Amazon announced Wednesday that it will raise its starting pay for frontline workers from $18 up to $19 an hour. This could help it attract more workers in a tight labor market, as the holiday season approaches.
Amazon said that beginning in October, warehouse and transportation workers would earn between $16 and $26 an hour, depending on their position and location in the U.S. The minimum wage at the Seattle-based e-commerce company, which employed roughly 1.5 million frontline workers as of the end of June, will remain $15 an hour.
The pay raise follows an announcement from Amazon that it will hold a Prime-Day like holiday shopping event in October, the first time it is having a major sales drive twice in a year, following its Prime Day deals event in July. Target and Walmart announced last week that they will offer holiday deals and gift returns in October to help cash-strapped customers who plan to shop earlier and spread their holiday spending. The pay bump is being offered by the company amid growing unionization movements in its warehouses. This movement has been fueled by worker complaints about working conditions and pay. Next month, Amazon warehouse workers in upstate New York will vote in a union election following an organizing drive spearheaded by the Amazon Labor Union, the grassroots group of former and current Amazon workers who pulled off a union win at a Staten Island warehouse in April. The union lost another election at a nearby warehouse.
Amazon had increased its hourly average pay to $18 an hr last year. According to Amazon, the new raise will cost them $1 billion over the next year.
Separately, the company said its pay access program, Anytime Pay, will also change to allow employees to get paid more than once or twice a month.
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