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We have heard a lot of discussions about whether working in an Amazon warehouse should be considered a good or bad job. My colleagues Jodi Kantor, Karen Weise, and Grace Ashford spent months answering another question: How well does Amazon manage all of these people?
They found that Amazon’s systems for mass managing its hourly workforce are strained and uneven, resulting in high employee turnover. I encourage you to read her well-reported research that made me wonder whether Amazon’s handling of arguably its most important asset – its roughly one million US employees, mostly hourly workers – is effective or sustainable for the company, let alone for it these people .
I spoke with Karen about what she and her co-workers have learned and where Amazon’s reputation for excellence contradicts the chaos of managing its people.
Shira: They found that Amazon had to replace more than the equivalent of its entire hourly workforce in a single year. It’s breathtaking. Is Amazon ousting them or giving them notice?
Karen: Both. Amazon hires so many people, often with no face-to-face interviews or scrutiny, and loses a significant number of people within the first few weeks of being hired. We have heard of people who take their lunch break on their first day of orientation. This leads to enormous fluctuation and some chaos in the workplace.
We also wrote about an employee named Dayana Santos who was praised by managers and then fired for a bad day when she was inconsistent with production for various reasons. She is someone the company should have kept. Amazon has since changed the policies that led to their layoffs, but the example shows that the company has developed systems that are not always effective in judging who a capable worker is.
Is the high turnover rate wanted?
David Niekerk, a former Amazon vice president who built the warehouse’s human resources department, said Jeff Bezos didn’t want long stints for hourly workers. Company data showed that employees became less engaged over time, and Amazon looked for employees who pushed themselves to go beyond that.
Maybe Amazon doesn’t want to leave so many people every year, but changing that isn’t the number one priority either. Amazon ransacks so many employees that I’ve heard from numerous Amazon executives in Seattle that they have a nagging fear that the company will run out of Americans to hire them.
What does Amazon say about it?
Amazon told us that labor turnover is just a metric that is not relevant without context. The company did not provide any information. Company officials didn’t say it’s unacceptable to have 150 percent sales in one year.
Let’s be honest about the dollars and cents. Doesn’t it cost Amazon a lot of money to replace so many people?
It is. And a crucial – perhaps the most important – factor for the future growth of Amazon is not the success of futuristic inventions like delivery drones or home robots. That’s how effectively Amazon manages the people who pick, pack, and ship all of these boxes to our doors.
Technology companies speak of “moonshots” or the seemingly impossible. With Alexa, the company started with a vague idea, but put its best people on the project, set itself incredibly ambitious goals, and found out. Some company-level Amazon executives and those overseeing the warehouses wonder why managing more than a million people wasn’t this type of high-priority moonshot.
Bezos wrote in April that he wanted to make Amazon the “best employer in the world and the safest workplace in the world”. What does he mean? And what measures is Amazon taking?
Amazon has talked about the security part, but not as much about the other half of Bezos’ testimony. Being a great place to work means more than just paying, although recently Amazon has been increasing hourly wages and paying new hire bonuses.
After inquiring about the company’s policies, Amazon also changed its use of a productivity metric that some employees said had been applied arbitrarily. Somebody can’t be fired for a bad day anymore. (Amazon said it had been rethinking the policy for months.)
Are there any successful companies that manage hourly workers differently than Amazon?
Costco’s CEO told Congress that its hourly workers typically have long hours of service. That makes Costco proud.
Often criticized for its work practices, Walmart generally pays less than Amazon, but it says more than 75 percent of managers in its U.S. branches started out as hourly workers. It’s extremely difficult to take that leap on Amazon.
Sam’s Club, owned by Walmart, trains workers to do multiple jobs in one store. Part of this is to make people feel fresh in their jobs and learn new skills. Amazon warehouse workers can do the same type of work every day in 10-hour shifts.
Before we go …
Cyber attacks are high on the foreign policy agenda: My colleague David E. Sanger explains why digital hacking was high on the agenda at President Biden’s Wednesday meeting with Russian President Vladimir Putin. The “deterrents that maintained a troubled nuclear peace during the Cold War will not work against digital threats,” writes David.
What happened when Nigeria banned Twitter: After the government suspended Twitter this month, BuzzFeed News spoke to Nigerians who felt they had lost a lifeline to speak out, connect and organize protests against inequality and violence.
We are the gadget guinea pigs: Amazon is experimenting with selling devices to see how people react to them, like Alexa glasses and buttons to reorder items like toilet paper. My colleague Brian X. Chen writes about the benefits and risks of Amazon’s research and development to the public. (I wrote about the difference between worthy real-world testing of new products and reckless testing last month.)
Esme the cat is a delightful thief. An Oregon woman set up a clothesline in her yard so her neighbors can retrieve gloves, masks, bathing suits, and other items Esme stole from them.