NEW YORK -- Amazon, needing a more tech-savvy workforce, is offering to pay to retrain its employees and help them switch to more technical jobs at Amazon or elsewhere.
The online shopping giant said Thursday that it plans to spend $700 million by 2025 to retrain 100,000 workers, or a third of its U.S. workforce. The initiative could help Amazon find and keep more workers. It will apply across the company, from corporate employees to warehouse workers. With a strong economy and unemployment near a 50-year low, workers have more options, giving employers a tougher time finding help.
"The harder it is to hire workers from the outside, the more sense it makes to invest in training the workers you already have," said Jed Kolko, chief economist at job site Indeed.
Even as Amazon is racing to fill thousands of high-skill jobs at its Seattle headquarters and elsewhere, the company is relying on technology that could threaten jobs performed by workers in the company's warehouses, where automation already plays a central role; devices tell workers which direction to walk to pick up a package from a shelf.
Retraining employees also could help Amazon.com Inc. tame criticism from labor groups and some politicians, including presidential candidates, who say Amazon's order-packing warehouses have poor working conditions. Workers at a Minnesota facility plan to strike next week during the company's busy "Prime Day" shopping event, saying they are not paid enough for the speed at which they're expected to pack boxes.
Workers worldwide have criticized the company's practices, arguing the company's success has benefited shareholders and Amazon's chief executive, Jeff Bezos, the world's richest person, but not those further down the ladder. Amazon pulled out of plans to open a new campus in New York City after the political backlash over the incentives package it negotiated from the city and state.
Amazon has responded to the criticism in part by touting its contributions to the economy and role in providing jobs.
Late last year, Amazon raised the minimum wage for all its U.S. workers to at least $15 an hour.
In the tightest labor market in a half-century, Amazon is competing with other companies to hire the best and brightest and could help sidestep that challenge with a renewed emphasis on training.
Most of the in-house training will be free for Amazon employees, the company said. It will offer several programs, depending on skill and job level. A warehouse worker with no college degree, for example, could be trained to become an information-technology technician who keeps the computers and scanners in a warehouse running smoothly. More high-skilled workers, like those at its Seattle headquarters, could take software engineering classes to switch careers at Amazon or another company.
The company said its fastest-growing skilled jobs over the past five years include data mapping specialists, data scientists, security engineers and logistics coordinators. Amazon said its training effort isn't a response to automation. Since it began using robots it has hired more than 300,000 people; the company now has more than 200,000 robots worldwide.
"While many of our employees want to build their careers here, for others it might be a steppingstone to different aspirations," said Beth Galetti, a senior vice president of human resources at Amazon. "We think it's important to invest in our employees, and to help them gain new skills and create more professional options for themselves."
Major retailers like Walmart and Target have been raising pay and boosting training to lure and retain employees and give shoppers a better in-store experience. While customers are less likely to come face to face with an Amazon worker, the company said having better-skilled employees can help it invent more products and make shopping more convenient for customers. Its Alexa voice assistant, for example, has been a hit for the company, allowing customers to reorder paper towels or play a song by talking to a voice-activated speaker.
Amazon said Thursday that it expects its total U.S. workforce to hit 300,000 this year. Worldwide, it has more than 630,000 employees, making it the second-biggest U.S.-based private employer after Walmart.
The company is hungry for skilled workers. In November, Amazon selected Northern Virginia as the site of a second headquarters as part of an expansion effort to fill open roles near strategic partners. Executives said that the company needed to look beyond Seattle, its longtime home, to fill its need for workers.
There are now more job openings in the country -- 7.4 million -- than there are unemployed Americans -- 6 million -- Amazon said, citing the U.S. Bureau of Labor Statistics.
"The challenge is not just adapting to new technologies, but adapting to the dynamism of the economy, which will only accelerate," said Jason Tyszko, vice president at the U.S. Chamber of Commerce Foundation.
Information for this article was contributed by Joseph Pisani and Michelle Chapman of The Associated Press and by Adam Satariano of The New York Times.
Business on 07/12/2019