Amazon’s CFO told reporters after the revenue did not meet expectations that in the third quarter, the availability of employees became the main challenge Amazon faced in ensuring that the software package passed through its system smoothly, rather than the normal limitation of storage space or performance capacity.
Chief financial officer Brian olsavsky said in a media telephone interview: “therefore, inventory arrangements are often transferred to performance centers with labor to receive the product.”. “This leads to a less ideal layout, resulting in longer and more expensive transportation routes.”
Olsavsky said that the overall shortage of labor in the United States, coupled with the increase in Amazon’s demand for workers, led to an increase in wages and signed incentives because companies are competing for scarce workers.
Amazon strives to avoid affecting customers, which is an important reason for its higher than expected cost and lower than expected profit in the third quarter. The company said the trend would continue in the fourth quarter, including the key shopping season.
By the end of the third quarter, the company reported 1.468 million full-time and part-time employees, a year-on-year increase of 30%, an increase of 133000 over the end of the second quarter. Olsavsky said that most of the recruitment is carried out in the company’s fulfillment network.
Amazon is currently recruiting an additional 150000 seasonal employees for the holiday season.
Direct employment does not include more than 260000 drivers working in independent Amazon express service partners.
Olsavsky said that global supply chain constraints and inflation in the cost of materials and services have also increased the company’s expenditure. Coupled with labor challenges, the operating cost will increase by about $2 billion in the third quarter.
The company has said for months that it will increase spending to attract and retain employees with a tight labor market. Its average starting salary in the United States is now $18 an hour.