Amazon offers $ 4,000 bonus to attract UK workers

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An Amazon warehouse in Leeds, England.

Nathan Stirk | Getty Images

LONDON – Labor shortages are forcing UK companies to raise wages to compete with workers, with Amazon offering membership bonuses of up to £ 3,000 ($ 4,140) as the holiday season approaches.

The e-commerce giant is currently advertising a number of UK positions that come with big cash bonuses. A role, for a temporary warehouse worker in the English city of Exeter, offers an onboarding bonus of £ 3,000, while a London-based job at the company offers a signing bonus of £ 2,000 £. Many other roles in Amazon UK warehouses offer welcome bonuses of £ 1,500.

Basic hourly rates are £ 11.10 an hour in London, while overtime can reach £ 22.20. The average wage for warehouse workers in the UK is £ 10.16 an hour, according to the job site Indeed.

Amazon’s aggressive hiring campaign reflects workforce issue across UK

Britain has an estimated shortage of 100,000 truck drivers, which has disrupted deliveries and led to empty store shelves, backlogs at ports and dry gas stations. Meanwhile, industries such as agriculture, warehousing, food processing and hospitality have all warned of a severe labor shortage.

Graham Sheen, secretary of the UK’s Bonded Warehousekeepers Association, told CNBC on Tuesday there was a shortage of warehouse workers, especially in the wake of Brexit.

“If you are from another country, you have to earn at least £ 26,000 to get a work visa – people entering the warehouse will not make that kind of money,” he explained. “So they’re not going to go into storage.”

Sheen noted that other companies in the warehousing industry would likely be forced to rethink what they offered to employees given the bonuses and pay rates offered by Amazon.

“For other companies to try to reach that level, it’s a lot of investment for them, but it’s just something that they’re going to have to invest in, whether it’s bonuses or increases. pay rates, which ultimately puts the costs back in order to get the best people, ”he said.

The latest figures from the UK’s Office for National Statistics showed that vacancies reached a record high of 1.1 million between July and September.

Many employers, like Amazon, offer financial incentives to attract employees. A survey of more than 400 UK human resources managers published by Indeed Flex on Wednesday showed that nearly half of companies had increased wages faster than usual in an attempt to address labor shortages.

Alpesh Paleja, chief economist at the Confederation of British Industry, which represents 190,000 companies, told CNBC by email on Tuesday that labor shortages remain a challenge in many sectors of the UK economy .

Employers are using all possible levers to alleviate this problem, through targeted salary increases, increasing investments in training, expanding their talent pools and stepping up investments in digital and automation, ”he said. -he declares.

Small businesses in difficulty

Many small businesses are unable to simply spend the money on the problem and find it difficult to compete with Amazon when it comes to recruiting.

“The number of small businesses that cite access to skilled workers as a barrier to growth is now 38% – a five-year high – with no sign of slowing any time soon,” Federation President Mike Cherry small businesses in the UK. , told CNBC by email on Tuesday.

Julia Kermode, founder of IWork – an organization representing temporary, self-employed and odd-job workers – told CNBC that labor shortages were so severe that the “army of temporary workers” UK was unable to meet demand.

Several UK companies have told CNBC they are struggling to find employees but cannot afford to raise wages after the pandemic.

Jo Bevilacqua, who owns a beauty salon, said recruiting skilled and experienced employees has become impossible.

“Many left the industry during Covid, unable to survive the constant lockdowns, or unwilling to face the pressure once the industry reopens,” she told CNBC in an email. “It worries me where the industry is going if more and more people leave to look for other opportunities – although we invest a lot of time and money in training and employee incentives, we cannot not compete with Amazon with their welcome bonus of £ 3,000. “

Adam Bamford, CEO of gift basket company Colleague Box, also told CNBC he was under pressure to hire “at all levels”, especially for warehouse and packing positions.

“As a small business, we can’t afford to sign bonuses for short-term contracts, and I understand why if you were looking for a job you would take the money,” he said. “Bonuses are often a month or two of salary, which covers the period for which we are looking to recruit – so we would essentially pay double the time all the time.”

Flexibility and ethics

Incentives other than wages also come into play.

According to Indeed Flex data, half of UK companies were focusing on non-financial benefits like flexible working hours to attract potential hires.

Chris Sanderson, CEO of hotel recruitment app Limber, told CNBC by email on Tuesday that the pandemic had created a disconnect between employers and employees, which had left many companies behind.

“In the hospitality sector, for example, companies are struggling to recruit across the country because they have not adapted quickly enough to the demands that many young people have after their experiences of the pandemic, namely flexibility. , variety and control, “he said.

Kermode added, “It’s incredibly competitive, and a lot of small businesses just don’t have the money to spend on the problem. But money is not the end: people want to work with companies whose ethics and values ​​they agree with. , companies that have a positive impact on the rest of the world. “


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