Amazon Beats Walmart and Target in Minimum Wage Race

Here's what Amazon's minimum wage hike means for you.
  • Amazon will raise its minimum wage to $15 per hour in the U.S. in November 2018.
  • CEO Jeff Bezos announced that Amazon will begin advocating for a federal minimum wage increase.
  • Retail giants are set to follow Amazon’s lead, raising the minimum wage beyond the federal standard of $7.25.

Amazon has been criticized for underpaying its workers and, given the retail titan’s massive global profile, the allegations of mistreatment of workers and low wages drew the attention of U.S. politicians and major news outlets.

CEO Jeff Bezos released a statement on Tuesday, Oct. 2, announcing that on Nov. 1 his company would raise its minimum wage to $15 per hour — up from around $11 per hour — for U.S.-based employees working at Amazon and Whole Foods.

Click to read about Chick-fil-A’s $17 minimum wage and whether it’s sustainable.

What the Minimum Wage Increase Means for Amazon Customers

For Amazon, the $4-per-person raise equates to roughly an additional $1 billion in company spending per year, according to analysts. But don’t think Bezos, the world’s richest man, is coughing up any additional cash: It’s speculated that the company-wide raise is likely being offset by the most recent Prime membership fee hike from $99 to $119 annually for its 100 million-plus members.

Find Out: 7 Brilliantly Slick Ways to Get Amazon Prime for Free

Target and Walmart Among Retailers Increasing Minimum Wages

The country’s largest retailers — including Target, Walmart and Amazon — not only compete for sales and market share but for goodwill publicity. In Bezos’ announcement, he called on rivals and the federal government to raise minimum wages. As of October 2018, the minimum wage at Target is $11 with a promise to raise it to $15 by the end of 2020, and Walmart raised its minimum wage to $11 earlier in 2018.

News of wage hikes by retailers are promising for employees and ethically minded consumers, but the retail giants have to draw on the cash from somewhere. The same day Walmart announced its wage increase, the company said it would lay off thousands of employees in its move to shut over 60 Sam’s Club locations.

See: In-N-Out and 18 Other Companies That Pay Way More Than You Think

Amazon Wage Increase Comes 2 Years After Bloodworth’s Expose

Earlier this year, a bombshell report came out from James Bloodworth, a journalist who went undercover at one of Amazon’s warehouses in the United Kingdom back in 2016. Bloodworth chronicled his experience in his book “Hired: Six Months Undercover in Low-Wage Britain.”

Citing that the e-commerce giant treats “human beings as robots,” Bloodworth’s “demoralizing” and “shocking” allegations against Bezos’ company ranged from his accounts on employees being criticized for taking routine bathroom breaks to a demerit system for workers with infractions that included taking a sick day.

Not All Good News: Amazon Kills Bonuses and Stocks for Workers Right After Increasing Wages

Amazon denied the allegations but addressed that the company no longer employs its demerit system. In its announcement about increasing its minimum wage in the U.S., Amazon also said it would raise its minimum wage in Britain to 10.50 pounds ($13.59) per hour in London and to 9.50 pounds in other parts of Britain on Nov. 1, reported Reuters.

Click to keep reading about cities where you can realistically live on minimum wage.

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