New York
CNN
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Amazon is raising wages for its more than 800,000 U.S. warehouse and shipping workers and offering them free Amazon Prime.

Amazon, one of the nation’s largest private employers, announced Wednesday that it will raise wages by at least $1.50 per hour, bringing the company’s average starting salary to more than $22 per hour. Amazon will also offer its $139 annual Prime benefit for free to employees.

Amazon’s decision to raise wages is another sign of a tight labor market for logistics workers, fueled by more Americans shopping online. The labor market has cooled significantly over the past year, but the economy is still adding jobs.

The average hourly wage for transportation and warehouse workers rose to $30.79 in August, a 22% increase from August 2020, the Labor Department said. There were more than 460,000 unfilled positions in the transportation and warehouse sector in July, the Labor Department said.

Rivals UPS, Walmart and Target have also raised wages for warehouse workers. UPS signed a five-year contract with the Teamsters union last year, which included a starting salary increase to $23 an hour for the duration of the contract.

Amazon’s pay hike comes ahead of the holiday season, typically the busiest online shopping season of the year. Deloitte predicted in a report last week that sales will rise 3.3 percent this holiday season. Online sales will grow 9 percent.

Amazon is also closely monitored regarding safety and working conditions in its warehouses.

An investigation by the Senate Health, Education, Labor and Pensions Committee found that Amazon’s warehouses are especially dangerous for workers during the company’s annual Prime Day event and the holiday season. The company’s workers have repeatedly made headlines, with persistent complaints about the “grueling” experience of running around warehouses that can be the size of 28 football fields, while the company tracks their every move.

Amazon said Wednesday it has made progress on worker safety, saying work-related injuries have decreased by 28% and serious injuries by 75% over the past five years.