Amazon says wage hike ‘more than compensates’ for loss of bonuses • Hacker News Board

Re: Amazon says wage hike ‘more than compensates’ for loss of bonuses

#61

Post by test6554 » Thu, Oct 11, 2018, 6:10 PM UTC

aetherson wrote: post #57

chadash wrote: post #10

In the past 5 years, Amazon's stock has gone up almost 6X. Anyone who got paid in RSUs almost certainly made out well. But, as Amazon points out in their statement, past results are no guarantee for stock performance going forward. I can pay you $500 in cash or I can give you $500 worth of stock (which vests over a period of time). Generally speaking, the cash (which you get right away) should always be valued more s…

They'll be comparing the instantaneous value of the stock with the value of the raise. So if you previously got pay for the month of let's say $2,000 plus $400 in RSUs (the value of the RSUs at the moment they're assigned), then you might lose the RSUs but get paid $2,500 per month -- a $100/month raise. If you then feel that Amazon stock is a good investment, you can buy $400 of Amazon stock on the public market, an…

Not to mention that owning stock in the company you work for is not a very diversified portfolio. If Amazon crashed and filed for bankruptcy for some reason, you would lose both your job and your savings. That doesn't seem very likely given Amazon's size, but look at Sears.

Re: Amazon says wage hike ‘more than compensates’ for loss of bonuses

#62

Post by beat » Thu, Oct 11, 2018, 6:19 PM UTC

cromwellian wrote: post #41

maym86 wrote: post #36

Earlier quoted context omitted.

Exactly, and Amazon is still growing so even as some jobs are gradually replaced by machines the total number of workers is still increasing.

But they are being replaced with engineers, salesmen, and customer support, not with warehouse employees. Different skill sets and likely, a net loss of jobs for the poorest and a net increase of white collar positions.

200 years ago, 95% or more of the population was employed as farmers. Today, it's less than 3%. Somehow, we survived.

Re: Amazon says wage hike ‘more than compensates’ for loss of bonuses

#63

Post by beat » Thu, Oct 11, 2018, 6:22 PM UTC

cromwellian wrote: post #37

beat wrote: post #28

Earlier quoted context omitted.

I don't buy this argument. The problem usually isn't that robots are too expensive to do the human jobs, it's that robots can't do the human jobs, period. If something can be done by machine, it is done by machine, and that's been true since the beginning of the industrial era. Entire job classifications get wiped out by new automation, all the time. At this point, the jobs that are still done by humans are jobs that…

The Amazon of China, Jingdong, has a fulfillment center that handles hundreds of thousands of packages a day and employs just five people: https://youtu.be/RFV8IkY52iY Amazon used humans because the investment to build full automation was too expensive and take too long to build out compared to spinning up human labor. However now the logistics of the fulfillment center are well understood and they can be rebuilt wit…

What part of fulfillment, though?

In my area, Amazon has its own trucks delivering packages, for the most part. That's not exactly something that can be automated.

Re: Amazon says wage hike ‘more than compensates’ for loss of bonuses

#64

Post by dv_dt » Thu, Oct 11, 2018, 6:26 PM UTC

chadash wrote: post #10

In the past 5 years, Amazon's stock has gone up almost 6X. Anyone who got paid in RSUs almost certainly made out well. But, as Amazon points out in their statement, past results are no guarantee for stock performance going forward. I can pay you $500 in cash or I can give you $500 worth of stock (which vests over a period of time). Generally speaking, the cash (which you get right away) should always be valued more s…

Given predictions of a economic downturn Amazon has done a lot of these workers a favor in terms of their risk profile by changing RSUs and bonuses to hard compensation.

Re: Amazon says wage hike ‘more than compensates’ for loss of bonuses

#65

Post by beat » Thu, Oct 11, 2018, 6:27 PM UTC

rdtsc wrote: post #44

Not sure what to think about Bernie needing too go as far as naming the bill "Stop BEZOS" https://www.sanders.senate.gov/download/the-stop-bezos-act-s... It was a political move, and it worked it got Amazon do respond. But seems a bit childish. Remembering when I was making $7.50 / hour, bump in salary would have been better than bonuses or RSUs. I think in that salary range, this is still a good move.

I'm not convinced the bill, or the political climate in general, led to this. I think the unemployment rate did. Amazon is looking at their holiday season staffing needs, and wondering how to compete against all the other businesses fighting over that limited labor pool. A big "$15!" splashy headline looks great then.

Then business does business, and attaches a bunch of cost-saving measures to it, and then it looks bad. No different than the normal corporate development cycle. Not enough leadership, a bunch of people doing what's best for their department rather than the whole company. Sad.

Re: Amazon says wage hike ‘more than compensates’ for loss of bonuses

#66

Post by behringer » Thu, Oct 11, 2018, 6:32 PM UTC

p0rkbelly wrote: post #56

bryanlarsen wrote: post #20

Earlier quoted context omitted.

And the Amazon statement in the article says "more than compensates for the phase out of incentive pay and future RSU grants." The conflict is probably due to the fact that RSU grants were very lucrative over the last few years. If you assume that the stock is going to quadruple in the next 3 years, then yes, a RSU bonus is probably better than a raise, but I don't think Amazon will be a 4 trillion dollar company in…

correct. For companies with heavy RSU based compensation they assume a certain % of growth every year. Say 10%. Let's say Amazon did 50% year over year. You did better than you expected. However, next year you will get less RSUs since you made a lot more than planned in the previous year. Having a very good year, as I imagine most Amazon employees did, does not mean you should get the same windfall money next year. I…

Not properly understood? No, the bonuses were taken away and the pay rate was raised instead. However, Amazon said people were just getting a raise because of the poor pay they've been getting. They weren't promised a different way of getting paid. They were promised a raise

Re: Amazon says wage hike ‘more than compensates’ for loss of bonuses

#67

Post by slededit » Thu, Oct 11, 2018, 7:34 PM UTC

kpwags wrote: post #3

I can understand some of the frustration, especially for those making just shy of $15 before the raise, but even if the raise is only from $14 to $15, that still is around $2,000/yr (assuming 40 hour work week) that is guaranteed the way a bonus generally isn't. I would almost always prefer a raise over a one-time bonus for that exact reason. In my experiences, I can't always count on my company giving me a yearly bo…

The problem is this was announced as giving them a massive raise. It turns out it was really just a wash and mostly a PR stunt. They aren't actually giving the employees more money than before.

People were comparing this to Henry Ford's livable wage.

Re: Amazon says wage hike ‘more than compensates’ for loss of bonuses

#68

Post by pkaye » Thu, Oct 11, 2018, 8:04 PM UTC

cromwellian wrote: post #37

beat wrote: post #28

Earlier quoted context omitted.

I don't buy this argument. The problem usually isn't that robots are too expensive to do the human jobs, it's that robots can't do the human jobs, period. If something can be done by machine, it is done by machine, and that's been true since the beginning of the industrial era. Entire job classifications get wiped out by new automation, all the time. At this point, the jobs that are still done by humans are jobs that…

The Amazon of China, Jingdong, has a fulfillment center that handles hundreds of thousands of packages a day and employs just five people: https://youtu.be/RFV8IkY52iY Amazon used humans because the investment to build full automation was too expensive and take too long to build out compared to spinning up human labor. However now the logistics of the fulfillment center are well understood and they can be rebuilt wit…

Automation doesn't work for everything. Like when the product being shipping is of varying size and shape. Like clothing, books, pouches all in one box. Or stacking the boxes in a truck. Or look at something like car assembly. Tesla still uses people to route wiring harnesses through the car body because robots can't do it well. Many simple things can get automated but there is still a lot not yet possible.

Re: Amazon says wage hike ‘more than compensates’ for loss of bonuses

#69

Post by s3r3nity » Thu, Oct 11, 2018, 8:26 PM UTC

dreamache wrote: post #43

"Bezos is no fool. He will reduce his headcount, and step up his automation effort to eliminate as many low-skilled jobs from Amazon. Then he will lobby Congress to increase the minimum wage for his competitors that still employ lower-skilled workers. As these competitors will lack the resources to automate, they will be driven out of business, and all their workers will lose their jobs. Less competition will make it…

The problem I have with this argument is that it sets up Amazon in a caricature that always makes them look evil and anti-labor:

1) Don't support lowering the minimum wage = Democrats + labor groups hate on you for not paying workers, even if you can hire more of them = anti-labor 2) Support the minimum wage nationally + across their international workforce = "This is an automation ploy + competitive advantage = anti-labor

There seems like no ideal approach for low-skilled labor here that won't seem anti-labor in the short-to-medium term

Re: Amazon says wage hike ‘more than compensates’ for loss of bonuses

#70

Post by krapp » Thu, Oct 11, 2018, 9:44 PM UTC

chadash wrote: post #10

In the past 5 years, Amazon's stock has gone up almost 6X. Anyone who got paid in RSUs almost certainly made out well. But, as Amazon points out in their statement, past results are no guarantee for stock performance going forward. I can pay you $500 in cash or I can give you $500 worth of stock (which vests over a period of time). Generally speaking, the cash (which you get right away) should always be valued more s…

>Anyone who got paid in RSUs almost certainly made out well.

"Well" is relative. The price of the stock may have gone up but its value is still much less than that of the income they could have had at $15/hr over the time it takes to vest. No one is really making out like a bandit on their RSUs at that level.