Amazon is having a tough time dealing with the labor shortage, primarily in its warehouses. That’s why, in last week’s earnings call, the company announced that it would be raising the price of Prime by $20 a year.
But it's also grappling with hiring and retaining corporate workers, so it's raising their maximum base pay from $160,000 to $350,000.
The move, which GeekWire first reported Monday, came as the company has been under fire for lower-than-average corporate salaries. Employees have asked leaders to address salary in company town-hall meetings. And churn has been high: Some sections of the company lost as much as 35% of their staff in 2021.
Though Amazon’s base pay was uncharacteristically low, the labor shortage has given employees at several companies leverage to demand better benefits and pay. Parental leave, employer-provided mental health care and ample vacation time have transitioned from wants to needs, in addition to workers demanding better pay. Recruiters have struggled to keep up across the industry — about 50% of Facebook recruits turned down job offers in the first quarter of 2021, for example.
Pay transparency is on the rise, too. Tools like levels.fyi and salary calculators help tech workers directly negotiate salary in comparison to their peers. Without raising pay, Amazon risked losing staff to its competitors.
According to a post on Amazon’s internal corporate site, the company will adjust compensation during the employee performance review process.