Amazon Raises Minimum Wage to $15
On November 1, 2018, CEO of Amazon, Jeff Bezos announced that Amazon would raise the minimum wage to $15, more than double the $7.25 federal minimum wage. This change was enacted after Amazon received backlash for having a low employee median income of $28,446 per year. “We’re excited about this change and encourage our competitors and other large employers to join us,” said Bezos.
The recent change has sparked a very positive response from politicians who have been advocating for a higher minimum wage for years. Bernie Sanders, Senator of Vermont, shared his opinion at a news conference on Capitol Hill, saying, “I have to give credit where credit is due. And that is that Mr. Bezos today did the right thing.” Sanders encourages more companies to raise their minimum wage and even believes the federal minimum wage should be increased as well. Amazon also feels a need for an increase in federal minimum wage, and its public policy team is going as far as lobbying for it.
There have been many companies which raised their minimum wage lately, including Target, McDonald's, Ikea, Costco, and Aetna. Disneyland and Disney World also plan on increasing their minimum wage in the near future. Large-scale businesses have no problem with this increase considering they have such a great income. Small businesses, on the other hand, may have trouble adjusting to such a big change, as their profits are significantly lower.
According to PayScale, a compensation survey administrator, small business owners only make an average of $35,000 to $75,000 a year. This income makes it nearly impossible to have a minimum wage of $15 without raising prices exponentially. People who advocate for an increase in the minimum wage believe it will be a good way to transfer the wealth from business owners to low-income workers, but realistically speaking, the only way to raise the wage would be to raise the prices of products. Higher prices would improve the economic situation of workers at the expense of worsening the economic situations of lower or middle-class consumers.
Despite the controversy surrounding this topic, it is easy to agree that companies that have the means to increase their minimum wage should do so. The federal minimum wage is not built specifically to fit the circumstances of large businesses. According to the U.S Census, small businesses make up about 99% of all businesses in America, so they need to be accounted for when creating a federal minimum wage.
When it comes to the minimum wage of large companies, Amazon is blazing the way for many businesses, inspiring more and more companies to raise their wage and improve the lives their workers.