be the case that no Amazon jobs are lost as a result of this automation - but this won't mean that the increased productivity doesn't cause job losses elsewhere (i.e. in their competition both bricks-and-mortar and online).
- Loic 9y ago
  The problem is that we are losing the simple jobs. You have a lot of people with a basic education, who could do good simple work. The push for higher level of education kind of work is removing them from the market. In Germany, the net effect is that you thousands of apprentice positions free and at the same time thousands of people looking for such positions. The requirements of today's positions are now to high for many young people. So we have a gap between educated people and worker people which is growing extremely fast. This results in a society which is polarizing itself more and more. This is not good on the long term.
  - abpavel 9y ago
    But isn't it simply a misconception? The 10yr statistics doesn't support your argument: https://tradingeconomics.com/germany/unemployment-rate https://tradingeconomics.com/germany/unemployment-rate As an employer, I find it extremely hard to find qualified people, and my entrepreneur friends are having even harder times, with people showing up for their first day of work either drunk, or not at all.
    - Loic 9y ago
      I find it extremely hard to find qualified people. The problem is that a big part of the population is not qualified enough to work and will not be in the future. The 3.7% unemployment rate in Germany is considering something doing a part-time job for less than €400 per month as employed and the long term unemployed people are not part of the stats, the youths are also not in, etc. They are very good at removing many from the stats. If you look at the industrial core of Germany, the Rhein/Ruhr region, you see cities after cities cut in two, one side with 35% of population living from social support and the other side with just 5%. When you "start" your life in the wrong side, you are out of the employment stats right from the start. Note: I am French, living in Gelsenkirchen (such a typical city) and here, we have really hard time finding good engineers even with very good compensation and at the same time we have parts of the city where Doctors without Borders opened a station because the situation is catastrophic.
honestoHeminway 9y ago
Right! This calls for immediate discussion! Completely new motion, eh, that, ah-- that there be, ah, immediate action-- Ah, once the vote has been taken. Well, obviously once the vote's been taken. You can't act another resolution till you've voted on it.. In the-- in the light of fresh information from, ahh, the article--
eighthnate 9y ago
> This feels quite political. It's bloomberg. > Trying to sell it like no jobs are lost is quite naive at best, and purposefully misleading at worst. I agree that it comes off as very cynical and feels like a PR piece for amazon and automation. Also, the problem isn't just that current amzn employees aren't being fired. The problem is also that hiring of NEW employee hiring could be significantly curtailed and wages could stagnate. Not to mention how this would affect local businesses. AMZN is a major employee during holiday season. Would be interesting how things work out going forward.

krapp 9y ago

They need the temp workers during peak seasons - they can't really afford to not hire them, nor can they afford to keep on that many longer-term employees.

mikeyouse 9y ago
"Afford" is a very relative term. They don't want to be responsible for that many FTEs but with $48 billion in gross margin and $2.5 billion in net income, they can certainly afford to employ a few thousand seasonal workers year round.
- krapp 9y ago
  That's true. Amazon has "frugality" as a core cultural value - a valid definition of "can't afford it" for them is "just don't want to pay for it."
  - FussyZeus 9y ago
    In my experience, this doesn't make them that different from virtually any corporation. I don't think I've ever worked for one where getting money for literally anything wasn't a constant uphill battle (which incidentally is why so many consumer electronics feel cheap as shit; they are).
    - microcolonel 9y ago
      > In my experience, this doesn't make them that different from virtually any corporation. For that matter, not any different from a typical person. Expenses that you would be better off not incurring are, by definition, frivolous. In the case of Amazon, frivolous spending at any level changes the price at which they can achieve a fair margin and reduces customer satisfaction.
      - FussyZeus 9y ago
        Except Corporations take it to a uniquely stupid level; things like refusing to pay adequately for internal support, security, auditing, i.e. anything that doesn't have a direct impact on customers.
        microcolonel 9y ago
        Who are you to say what is the right amount to pay for security? Do you know how much life insurance I should have?
        FussyZeus 9y ago
        Every year I need to have usually a 2 hour meeting with my superiors to argue for renewing our antivirus for our Windows infrastructure. Their constant argument every time is "we have no viruses, why do we spend money on this" and I have to tell them every single time "that you're paying for it is WHY we don't have viruses." They have no idea what viruses are, what malware is, what ransomware is and despite being hired to maintain infrastructure, I must continuously explain my decisions to people who do not maintain infrastructure and wouldn't know how with a gun to their head. This, to me, is stupid.
        microcolonel 9y ago
        Fair enough, but at the end of the day you do convince them, which is why they pay for you. ;- )
        9y ago
  - im3w1l 9y ago
    If they can't, then that's the end of that. If they just don't want to, they can be strongarmed.
    - killjoywashere 9y ago
      Are you suggesting they should be strong-armed into employing underutilized employees? Perhaps we could do that for the finance industry too. Really, by that logic, any company making money should be strong armed into excess hiring. I suppose they could also push for increased wages instead, which seems more tenable once you get close to full employment.
  - skookumchuck 9y ago
    Isn't that true for all of us?
- asddddd 9y ago
  > a few thousand seasonal workers year round. You're vastly underestimating what sort of effects "peak season" has. UPS hires 95,000 temporary employees each year; FedEx hires 50,000. Amazon hires 120,000. Retail scales up similarly, but I'm less familiar with the industry. "A few thousand" is how much single distribution centers scale up employment.
  - mikeyouse 9y ago
    I think you're vastly underestimating how much money Amazon makes. So Amazon currently hires 120,000 people at $12/hr for 10 weeks for a total cost of somewhere near $576M. This counts as COGS and is included in their gross margin. If we just multiply that figure by (52 / 10) and subtract out the $576M, we can see that it would decrease their annual Gross Margin by $2.5B. Add on an additional 30% of the combined $3B in salary expense since I doubt the temp workers get benefits, and you'd be looking at a total of ~$3.4 billion. So in 2016, this would've changed their gross income from $47.7 (35% GM) billion to $44.3 billion (32.5% GM).
    - Veelox 9y ago
      That $3.4 billion puts their net income negative for the year negative.
      - mikeyouse 9y ago
        Right, but net income is a fiction to begin with. It has almost nothing to do with a company's actual health. Last year was the first year that Amazon ever showed a NI over a few hundred million (for most of their life, it's been negative). https://a16z.com/2014/09/05/why-amazon-has-no-profits-and-why-it-works/ https://a16z.com/2014/09/05/why-amazon-has-no-profits-and-wh...
- sol_remmy 9y ago
  Your saying they should employ a "few thousand workers" unnecessarily from January - October for moral reasons I wonder if you would still act so idealistically if you held stock in the company..
  - mikeyouse 9y ago
    I wasn't saying they should employ them for moral reasons, I was saying that they absolutely could afford to do so. Side note; I do hold stock in the company, and because I'm not an asshole, I do think they should rely less on temp labor and they should improve working conditions for their existing warehouse workers. Even if it reduces my capital gains by some fraction of a percent.

dogruck 9y ago

Certainly might be a native ad. Do you have any data to support your thesis of net job loss correlated to increased automation?

microcolonel 9y ago

> Trying to sell it like no jobs are lost is quite naive at best, and purposefully misleading at worst. Well, the article does literally say "No people were laid off when the robots were installed, and Amazon found new roles for the displaced workers, Mr. Clark said.". Either Mr. Clark is lying, or this point is moot.

sokoloff 9y ago
I'm not following. Suppose they "normally" ran 150 full time employees and 150 temp workers for holiday peak. Suppose they have a 25% attrition rate. (37 of those 150 employees quit voluntarily.) After the robots, they could have 115 employees working and still not laid anyone off. Yet, in terms of full time employment, they went from 150 to 115 and in terms of temp labor went from 150 to 0. Did the robots destroy jobs in such a case? I'd think "yes". (I still support the deployment of robots in such cases; I'm only responding to the logical argument here, not the philosophical implications thereof.)
- microcolonel 9y ago
  > Suppose they have a 25% attrition rate. (37 of those 125 workers quit voluntarily.) Why would they retain employees which they would not rehire (minus wages in place of hiring cost)? They have no obligation to retain these workers, so clearly Amazon's base (non-seasonal) demand for labour increases fast enough to justify retaining them. At the current rate you would expect them to hire more labour, not less. The human jobs described here are still so far beyond current robotic technology that it's likely there will be no easy gains in automation here. Meanwhile, as Amazon's efficiency increases, throughput will also increase, which means demand for labour will continue to increase even if there are marginal increases in automation.
  - vertex-four 9y ago
    > Why would they retain employees which they would not rehire (minus wages in place of hiring cost)? For good relations with the Government which has a goal of decreasing unemployment, and avoiding bad PR in popular media? If you can wait a couple of months to achieve exactly the same outcome with fewer risks, why not. > Meanwhile, as Amazon's efficiency increases, throughput will also increase No, throughput is a function of demand, not efficiency, unless Amazon is currently backlogged.

glangdale 9y ago

Well, it might be the case that no Amazon jobs are lost as a result of this automation - but this won't mean that the increased productivity doesn't cause job losses elsewhere (i.e. in their competition both bricks-and-mortar and online).

Loic 9y ago
The problem is that we are losing the simple jobs. You have a lot of people with a basic education, who could do good simple work. The push for higher level of education kind of work is removing them from the market. In Germany, the net effect is that you thousands of apprentice positions free and at the same time thousands of people looking for such positions. The requirements of today's positions are now to high for many young people. So we have a gap between educated people and worker people which is growing extremely fast. This results in a society which is polarizing itself more and more. This is not good on the long term.
- abpavel 9y ago
  But isn't it simply a misconception? The 10yr statistics doesn't support your argument: https://tradingeconomics.com/germany/unemployment-rate https://tradingeconomics.com/germany/unemployment-rate As an employer, I find it extremely hard to find qualified people, and my entrepreneur friends are having even harder times, with people showing up for their first day of work either drunk, or not at all.
  - Loic 9y ago
    I find it extremely hard to find qualified people. The problem is that a big part of the population is not qualified enough to work and will not be in the future. The 3.7% unemployment rate in Germany is considering something doing a part-time job for less than €400 per month as employed and the long term unemployed people are not part of the stats, the youths are also not in, etc. They are very good at removing many from the stats. If you look at the industrial core of Germany, the Rhein/Ruhr region, you see cities after cities cut in two, one side with 35% of population living from social support and the other side with just 5%. When you "start" your life in the wrong side, you are out of the employment stats right from the start. Note: I am French, living in Gelsenkirchen (such a typical city) and here, we have really hard time finding good engineers even with very good compensation and at the same time we have parts of the city where Doctors without Borders opened a station because the situation is catastrophic.

honestoHeminway 9y ago

Right! This calls for immediate discussion! Completely new motion, eh, that, ah-- that there be, ah, immediate action-- Ah, once the vote has been taken. Well, obviously once the vote's been taken. You can't act another resolution till you've voted on it.. In the-- in the light of fresh information from, ahh, the article--

eighthnate 9y ago

> This feels quite political. It's bloomberg. > Trying to sell it like no jobs are lost is quite naive at best, and purposefully misleading at worst. I agree that it comes off as very cynical and feels like a PR piece for amazon and automation. Also, the problem isn't just that current amzn employees aren't being fired. The problem is also that hiring of NEW employee hiring could be significantly curtailed and wages could stagnate. Not to mention how this would affect local businesses. AMZN is a major employee during holiday season. Would be interesting how things work out going forward.