Amazon was founded in Seattle, Washington; their story began in 1994 by making it in the internal range of the Fortune 500 companies. What made this company to rise to its potential are its technological innovations and the type of perception they portray to the customer; such as a 1-click buy and items shipped for free in less than 2 days. This company officially started in 1995 and was originally a place where you would go try to find books. Amazon has hugely expanded as a retail company that offers its customers a more variety of products. Such as; having lower prices while making it a more convenient and easy place to shop for everyone. Amazon caters to all consumers by having a huge variety of products available and in stock from shoes to apparel for all ages, jewelry, electronic devices, books, sports, toys, health, home, and beauty products to name just a few. Amazon is rated to be the second highest out of the fortune 500 companies for having high turnover with their employees. Amazon employees are said to just be employed for between 9 to 11 months, not even making it to a full year. It leaves you wondering why?
As we hear big companies names being mention and become popular we never tend to look into the internal issues that happen within a successful organization. In Amazon’s case specifically, one issue that needs to be addressed is the reason why Amazon has such a high turnover rate. Amazon is an online retailer that allows users to browse and find products through their web interface. (Mahapatra, 2013) They tend to provide low prices and different options for each single item. Thanks to their innovative creations they are expanding rapidly and they are famous for their e-commerce shopping experience. However, this fortune 500 company although it is growing and making high profits while gaining a great reputation; employees seem to be leaving and they are having issues retaining talent.
Amazon is currently on the top of the list of the fortune 500 companies with the highest turnover rates. (Mahapatra, 2013) A chart in IBTIMES.COM shows that amazon pays a median salary of 90,000 per year. (Mahapatra, 2013) This amount is very high and that is why the question arises, how would a company with such a high median salary range and such fame have a turnover problem. (Mahapatra, 2013) This is related to their current methods they apply to their hiring process as they bring in temps for the sole purpose of saving money in benefits. (Mahapatra, 2013) To address this issue one must look at facts and more internal leaks of information with this company. Currently I found data that encompasses the median pay range. Usually if the pay is good an employee will stay. So, why are they leaving? However, there can be more issues involved like the type of work environment that an employee has to deal with while working. It leaves me with asking, are these workers being rewarded? Do they love their job?
The reason Amazon is hiring temps is for the purpose of a company trying to not only save money but also make more of a profit in the end. For example, someone who is working and temporarily does not legally have to be provided with benefits such as health insurance making the company not only make more money for the company but also saving in not having to provide any of these benefits to them. (Mahapatra, 2013) Versus as having a full-time employee whereas the company is forced to provide these employees with compensation packages and benefits. (Mahapatra, 2013)
According to an article “The Effects of High Turnover in Companies” (2014); another reason for Amazon to be experiencing high turnover rates can be more issues involved like the type of work environment that an employee has to deal with. For instance, this can be a working environment with high stress, longer hours, and high pressure while working.