Amazon plans to invest $440 million in a program that may up average delivery driver pay to $20.50 per hour.
Amazon launched its Amazon Delivery Service Partner program in 2018 to create a delivery network of independent contractors. In five years, 3,500 delivery companies have launched, employing 279,000 people. By increasing the rate it pays to those companies, the businesses will be able to offer drivers improved wages and benefits and more effectively recruit, Amazon said.
Amazon pledged a total of $840 million in incremental investment in the program, which also includes expansion of its education program to give drivers access to tuition coverage and reimbursement and to offer a child care support service to help workers find child care providers.
In all, Amazon has invested more than $8 billion in the program since its launch, and the program annually generates $45 billion in revenue, the company said. Amazon announced the investment Tuesday during its annual conference for delivery companies, Ignite Live.
The investment in drivers comes at the same time as other logistics companies are upping wages through contract negotiations, and drivers, including at Amazon, are looking to unionize. Randy Korgan, director of the Teamsters Amazon Division, recently told Supply Chain Dive the time is ripe to organize Amazon drivers.
The National Labor Relations Board saw a record number of new cases in fiscal year 2022, with unfair labor charges and union representation petitions increasing 23%, from 16,720 to 20,498 — the biggest single-year increase in 46 years and the greatest percentage increase in 63 years, NLRB said.
Nationwide, companies have turned to benefits as a way of retaining and recruiting employees and improving total rewards packages. Indeed, for example, recently announced a $10,000 relocation benefit for workers living in states with restrictions on gender-affirming care. And Walmart is offering employees a free financial literacy course.
