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Why did Jeff Bezos really raise Amazon’s wages?

By Yair Oded

Oct 5, 2018


In a somewhat startling move, Amazon announced this week that it will raise the minimum wage for all its U.S. employees to $15 an hour. The new wage, which goes into effect Nov. 1, will affect both full time and part-time employees (which together total over 300,000), as well as workers contracted temporarily for busy seasons. Amazon’s outpouring of generosity was the result of a long and persistent campaign led by U.S. Senator Bernie Sanders to improve the working conditions for Amazon employees after numerous reports indicated they were subject to harsh treatment and earned meagre wages. Amazon’s CEO, Jeff Bezos, has urged other major conglomerates to follow in his footsteps and declared that his company will lobby to raise the federal minimum wage to $15. Bezos’ decision to raise wages in the U.S. certainly constitutes a step in the right direction. One must wonder, though—is it too soon to jump with excitement? What lies behind Amazon’s move and, considering its motives, is it unreasonable to assume the fight for fair treatment of its workers is far from being over?

Alarmed by articles regarding the horrid working conditions of Amazon workers across the country, including an Intercept report indicating that many Amazon employees in the U.S. can’t make ends meet and rely on Medicare and food stamps to survive, Sanders introduced what he named the “Stop Bezos Act” to the U.S. Senate. The bill was aimed at levying high taxes on companies whose employees rely on federal assistance to get by. Sanders embarked on a nationwide campaign, meeting with hundreds of Amazon employees in order to communicate their plight. Sanders was joined by several unions and media organisations, such as The Young Turks, who utilised their platforms and resources to support Sanders’ crusade. As their efforts prompted the online retailer to raise wages across the nation, Sanders took to Twitter to congratulate Bezos, stating “What Mr Bezos has done today is not only enormously important for Amazon’s hundreds of thousands of employees, it could well be a shot heard around the world. I urge corporate leaders around the country to follow Mr. Bezos’ lead.” Sanders’ laudatory remarks won the attention of Bezos, who Tweeted back, “Thank you @SenSanders. We’re excited about this, and also hope others will join in.”

While it’s absolutely marvellous that everyone is excited, let us delve deeper for a moment and try to understand Bezos’ incentive for raising his American workers’ wages and the context within which he did it. Amazon, as well as Bezos specifically, were deluged with swarms of negative press criticising the appalling, and often inhumane, conditions of their workers around the world. Many, including high ranking politicians, unions, and media outlets, called out the company for paying insufficient wages to its employees while garnering unimaginably large profits. Such negative coverage could potentially threaten some of Bezos’ aspirations in the immediate future, one of which is hiring a large number of temp workers for the holiday season (a task that’s growing increasingly difficult seeing as the unemployment rate in the U.S. has dropped to under four percent and the market is tight). Another short-term goal of Bezos is establishing the company’s new headquarters in a U.S. city of his choosing and winning massive tax breaks in exchange for supplying multiple high paying jobs. Aligning himself with a progressive agenda and improving his and his company’s image comes in handy at such a critical juncture for the company.

Hours after the announcement was made, Amazon’s Senior Vice President, Dave Clark, uploaded a video to Twitter in which he is seen raised above a crowd of Amazon employees, all of whom roar and jump with ecstasy as he delivers the news to them. In his interview for The Young Turks, Sanders comments on the heartwarming excitement exhibited by the employees, which he regards as an attestation to the awesomeness of this development. There is no doubt that Bezos’ decision constitutes an improvement and an important step forward in the fight for fair treatment of workers, and that such a wage increase would be life changing for hundreds of thousands of his employees. Yet, the sight of Amazon’s SVP hovering over a crowd of workers resembles that of a lord informing his serfs he’s kindly decided to improve their conditions and reveals a key problem in the dynamics between large companies and their employees. Providing a decent living wage should not be viewed as an act of great generosity or charity or heroism, for it’s every worker’s right to lead a life of dignity. Bezos should therefore not be portrayed as a martyr for simply doing the right thing, for a change.

Let us also remember that the increase in wage announced this week does not alleviate the plight of hundreds of thousands of Amazon workers across the globe, who still work under harsh conditions for scanty wages, and who often don’t have local representatives and unions fighting on their behalf. Finally, we mustn’t forget that we cannot lean back and read such news as external spectators who have nothing to do with the issue, for we are the ones who continuously stuff the full-to-the-brim pockets of Amazon and Jeffrey Preston Bezos.