Amazon’s New Worker Education Program: Good Business or PR Stunt?
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Amazon (AMZN), which has come under intense scrutiny for unfavorable labor conditions at its fulfillment centers, announced a new worker-education program this week to help improve the careers of some of the company's most dedicated employees.
The largest U.S. online retailer plans to reimburse its full-time hourly workers for vocational training at an accredited school. Selected employees would be given $2,000 a year for four years.
The caveat lies in the program requirements. In order to apply and participate, workers must have been with the company for at least three consecutive years.
Amazon posted details about its program on its retail site Monday:
"At Amazon, we like to pioneer, we like to invent, and we're not willing to do things the normal way if we can figure out a better way. It can be difficult in this economy to have the flexibility and financial resources to teach yourself new skills. So, for people who've been with us as little as three years, we're offering to pre-pay 95% of the cost of courses such as aircraft mechanics, computer-aided design, machine tool technologies, medical lab technologies, nursing, and many other fields."
Amazon's Career Choice Program: Good for Workers or P.R. Stunt?
Showcasing the company's new education program on the Amazon homepage has some critics wondering whether this program is nothing more than an attempt to improve the company's image.
Will Oremus of Slate is skeptical and wrote this week:
"There's something puzzling about the company's use of its massively trafficked front page to broadcast this program. In an economy full of unemployed people desperate for work, does Amazon really have to blast all of its millions of customers to find a few hundred new applicants?"
Keith Wrightson, worker safety & health advocate at Public Citizen's Congress Watch, agrees.
"It seems like they're in desperate need of repairing their reputation and this is how they have chosen to respond to public pressure and pressure from their workers," says Wrightson in the accompanying interview. Wrightson cited the unsatisfactory conditions chronicled at Amazon's Allentown, PA warehouse, where some workers fainted and were rushed to a hospital during a heat wave. According to an investigation by The Morning Call in Allentown, Amazon paid ambulances to sit outside the warehouse in the event of more heat-related sicknesses.
"If they are trying to step up and do the right thing, why not let everyone access to this program? Why not sharpen the skills of all their employees?" asks Wrightson. "It seems like Amazon's Career Choice Program is a P.R. stunt."
Washington State Governor Chris Gregoire says the Amazon Career Choice Program could be good news for thousands of Americans at a time when the price of higher education has dramatically increased and the unemployment rate remains above 8 percent.
"I welcome Amazon's innovative initiative, which offers a new and exciting way for corporate support of employee education," Gregoire said on the Amazon press release for this program. "I hope that other companies follow Amazon's lead and I thank them for a creative new approach."
Wrightson says he believes Amazon should pay all its warehouse employees higher wages as well as drastically improve the conditions in its fulfillment centers. Amazon has recently installed a $52 million cooling system at its Pennsylvania warehouses and plans to build air conditioning units into all of its U.S.-based fulfillment centers.
The Daily Ticker reached out to Seattle-based Amazon to determine the average wage it pays its warehouse employees. According to company spokesperson Kelly Cheeseman, the company does not publicly disclose that information; however, she says the company does pay its fulfillment center employees 30 percent more than the average retail store employee at brick-and-mortar stores.
Cheeseman was quick to defend Amazon's worker-education program and pointed out that Amazon is expanding and hiring at a time when many other companies are not.
The online retailer is currently undergoing a vast expansion of its fulfillment warehouses to help meet growing demand for its goods. The new warehouses will also allow Amazon to offer customers same-day delivery. Amazon will be building new warehouses in Delaware, South Carolina, Indiana, California, Virginia, Tennessee and New Jersey; they're expected to be as large as one-million-square feet and employ anywhere between 400 and 1,500 full-time workers.
Additionally, "Amazon will exclusively fund education only in areas that are well-paying and in high demand according to sources like the U.S. Bureau of Labor Statistics, and the company will fund those areas regardless of whether those skills are relevant to a career at Amazon," according to the company's website.
Amazon's 2Q Earnings
Amazon met revenue expectations, but missed on profits in the second quarter according to its earnings report released Thursday after the closing bell.
The company reported $12.8 billion in sales, up from $9.91 billion the previous year. It reported net income of $7 million, or 1 cent per share; analysts was looking for 2 cents a share. Amazon shares traded higher after the earnings announcement.
Tell us what you think! Is Amazon's Career Choice Program good for workers or a P.R. Stunt?
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