A Defense of Amazon
On December 18th, AOC tweeted out a Bloomberg article titled, “Amazon Has Turned a Middle-Class Warehouse Career Into a McJob.”(1)
She says, “This is why 'Amazon jobs' aren't it & we should instead focus our public investments + incentives on small businesses, public infrastructure, & worker cooperatives that actually support dignified life. A job that leaves you homeless & on food stamps isn’t a job. Its a scam”(2)
The Bible constantly reminds us to care for and not exploit the poor.
“For there will never cease to be poor in the land. Therefore I command you, ‘You shall open wide your hand to your brother, to the needy and to the poor, in your land.’”- Deuteronomy 15:11
“Hear this, you who trample on the needy and bring the poor of the land to an end, saying, “When will the new moon be over, that we may sell grain? And the Sabbath, that we may offer wheat for sale, that we may make the ephah small and the shekel great and deal deceitfully with false balances, that we may buy the poor for silver and the needy for a pair of sandals and sell the chaff of the wheat?” The Lord has sworn by himself, the Pride of Jacob: “I will never forget anything they have done.”-Amos 8:4-7
Therefore, it is good and proper that we be offended when we see a corporation mistreating its employees, especially if they are poor or lower-middle class. But before we cast stones we must look past emotional tweets and headlines and examine the arguments presented. When I did this, I found four glaring flaws in AOC and Bloomberg’s analysis and understanding of basic economics.
1. AOC doesn’t understand what a job is. A job is a voluntary and mutually agreed upon exchange of services between employer and employee. Nothing requires it to cover all housing and food expenses. Some jobs are meant to be entry level jobs, meant to develop skills or supplement income. In the academic world these are called internships or Co-ops. When I was ten years old my parents paid me $20 a week for push-mowing the grass. According to AOC’s tweet I was scammed because that’s not enough to afford a house.
Now we all instinctively recognize this is ridiculous. And it is. I was ten, I didn’t have to pay for gas, and my cost of living was zero. Therefore AOC claiming I, or some Amazon employee, was scammed based on the rate of pay is inane, because a rate of pay is meaningless without answering relevant questions about an individual’s choices and lifestyle.
2. In the article, they interview several employees. Courtenay Brown’s story is particularly interesting. While it is clear Courtenay’s intent is to criticize Amazon, her testimony tells a different story. “The last thing we want to do is lose our job because we’ll go back to being homeless and have nothing.” She continues, “We’re in a tough situation, and this is all we can find that's stable. Amazon comes to places when people are desperate.”
Listen to what she’s actually saying. She was in a tough situation. She was homeless and there were no stable jobs to be had. But then Amazon moved into her area and now, with the help of a local charity, she can afford a house, utilities, food, and clean clothes. If the article didn’t provide context explaining that she is actually complaining about her level of pay, I would say this was a plot fit for a Hallmark movie.
3. The authors don’t seem to like progress. Look at how they describe working for Amazon. “Turned a...Career Into a McJob”
These words have some very negative connotations. But before we sharpen our pitchforks we need to determine what is actually happening. The article interviews another employee, Matt Giannini,who explains how Amazon is transforming the shipping industry.
“Most of the labor in Amazon’s largest fulfillment centers is divided into simple, repetitive tasks: receiving goods arriving in trucks, placing items into mesh shelving, or retrieving and speeding them along a conveyor belt in yellow plastic bins to be boxed and shipped. Most jobs are marketed to high-school graduates—no resume required ... Matt Giannini, who spent five years at a warehouse in New Jersey, says Amazon’s genius lies in simplifying most tasks to the point but where anybody can do it. ‘They’ve gotten it to such a science,’ he says. ‘Every single process is very simple.’”
So Amazon has turned the shipping industry into a cheap and efficient assembly line, in much the same way that McDonald’s has turned serving burgers into an assembly line. That seems a fair comparison. But is this as bad as the authors imply?
At a technical level, this is Creative Destruction at work. This theory deserves its own essay, but a simple example is that the invention of the automobile (a more affordable efficient form of transportation) “dragged down” the pay of horse breeders. While this may have hurt one industry, this helped grow the economy on a national scale.
Which would you prefer?
70mph with air conditioning, shock absorbers, and protection from the environment
Or
17mph with no air conditioning, no shock absorbers, and no protection from the environment
The way the authors talk about Amazon indicates they would prefer the horse.
4. The article misuses its own statistics.
“Many Amazon warehouse employees struggle to pay the bills, and more than 4,000 employees are on food stamps in nine states studied by the U.S. Government Accountability Office. Only Walmart, McDonald’s and two dollar-store chains have more workers requiring such assistance.”
The article says 4,000 people is “many” people. Okay... Many compared to what?
Is it “many” compared to the members at my church? Is it “many” compared to the number of employees at Amazon? Or is it “many” compared to the number of employees at some other company like Walmart?
The article makes no effort in answering this question, and personally this is the most frustrating part of the article.
When working with data and statistics it is always important to provide a grading scale or something that can be used to make an apples-to-apples comparison. So, I dug through the original GAO report and was able to recreate the statistics presented in the article(3). Then, for each company I divided the number of people on food stamps by the total number of employees(4). And as you can see the resulting graph is very different from the one they provide.
Walmart: 14,361 employees on food stamps / 2,200,000 US employees = 0.7% are on foodstamps
McDonald’s: 8,783 employees on food stamps / 205,000 total employees = 4.3% are on foodstamps
Dollar Tree: 4,515 employees on food stamps /182,100 total employees = 2.5% are on foodstamps)
Dollar General: 4,488 employees on food stamps /135,000 total employees = 3.3% are on foodstamps)
Amazon: 4,218 employees on food stamps /798,000 total employees = 0.5% are on foodstamps
Now in closing, I want to be clear that I am not saying Amazon is perfect, but it clearly is not the villain as maligned by AOC and Bloomberg. The interviews and statistics actually show Amazon provides valuable compensation (wages and benefits) to desperate people in its local communities, and for that they ought to be commended.
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