After a political squeeze, Jeff Bezos buckled under the demands for higher wages
An FKD Feature exclusive

The rumors are true. Amazon is raising the minimum wage to $15 an hour for more than 350,000 employees (including the seasonal employees it plans to hire for the holiday season). CEO Jeff Bezos, in a press release, said that “We listened to our critics, thought hard about what we wanted to do, and decided we want to lead.” He further mentioned that “We’re excited about this change and encourage our competitors and other large employers to join us.”

Opinions about Amazon

The results on other retailers of online shopping has begun to be a bit of a thorn in the side of Bezos and Amazon. Despite its massive success, Amazon’s online game has prompted many to criticize them for “hurting traditional retailers” as President Donald Trump has said, and forcing retailers like Toys “R” Us and Sears to shut down or lay off workers. And yet, Amazon now employs 575,000 people, which they cite as somewhat contradicting the idea that Amazon is bad for workers.

But the considerations over what Amazon pays its workers has recently come under a fierce magnifying glass in light of Amazon’s CEO Jeff Bezos’ massively growing fortune. For instance, Amazon’s market capitalization passed $1 trillion last month. And Jeff Bezos, with a net worth of $165 billion, is now the richest person in the world, according to the Bloomberg Billionaires Index. The problem is that many of the jobs at Amazon, like warehouse workers and those that make the actual door deliveries, are paid very low wages.

“I think they saw the calculation that it was indefensible that a man whose wealth is over $150 billion be able to continue paying workers’ wages that are so low that they are forced to rely on federal benefits,” Sen. Bernie Sanders of Vermont said in an interview after the announcement. “Smart people are willing to change course.”

Amazon bends to public demand

Although as recently as last month Amazon was resisting pressure to raise wages, Bezos has since raised pay almost immediately to $15, prompting Sanders to praise Bezos’ move on Twitter. “That is bold, no question about it,” Sanders said. Bezos thanked Mr. Sanders on Twitter for praising the change. “We’re excited about this, and also hope others will join in,” Bezos wrote.

The Fight For $15 campaign considers Amazon’s switch a major victory for their cause. A fifth of the population of the United States now lives in a state with a minimum wages that is $15.

“Workers worldwide have been standing up, joining together, and winning!” the organization said in a message on Twitter. “Amazon is just the latest company to respond.”

Further considerations

This wage increase comes as the company plans to announce the location of its second headquarters before the end of the year. The new location is expected to employ 50,000 highly paid technology workers.

The decision for Amazon to pay higher wages may also encourage other companies to ratchet up their wages. “Once you’re paying a higher wage, you tend to want your competitors to also pay a higher wage,” Professor Alan Manning, an economics professor at the London School of Economics told The New York Times. “If your costs are going up, you’d also quite like your rivals’ costs to go up as well.”

The representative of Amazon declined to comment on how it plans to push for a higher federal minimum wage. But the business has, in recent years, built one of the largest lobbying teams in Washington, spending $13 million last year. Even if the higher wage issue does not pass, it is still likely that the push will become a campaign issue. This is what Sanders believes. Bezos’s “decision today is going to have a ripple effect to other corporations and other cities and states,” he said to the New York Times.


Amazon’s decision to pay its employees a higher minimum wage is laudable even if it was done under pressure. Other companies are already following suit. And, in general, the minimum wage for retail workers, traditionally a low paying position, has been inching up. Laudable as it may be for Bezos to push for a higher minimum wage, is it really so much to expect the richest man in the world to champion a cause such as fairer wages for its employees?


Have something to add to this story? Comment below or join the discussion on Facebook.

Header image: ShutterStock


Posted 10.24.2018 - 11:00 am EDT