Amazon is hiring a bonkers number of temporary employees this holiday season, so that you can be absolutely sure the blender or coffee mug you’re sending to your great-aunt gets there in time for Christmas. Instant gratification for everyone!
The world’s largest online retailer is creating 100,000 seasonal jobs, it announced today with a press release. That’s up 25 percent from last year, when Amazon hired 80,000 temporary workers, and it doesn't include the more than 25,000 full-time workers Amazon already hired in the US in recent months. According to The Wall Street Journal, it's also more than the number of seasonal workers Target (70,000), Macy’s (85,000), and Wal-Mart (60,000) each hired in anticipation of the retail world’s busiest time of year. Unlike Amazon, these companies are reportedly holding steady on their seasonal hires this year.
Plus, Amazon continues to expand its infrastructure in support of its massive logistics goals for this holiday season. According to calculations from ChannelAdvisor executive chairman Scot Wingo, an analyst who tracks Amazon closely, Amazon has expanded to 173 facilities worldwide, up from 155 warehouses last year. That helps the company shrink those crucial delivery times and costs down to as small a margin as possible.
"Other retailers are going to struggle to come close,” Wingo writes in a blog post. “They do not offer nearly the same level of selection and efficiency that Amazon’s logistical network provides.”
That's the prevailing narrative: e-commerce is still experiencing crazy growth, while traditional retail struggles to keep pace. The US Department of Commerce recently estimated that the US retail e-commerce sales for the second quarter of 2015 reached $83.9 billion, an increase of 4.2 percent from the first quarter of 2015 and an increase of 14.1 percent year over year. E-commerce sales in the Q2 2015 also accounted for 7.2 percent of total sales in the US, according to the department. Meanwhile, total retail sales on the whole grew by just 1.6 percent from the first quarter of 2015 and 1.0 percent year over year.
Just look at the paths of Amazon and Wal-Mart. In July, Amazon surpassed Wal-Mart as the world’s largest retailer by market value after a surprise second quarter profit. Meanwhile, Wal-Mart recorded its biggest one-day decline in almost three decades after it announced, to stunned investors, that it expected its growth over the next three years to be a paltry 3 to 4 percent, and would likely see profits drop up to 12 percent next year.
After the news came out, investors saw over $20 billion in market value vanish in one day—and saw $83 billion disappear this year. The reason why it’s doing so terribly: It’s investing a ton of resources in things like wage hikes for employees to keep them happy, building out online grocery shopping, trying out subscription shipping. Basically, it needs to fend off Amazon, which is doing great in those areas.
Investors just seem to view Amazon as a better bet these days, a company that, even after 21 years of existence, is still unafraid to try new things and see what turns out to be its next breakout hit. It’s already seen massive success with the cloud and (less conspicuously) its third-party online marketplace. It just launched Handmade, an Etsy competitor for artisanal goods, and Flex, an Uber-like platform where on-demand workers could pick up shifts delivering packages. It’s still visibly innovating in a lot of ways, which is attractive to potential shareholders.
So, this upcoming holiday season, expect the differences between these massive players in retail to be thrown into even sharper relief. Amazon’s likely to keep crushing it—and it’ll have the workforce and the infrastructure that enables it to do so. Now, if it would only make a better effort than its recent misguided attempts to fix its culture image problem.
