Amazon is to more than double the base pay for corporate and tech staff to $350,000 as part of a drive to attract top talent.
The base salary will now be more in line with that of other major tech corporations such as Google, Facebook, Apple, and Microsoft.
Amazon has historically maintained its base pay lower than many of its competitors, making up the difference with restricted stock units and cash rewards such as a two-year sign-on bonus.
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Those additional components of compensation will remain in place and Amazon says it’s “increasing overall compensation ranges for most jobs globally, and the increases are much more considerable than we’ve done in the past.”
Employees’ base salary is only a small part of their total compensation.
This amount excludes restricted stock units (RSUs), which often vest in multiple years, as well as additional income, such as sign-on incentives.
The company’s pay has traditionally been mainly based on stock.
A memo to staff said: “This past year has seen a particularly competitive labor market, and in doing a thorough analysis of various options, weighing the economics of our business and the need to remain competitive for attracting and retaining top talent, we decided to make meaningfully bigger increases to our compensation levels than we do in a typical year.”
“Amazon is raising total compensation ranges for most jobs globally in addition to raising basic pay and the increases are far more substantial than we’ve done in the past.”
The revisions come as Amazon is increasingly being criticized by its employees for what they perceive to be inadequate pay.
According to internal polls, the base salary was recently identified as one of the top reasons for employees wishing to leave the company, as reported by Business Insider last month.
Labor competition is fiercer than it has ever been, especially since the coronavirus pandemic has given workers more clout to demand better benefits and wages.
Companies are increasingly offering flexible work options, such as remote or hybrid work.
As a result, Amazon and other tech businesses have admitted that not providing these incentives could impair their ability to attract and retain talent.
According to Levels.fyi, a website that measures salary in the tech industry, Amazon did not rank among the top seven employers for engineering pay last year.
A top-level engineer at Roblox may earn more than $1 million, while one at Facebook could earn more than $900,000, however, these statistics encompass all types of remuneration, not just basic pay.
Source: CNBC
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