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Fresh Ebola fears hit airline stocks

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How Amazon's new jobs really stack up

Amazon hiring 7,000 workers
By Chris Isidore

NEW YORK (CNNMoney) -- Amazon announced plans Monday to hire 7,000 workers for its U.S. operation, with most jobs offering pay and benefits far above typical retail wages, the company said.

Amazon did not give specific pay scales for the positions, but said the 5,000 warehouse jobs will pay 30% more than jobs in traditional retail stores.

The jobs are full-time permanent positions and also include stock grants that, over the last five years, have averaged 9% of pay for Amazon's full-time workers. And the company said many workers would also be eligible for 95% tuition reimbursement for those attending college, whether or not their field of study is related to their job.

In addition, Amazon is looking for 2,000 workers for its customer service department, with those jobs being a mix of full-time, part-time and seasonal positions.

The 5,000 fulfillment center jobs represent a 25% increase in current staffing in that department.

Amazon has been increasing its network of fulfillment centers and warehouses in order to offer quicker shipping to more of its customers. Many Amazon customers now have the option of next-day delivery, and the company is looking to offer same-day delivery on some items.

Last week, Amazon reported a surprise loss in its most recent quarter due to bigger investments in digital products than Wall Street had been expecting. But its revenue rose 22% compared to a year earlier.

Amazon's growing sales have hurt many brick-and-mortar retailers, including book retailer Barnes & Noble, electronics retailer Best Buy and housewares retailer Bed Bath & Beyond. Two years ago, book seller Borders went out of business, resulting in a loss of nearly 11,000 jobs at that time.

Amazon's fulfillment center jobs are located in Breinigsville, Pa., Middletown, Del., Chattanooga and Murfreesboro, Tenn., Charleston and Spartanburg, S.C., Patterson, San Bernadino and Tracy, Calif., Chester, Va., Coppell, Haslet and San Antonio, Texas, Hebron, Ky., Indianapolis and Jeffersonville, Ind. and Phoenix. The customer service jobs are in Grand Forks, N.D., Kennewick, Wash., Huntington, W.V., and Winchester, Ky.

President Obama is scheduled to speak at Amazon's Chattanooga fulfillment center on Tuesday, according to White House spokesman Josh Earnest.

"What the President is going to be focused on tomorrow in Chattanooga are policies that we can put in place that will support the private sector as they create jobs and continue to lead this recovery," he said.

According to its SEC filings, Amazon had about 88,400 full- and part-time employees companywide as of Dec. 31, up from only 17,000 workers five years earlier. Those figures are affected by seasonal workers brought on for the holiday period.

More information on the jobs is available at www.workatamazonfulfillment.com.

Emily Jane Fox

NEW YORK (CNNMoney) -- Amazon has been touting its plan to hire 7,000 new workers, and even President Obama is speaking at a company distribution center Tuesday on his jobs tour.

So how do Amazon's new jobs really stack up?

The online retail giant announced Monday that 5,000 of those new jobs will be warehouse positions that pay 30% more than traditional retail store jobs.

On the face of it, the comparison is accurate. Dig a little deeper and there's nothing special about Amazon's claim.

Elizabeth Brennan, a spokeswoman for Warehouse Workers United, a workers advocacy group, said pitting warehouse worker salaries against regular retail jobs is comparing apples against oranges.

The average U.S. warehouse worker, at Amazon or anywhere else, earns a third more than a retail worker. The median hourly wage of a warehouse worker is $13.50, or about 30% more than the average U.S. retail worker's pay of $10.09, according to the Department of Labor.

Amazon wouldn't say how much it pays its workers. But according to data gathered by career website Glassdoor.com, Amazon pays its 20,000 warehouse workers an average hourly wage of about $12, which is below the national average.

Spokeswoman Mary Osako said Glassdoor's numbers are closer to wages for entry-level workers.

She added that the figure also doesn't represent the Amazon worker's entire compensation. Its employees get full benefits and stock awards on top of their salaries. In the past five years, this has added an average of 9% to workers' base pay annually, Osako said.

Amazon also offers to pre-pay up to 95% of tuition for courses for its workers, regardless of whether the skills are relevant to a career at Amazon.

Amazon's fiercest competitor, Wal-Mart, said it pays its warehouse workers an average of $19 per hour, with benefits. This average includes entry level workers to managers.

What does all this add up to?

The average warehouse worker at Wal-Mart makes just under $40,000 annually, while at Amazon would take home about $24,300 a year. That's less than $1,000 above the official federal poverty line for a family of four.

Using this data as a guide, both Amazon and Wal-Mart pay their warehouse workers more than smaller, independent distribution centers. According to a study conducted by University of Southern California professor Juan D. De Lara, the average warehouse worker in the region made $16,000 per year.

De Lara said many warehouse workers don't work full-time, which is why he found their average annual income to be less than half of the $30,000 figure quoted by the Labor department.

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