Back in September 2021, Amazon made headlines for boosting its average hourly U.S. wage to $18/hour for its warehouse workers. The company had already been paying a starting wage of $15/hour to entry level workers for four years prior.
But in a tight labor market, Amazon still wasn’t competing — on the high end of the pay scale, at least — with other tech companies like Google, Facebook, Apple and Microsoft. On Feb. 7, Amazon announced plans to boost its maximum base pay to $350,000 for corporate and tech employees, GeekWire reported. The news outlet reported that it confirmed the accuracy of the alleged pay raise after viewing an announcement on Amazon’s internal corporate site.
In the past, base pay for execs maxed out at $160,000, with additional income from restricted stock units and cash compensation paid over two years, according to GeekWire. The increase puts the base pay in line with other top tech firms and also makes executive and tech employee pay less volatile since remuneration won’t be tied as closely to stock options. Although Amazon shares jumped on Friday after the company’s fourth-quarter earnings report, they are down from their high of more than $3,700 in July 2021.
Amazon had been struggling with high turnover rates last year as Andrew Jassy prepared to fill Jeff Bezos’ shoes as CEO. Between the beginning of 2020 and April 2021, Business Insider reported, 45 vice presidents and senior executives quit Amazon, creating a turnover rate exceeding 10%.
In the internal memo issued Feb. 7, Amazon said: “This past year has seen a particularly competitive labor market and in doing a thorough analysis of various options, weighing the economics of our business and the need to remain competitive for attracting and retaining top talent, we decided to make meaningfully bigger increases to our compensation levels than we do in a typical year.”
The post also said that Amazon would be “increasing overall compensation ranges for most jobs globally.”
Amazon did not provide GeekWire with an estimate of the increase in total compensation. But in its Q4 report, Amazon profit was down by about $3.5 billion year-over-year, due to higher wages, inflation, and supply chain challenges.
Amazon stock closed down nearly 5% on Feb. 7 and was continuing to drop in pre-market trading Feb. 8.
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