Amazon commits more than $1 billion to raise wages and cut health-care costs for U.S. workers
Pay increases to an average of more than $23 per hour; health-plan contributions cut starting next year as company addresses labor and safety concerns
Amazon said it is investing more than $1 billion to raise wages and lower the cost of health-care plans for its U.S. fulfillment and transportation workers. The Seattle-based company said Wednesday that the average pay is increasing to more than $23 per hour.
Some of Amazon's most tenured employees will see an increase between $1.10 and $1.90 per hour, and full-time employees, on average, will see their pay rise by about $1,600 per year. The wage changes come as the company seeks to balance competitive labor costs with retention amid a tight labor market.
Amazon also said it will lower the cost of its entry health-care plan to $5 per week and $5 for co-pays, starting next year. The reduction will cut weekly contributions by 34% and co-pays by 87% for primary care, mental health and most non-specialist visits for employees using the basic plan. The company did not specify timing for additional health-plan changes beyond the entry plan, but described the shift as part of making health coverage more affordable for workers.
The tech giant and e-commerce leader employs about 1.5 million people worldwide, a scale that makes wage changes meaningful for the labor market. Last December, seven Amazon facilities went on strike in an effort by the Teamsters union to pressure for a labor agreement during what is typically a busy shopping period. In the same month, Amazon reached a settlement with the Occupational Safety and Health Administration that requires it to adopt corporate-wide ergonomic measures at facilities across the country, after the agency cited hazardous working conditions that led to serious lower-back and other musculoskeletal disorders.
In the broader context of the U.S. labor market, wage movements at Amazon echo trends seen at other large employers. Walmart said in January 2024 that average wages for hourly workers would exceed $18, up from $17.50, following the introduction of higher-paying roles in some areas. Target, meanwhile, has reported starting wages ranging from $15 to $24 per hour depending on location. These benchmarks illustrate continuing competition to attract and retain workers in the retail and logistics sectors.
Amazon’s wage and health-care changes come as the company faces ongoing safety concerns and labor questions while continuing to invest in its workforce amid a competitive market for labor and logistics capacity.