Something else Amazon delivers

Something else Amazon delivers

Date: 14 Jan 2017 | posted in: Media Coverage, Retail | 0 Facebooktwitterredditmail

Crain’s Chicago Business – January 14, 2017

by Brigid Sweeney

Amazon is shouting from the rooftops that robots and drones aren’t taking over anytime soon. The e-commerce giant is embarking on a (human) hiring spree, both here and across the country, as it races to build out the network of warehouses that enable same-day and next-day deliveries to its tens of millions of Prime members. …

Others, however, say Amazon does not pay competitively and hurts overall employment as it gains market share. The online retailer pays its employees an average of 15 percent less than comparable employers in 11 metro areas based on Bureau of Labor Statistics data, says Stacy Mitchell, co-director of the Institute for Local Self-Reliance, a nonprofit devoted to so-called sustainable community development. Chicago wasn’t one of the areas the institute surveyed, but she says that Amazon fulfillment workers in Kenosha—just over the state line—earned an average of $12.23 an hour, 22 percent less than that area’s average.

Mitchell also takes issue with the fact that Illinois is giving Amazon incentives. The state has committed to a total of $112 million in tax breaks over the next 10 years in exchange for the nine centers and 7,000 jobs. “You’re just paying to eliminate more jobs and lower wages across the retail sector,” she says, adding that Amazon’s job creation is not impressive relative to its revenue. Amazon’s revenue leapt 29 percent to $32.7 billion for the quarter ended Sept. 30. In 2015, its revenue per employee was $464,000, far less than Apple, Facebook, Google or Netflix—all of which generate well over $1 million per employee—but considerably more than that of other retailers. Nordstrom and Wal-Mart, for example, both pull in a little north of $200,000 per person.

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Nick Stumo-Langer
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Nick Stumo-Langer

Nick Stumo-Langer was Communications Manager at ILSR working for all five initiatives. He ran ILSR's Facebook and Twitter profiles and builds relationships with reporters. He is an alumnus of St. Olaf College and animated by the concerns of monopoly power across our economy.