The Mighty Amazon Is Swelling
Amazon is adding 5,000 full-time positions to its fulfillment centers and another 2,000 part-time and seasonal jobs to bolster its customer service. The announcement has political overtones, as President Obama will make a speech on jobs from an Amazon fulfillment center later this week. This is classic Amazon -- spending money to make money, noted e-commerce consultant Rob Abdul.
07/29/13 4:42 PM PT
Amazon is hiring more than 5,000 people to work in 17 of its U.S. fulfillment centers, it said Monday. In addition to the fulfillment center jobs, Amazon will hire 2,000 new employees to work in its customer service centers.
The fulfillment center jobs, which are scattered throughout the country, are full-time opportunities that pay 30 percent more than workers earn in a traditional retail store, according to Amazon. The perks include stock grants, bonuses and benefits. The new employees will join more than 20,000 full-time employees already working in the company's fulfillment centers across the U.S.
The customer service jobs will be a mix of full-time, part-time and seasonal opportunities.
The news comes a few days before President Obama is scheduled to deliver an address on jobs from one of Amazon's Chattanooga, Tenn.-based fulfillment centers.
It also comes at a time of growth for Amazon, as indicated by its recently released quarterly earnings report, which indicated spending costs have been accelerating with the expansion of the company's delivery and content platforms.
Amazon's Prime service offers two-day shipping, access to streaming content, and other benefits for US$79 per year. The company is experimenting with same-day shipping of groceries, including fresh produce, and other items in some parts of the country.
In order to keep up with those shipping demands, Amazon has added eight fulfillment centers in the U.S. during the past year and plans to add another five by the end of 2013.
Amazon's growth and hiring spree is right in line with its strategy of spending money to make money, said e-commerce consultant Rob Abdul.
"This is a textbook case of Amazon aggressively expanding its centralized infrastructure to streamline its supply chain," he told the E-Commerce Times.
That infrastructure might have grown past the point where other brick-and-mortar retailers can compete. That doesn't mean there isn't hope for the more traditional vendors, but Amazon's ability to hire 7,000 new employees does indicate that retailers might have to find profitable niches rather than attempt to compete head-on with Amazon, Abdul added.
"They may not be the size of Amazon, but what this clearly indicates is savings can be made by streamlining supply chains, and that the shortening of delivery times leads to growth," he pointed out.
Look to E-Commerce for Jobs
Amazon's dominance is not limited to e-commerce.
"The company that was once just selling books today has become a technology powerhouse," Trip Chowdhry, senior analyst for Global Equities Research, told the E-Commerce Times.
"These new hires in a way show us how Amazon has ushered in a decade of computation where cloud computing can help with massive scalability. They're able to offer 100 times more services at one-hundredth of the cost. Amazon's hiring of 7,000 workers is a testament to the fact that that's the way the industry has shifted."
Amazon didn't register a profit on its balance sheet for the latest quarter, but its spending has helped it expand and create jobs, which are also important benchmarks for successful U.S. companies in this economy, said Chowdhry.
"Amazon has been investing in technology and investing for the future, thinking big and bold, unlike what some tech companies out there have been doing with their cash," he added. "Today, because of that, they're one of the standards when it comes to cloud computing and e-commerce. Those areas are going to be very strong going forward, and are going to be the areas where the U.S. will see jobs added."