The pandemic has been good to big US retail firms – to their workers, less so

Something doesn’t add up in the United States. Profits at retail companies are booming due to the Covid-19 pandemic. But the retail workers who have ensured those profits while facing serious health risks, are being rewarded with paltry pay rises.

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Take Amazon for instance. In just three financial quarters of 2020, the company has earned almost $6bn more profit than it did in all four quarters of 2019. Meanwhile, Amazon workers have seen a $0.95 increase in their hourly wage from $15. For a clearer comparison, Amazon’s profits increased by 70% while workers’ pay increased by 6%.

A report from the non-partisan thinktank Brookings found that Amazon could have quadrupled the hazard pay it gave frontline workers (an extra $2 per hour which was given from mid-March to the end of May) and the company would have still earned more profit than the previous year.

Though Amazon saw the biggest increases in its profits, it was not the only retail company that failed to pass profits along to employees. Starting wages at Walmart are even lower ($11 per hour) and increased by just 6% (an additional $0.63 per hour). Meanwhile, Walmart’s profits have soared during the pandemic, growing by 45%, or an extra $4.9bn. Similarly huge discrepancies were seen at CVS and Dollar General.

There were, however, a few companies that were praised by Brookings in its November research. After the company’s profits rose by $88m, Best Buy offered permanent wage increases to its employees. Workers there now start on a wage of $15 per hour rather than $11. The retail giant Target was also praised for offering a similar wage increase to its workers.

Retail sales workers are the largest occupational group in the United States. More than 4.6 million people in the US worked in retail sales in 2019 according to the Bureau of Labor Statistics. Despite the Covid-19 pandemic, most of these workers have zero days of paid leave. The United States is the only wealthy country in the world to not ensure employees have this basic right.