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That’s a fair point. I see them as suppressing wages because they open warehouses in small towns, pay $15/hr and then work the person to death so they become de

That’s a fair point. I see them as suppressing wages because they open warehouses in small towns, pay $15/hr and then work the person to death so they become dependent on that job. Amazon can totally dominate an area’s workforce and use that to drive wages and benefits down.

jaredklewis 5y ago
This argument sounds entirely theoretical. Do you have an example of even one small town where average or median wages or benefits were decreased as a result of Amazon? I frequently encounter armchair economists on the Internet making sweeping claims about various, but it is frustrating. It takes basically no effort to think up something plausible. But to take even the first step towards empirically verifying a given hypothesis is an enormous amount of work. Without even a rough empirical foundation, how valuable are these armchair theories? A little dated now but the Economist had a little mini-article about Amazon and wages. Really highlights how difficult it is to draw any definitive causal links, as well as trade offs (like benefits and unemployment): https://www.economist.com/united-states/2018/01/20/what-amazon-does-to-wages https://www.economist.com/united-states/2018/01/20/what-amaz...
- jfim 5y ago
  > Do you have an example of even one small town where average or median wages or benefits were decreased as a result of Amazon? A couple of quotes from https://www.nytimes.com/2021/03/18/business/economy/amazon-wages-alabama-union.html https://www.nytimes.com/2021/03/18/business/economy/amazon-w... In making the case against a union at its warehouse in Bessemer, Ala., Amazon has touted its compensation package. The company notes that base pay at the facility, around $15.50 an hour for most rank-and-file workers, is more than twice the local minimum wage, and that it offers comprehensive health insurance and retirement benefits. But to many of Amazon’s Bessemer employees, who are voting this month on whether to unionize, the claims to generosity can ring hollow alongside the demands of the job and local wage rates. The most recent figure for the median wage in greater Birmingham, a metropolitan area of roughly one million people that includes Bessemer, was nearly $3 above Amazon’s pay there, according to the Bureau of Labor Statistics. But other workers emphasize that pay at Amazon isn’t particularly high for the Birmingham area, even if the pandemic has reduced their job options. The retail workers’ union said it represented employees at nearby warehouses where pay is $18 to $21 an hour, including an ice cream facility and a grocery warehouse not far from Amazon.
  - jaredklewis 5y ago
    I think these are interesting points (though a union in a standoff with Amazon isn't a great source for information), but I don't find them very convincing For example, it is not surprising that amazon warehouse workers, an unskilled job with minimal required training, make less than a median wage. For example, the average salary of a warehouse worker in Los Angeles (where I live) is $38k/year. The average salary of a paralegal is $45k/year. This is unsurprising. I am not saying that warehouse work is easier than paralegal work, but I am saying that this phenomenon has nothing to do with Amazon. Further, it is worth noting that Amazon Warehouse jobs are unlike most many other warehouse jobs. Being able to use a pallet jack or forklift is a skill and that workers with those skills can command higher wages than workers without those skills is again unsurprising. I think it is hard to objectively analyze the situation by taking talking points from a union in a confrontation with Amazon. $18-$21 with what kind of benefits? For what kind of labor?
  - 8note 5y ago
    Important to note: the vote result was already tallied to not unionize
- gimmeThaBeet 5y ago
  bloomberg had an article along similar lines late last year. The main hypothesis isn't terribly controversial to me, amazon lowers logistics wages since it pays less than the traditional players, and has sort of the 'business gravity' to immediate move in and be a significant employer. I would not call that suppressing wages on its own. Amazon's argument is that they aren't driving wages down, they are raising them up because their employees are not from traditional logistics, but most retail and service jobs, again, on its own, probably more right than not. That's the thing I think is hard to separate, and I want to know more about. These industries feel threatened by amazon, so where is that coming from? Is it all just business muscle and monopsony, or is there genuine disruption (even in something that relies on amazon's scale)? Sort of a competitively 'legitimate' advantage. And I would say that you can definitely discuss if they are externalizing societal costs with how they treat employees. It's not a direct comparison, but I think about the crafts that were overtaken by factories. I think it can't be that simple, but amazon clearly changed the labor dynamics, so what did it do and how did it do it? https://www.bloomberg.com/news/features/2020-12-17/amazon-amzn-job-pay-rate-leaves-some-warehouse-employees-homeless https://www.bloomberg.com/news/features/2020-12-17/amazon-am...
  - jaredklewis 5y ago
    Yea, if the argument is that amazon drives wages lower because Amazon took a skilled job (forklift operator) and turned it into an unskilled job anyone can do, then I agree with that premise. I just think it is misleading to call that wage suppression as that is not how the term is traditionally used. Operating a loom probably does take less skill than knitting fabric by hand, but that's not wage suppression; that's just creative destruction. With that definition of wage suppression, pretty much every app, piece of software, or other innovation is suppressing wages.
    - judge2020 5y ago
      > forklift operator I get where you're coming from (there are other logistics-related specialty jobs), but i've heard that Amazon designs their warehouses around not needing forklifts (except in very few areas0 since they're incredibly dangerous in general.
UnpossibleJim 5y ago
One more reason to decouple Americans healthcare from their employment ... and yes, I am a broken record =)
MeinBlutIstBlau 5y ago
In Road to Wiggan Pier, George Orwell wrote that the worst housing available to people weren't the major corporations or business that owned numerous properties, but the petty landlords. The ones who barely could afford upkeep. We also noticed that after the Land Consolidation Act in Britain that food outputs shot up enormously so as not to waste peoples time being minor farmers who toiled a lot for little in comparison to major institutions that could create much larger outputs at a fraction of the effort. What I'm getting at is, small towns and the like tend to be dominated by petty landlords and what have you. Or someone wealthier elsewhere that can fund endeavors there because they can't where they live. The unfortunate aspect is like the events George Orwell stated. Lots of rundown or lesser paying places. The notion that consolidation of markets is somehow bad because it drives down people's autonomy has been around for ages and all we've seen time and time again that it actually benefits people more often than it doesn't. You don't have to worry about crop yields, you worry about a boring office job. You don't have to worry about house maintenance, just who to call to fix these complex things. It allows for people to specialize in fields instead of making a population of "Jack of All Trades." The latter make for a better system when you're predominantly agrarian. The former is better when you've got a system so complex that you need people to hyper specialize in something specific so they don't have to worry about other minutia work.
- tharkun__ 5y ago
  I could get behind some of this but we have to keep some things separate. Specialization is great. Economies of scale make certain things possible. Awesome. That doesn't mean you have to consolidate power for each of these things with just one big overlord. I don't agree with the house maintenance for example. Many many renters have a really hard time to get their landlords big and small to fix things. Or make them nice. And you can't do stuff on your own. Want a mini split AC/heat exchanger? Gotta ask the landlord. A large corporation that doesn't want to do this or even listen to you. They'd have to install this for the entire apartment block if they do. A large expense. Now you gotta get all the 50 neighbors to petition as well to get anything moving. And the corp knows they gotta increase the rent if they do this for you but then you will complain about the rent increase later. The same can apply to individual petty landlords abviously. As a homeowner I already can make use of the benefits of specialization by calling on someone that specializes in HVAC to help me choose whether a mini split makes sense, which models are out there, install it properly etc. Or I can do parts of this, like the research myself or even the installation if I have the expertise.
ekianjo 5y ago
> then work the person to death so they become dependent on that job. Any evidence for this? Especially in COVID times when there's massive unemployment checks programs, if that were remotely true nobody would be working for Amazon right now.
- judge2020 5y ago
  Most Amazon warehouse employees will attest to how much you're tracked in terms of performance numbers and how taking micro breaks[0] is discouraged or punished. And $15/hr is still generally more than most employment, with the state average maximum individual unemployment being $2042 a month [1] and Amazon paying minimum $2600 a month (in terms of full-time), which might make or break the bank for many Amazon employees. 0: https://ehs.stanford.edu/subtopic/microbreaks https://ehs.stanford.edu/subtopic/microbreaks 1: https://savingtoinvest.com/maximum-weekly-unemployment-benefits-by-state/ https://savingtoinvest.com/maximum-weekly-unemployment-benef...
  - ekianjo 5y ago
    > Most Amazon warehouse employees will attest to how much you're tracked in terms of performance numbers What is the turnover rate? Because if you hate your job every single day no amount of money will make you stay.
    - judge2020 5y ago
      https://www.nytimes.com/interactive/2021/06/15/us/amazon-workers.html https://www.nytimes.com/interactive/2021/06/15/us/amazon-wor... > Even before the pandemic, previously unreported data shows, Amazon lost about 3 percent of its hourly associates each week, meaning the turnover among its work force was roughly 150 percent a year. That rate, almost double that of the retail and logistics industries, has made some executives worry about running out of workers across America.
      - ekianjo 5y ago
        then is there any issue? it means workers find better opportunities or better conditions elsewhere.
lupire 5y ago
They don't drive down hourly wages, they drive down wages per effort and health cost.

jaredklewis 5y ago

This argument sounds entirely theoretical. Do you have an example of even one small town where average or median wages or benefits were decreased as a result of Amazon? I frequently encounter armchair economists on the Internet making sweeping claims about various, but it is frustrating. It takes basically no effort to think up something plausible. But to take even the first step towards empirically verifying a given hypothesis is an enormous amount of work. Without even a rough empirical foundation, how valuable are these armchair theories? A little dated now but the Economist had a little mini-article about Amazon and wages. Really highlights how difficult it is to draw any definitive causal links, as well as trade offs (like benefits and unemployment): https://www.economist.com/united-states/2018/01/20/what-amazon-does-to-wages https://www.economist.com/united-states/2018/01/20/what-amaz...

jfim 5y ago
> Do you have an example of even one small town where average or median wages or benefits were decreased as a result of Amazon? A couple of quotes from https://www.nytimes.com/2021/03/18/business/economy/amazon-wages-alabama-union.html https://www.nytimes.com/2021/03/18/business/economy/amazon-w... In making the case against a union at its warehouse in Bessemer, Ala., Amazon has touted its compensation package. The company notes that base pay at the facility, around $15.50 an hour for most rank-and-file workers, is more than twice the local minimum wage, and that it offers comprehensive health insurance and retirement benefits. But to many of Amazon’s Bessemer employees, who are voting this month on whether to unionize, the claims to generosity can ring hollow alongside the demands of the job and local wage rates. The most recent figure for the median wage in greater Birmingham, a metropolitan area of roughly one million people that includes Bessemer, was nearly $3 above Amazon’s pay there, according to the Bureau of Labor Statistics. But other workers emphasize that pay at Amazon isn’t particularly high for the Birmingham area, even if the pandemic has reduced their job options. The retail workers’ union said it represented employees at nearby warehouses where pay is $18 to $21 an hour, including an ice cream facility and a grocery warehouse not far from Amazon.
- jaredklewis 5y ago
  I think these are interesting points (though a union in a standoff with Amazon isn't a great source for information), but I don't find them very convincing For example, it is not surprising that amazon warehouse workers, an unskilled job with minimal required training, make less than a median wage. For example, the average salary of a warehouse worker in Los Angeles (where I live) is $38k/year. The average salary of a paralegal is $45k/year. This is unsurprising. I am not saying that warehouse work is easier than paralegal work, but I am saying that this phenomenon has nothing to do with Amazon. Further, it is worth noting that Amazon Warehouse jobs are unlike most many other warehouse jobs. Being able to use a pallet jack or forklift is a skill and that workers with those skills can command higher wages than workers without those skills is again unsurprising. I think it is hard to objectively analyze the situation by taking talking points from a union in a confrontation with Amazon. $18-$21 with what kind of benefits? For what kind of labor?
- 8note 5y ago
  Important to note: the vote result was already tallied to not unionize
gimmeThaBeet 5y ago
bloomberg had an article along similar lines late last year. The main hypothesis isn't terribly controversial to me, amazon lowers logistics wages since it pays less than the traditional players, and has sort of the 'business gravity' to immediate move in and be a significant employer. I would not call that suppressing wages on its own. Amazon's argument is that they aren't driving wages down, they are raising them up because their employees are not from traditional logistics, but most retail and service jobs, again, on its own, probably more right than not. That's the thing I think is hard to separate, and I want to know more about. These industries feel threatened by amazon, so where is that coming from? Is it all just business muscle and monopsony, or is there genuine disruption (even in something that relies on amazon's scale)? Sort of a competitively 'legitimate' advantage. And I would say that you can definitely discuss if they are externalizing societal costs with how they treat employees. It's not a direct comparison, but I think about the crafts that were overtaken by factories. I think it can't be that simple, but amazon clearly changed the labor dynamics, so what did it do and how did it do it? https://www.bloomberg.com/news/features/2020-12-17/amazon-amzn-job-pay-rate-leaves-some-warehouse-employees-homeless https://www.bloomberg.com/news/features/2020-12-17/amazon-am...
- jaredklewis 5y ago
  Yea, if the argument is that amazon drives wages lower because Amazon took a skilled job (forklift operator) and turned it into an unskilled job anyone can do, then I agree with that premise. I just think it is misleading to call that wage suppression as that is not how the term is traditionally used. Operating a loom probably does take less skill than knitting fabric by hand, but that's not wage suppression; that's just creative destruction. With that definition of wage suppression, pretty much every app, piece of software, or other innovation is suppressing wages.
  - judge2020 5y ago
    > forklift operator I get where you're coming from (there are other logistics-related specialty jobs), but i've heard that Amazon designs their warehouses around not needing forklifts (except in very few areas0 since they're incredibly dangerous in general.

UnpossibleJim 5y ago

One more reason to decouple Americans healthcare from their employment ... and yes, I am a broken record =)

MeinBlutIstBlau 5y ago

In Road to Wiggan Pier, George Orwell wrote that the worst housing available to people weren't the major corporations or business that owned numerous properties, but the petty landlords. The ones who barely could afford upkeep. We also noticed that after the Land Consolidation Act in Britain that food outputs shot up enormously so as not to waste peoples time being minor farmers who toiled a lot for little in comparison to major institutions that could create much larger outputs at a fraction of the effort. What I'm getting at is, small towns and the like tend to be dominated by petty landlords and what have you. Or someone wealthier elsewhere that can fund endeavors there because they can't where they live. The unfortunate aspect is like the events George Orwell stated. Lots of rundown or lesser paying places. The notion that consolidation of markets is somehow bad because it drives down people's autonomy has been around for ages and all we've seen time and time again that it actually benefits people more often than it doesn't. You don't have to worry about crop yields, you worry about a boring office job. You don't have to worry about house maintenance, just who to call to fix these complex things. It allows for people to specialize in fields instead of making a population of "Jack of All Trades." The latter make for a better system when you're predominantly agrarian. The former is better when you've got a system so complex that you need people to hyper specialize in something specific so they don't have to worry about other minutia work.

tharkun__ 5y ago
I could get behind some of this but we have to keep some things separate. Specialization is great. Economies of scale make certain things possible. Awesome. That doesn't mean you have to consolidate power for each of these things with just one big overlord. I don't agree with the house maintenance for example. Many many renters have a really hard time to get their landlords big and small to fix things. Or make them nice. And you can't do stuff on your own. Want a mini split AC/heat exchanger? Gotta ask the landlord. A large corporation that doesn't want to do this or even listen to you. They'd have to install this for the entire apartment block if they do. A large expense. Now you gotta get all the 50 neighbors to petition as well to get anything moving. And the corp knows they gotta increase the rent if they do this for you but then you will complain about the rent increase later. The same can apply to individual petty landlords abviously. As a homeowner I already can make use of the benefits of specialization by calling on someone that specializes in HVAC to help me choose whether a mini split makes sense, which models are out there, install it properly etc. Or I can do parts of this, like the research myself or even the installation if I have the expertise.

ekianjo 5y ago

> then work the person to death so they become dependent on that job. Any evidence for this? Especially in COVID times when there's massive unemployment checks programs, if that were remotely true nobody would be working for Amazon right now.

judge2020 5y ago
Most Amazon warehouse employees will attest to how much you're tracked in terms of performance numbers and how taking micro breaks[0] is discouraged or punished. And $15/hr is still generally more than most employment, with the state average maximum individual unemployment being $2042 a month [1] and Amazon paying minimum $2600 a month (in terms of full-time), which might make or break the bank for many Amazon employees. 0: https://ehs.stanford.edu/subtopic/microbreaks https://ehs.stanford.edu/subtopic/microbreaks 1: https://savingtoinvest.com/maximum-weekly-unemployment-benefits-by-state/ https://savingtoinvest.com/maximum-weekly-unemployment-benef...
- ekianjo 5y ago
  > Most Amazon warehouse employees will attest to how much you're tracked in terms of performance numbers What is the turnover rate? Because if you hate your job every single day no amount of money will make you stay.
  - judge2020 5y ago
    https://www.nytimes.com/interactive/2021/06/15/us/amazon-workers.html https://www.nytimes.com/interactive/2021/06/15/us/amazon-wor... > Even before the pandemic, previously unreported data shows, Amazon lost about 3 percent of its hourly associates each week, meaning the turnover among its work force was roughly 150 percent a year. That rate, almost double that of the retail and logistics industries, has made some executives worry about running out of workers across America.
    - ekianjo 5y ago
      then is there any issue? it means workers find better opportunities or better conditions elsewhere.

lupire 5y ago

They don't drive down hourly wages, they drive down wages per effort and health cost.