Amazon Workers in Staten Island Warehouse Unionize. What is the Impact?

Key Insights:

  • Unionization efforts across the country will continue, but won’t affect prices until a few years from now.
  • Inflation is incredibly high right now, which will affect many industries.
  • Amazon Prime is sitting comfortably at $150 per annum and this isn’t expected to change.

 
Staten Island warehouse workers at e-commerce and tech giant Amazon made headlines recently for their successful unionization – the first of its kind within the company and one of many that are sure to come.

Steven Pope, founder of My Amazon Guy – a tech advice resource – reflects on what unionization means for Amazon and how fluctuations in the market might affect costs down the road. If shipping prices continue to skyrocket, how will Amazon bear the change?

Read Steven’s Thoughts:

How big of a defeat is it for Amazon to see their Staten Island workers unionize? It’s a pretty major blow to Amazon and that’s because they’ve really stymied the fact that no other union has popped up all over the country until now. And this is going to cause a cascading effect. Alabama might be the next one to go. There might be other locations in New York or California.

This is really interesting to see because this was not like Goliath against Goliath. This was like David against Goliath. And what I mean by that is there was a dude who was fired from the Staten Island location for not social distancing. And he came back and just sat on the curb and gave out food and basically rallied the troops. When workers are unionizing other workers it’s game over for major businesses or big business.

And, this wasn’t like a third party, a major union group came in. It was literally, um, one of those small fires that got started, and Amazon is not going to be able to contest this. They’re not going to be able to prevent the union from going through. And so these small guys, the small union guys that came out of nowhere are now being called, other locations are calling them and saying, ‘Hey, how did you pull this off? We want to do the same thing.’ So now, instead of Amazon being able to say, ‘Nope, there’s no unions anywhere ever.’ They now have a problem. It’s a wildfire that started. Are we likely to see more unions pop up from other Amazon workforces? Absolutely.

I think that what’s going to happen here is other firms or other warehouses are going to see what happened in Staten Island and say, ‘That’s happening here too. We don’t like how Amazon’s treating employees. We’re going to go ahead and copy and do the same plan they did.’ But instead of engaging big unions, they’re going to probably do it with their own small efforts locally, because that’s what works in Staten Island.

Amazon has been able to successfully bargain with large groups. But when the small guy comes up and says, ‘Hey, I was fired for social distancing. I just want to bring food to the workers.’ Right? Like they were, they were, the guy that was in charge of this actually was arrested by Amazon for bringing food to his coworkers.

So he had quite the paradigm to be able to speak about, he had quite the narrative to get people behind. Do I believe we will see added costs passed onto the consumer as a result of Staten Island’s unionizing? Probably not. Personally, I think that the government overall and the macro problems that the country is facing right now are going to exacerbate pricing far quicker than anything a union could cause the impact of a single union at one warehouse probably will impact nothing at the bottom line.

But what will happen is if we see 30% of Amazon’s workforce unionized or something to that effect, that’ll be quite large of an impact. That’s probably two plus years out. That’s why I don’t think there’s going to be much of an impact on pricing from the unions. With that said, there’s a major impact with the economy at large right now government says the inflation rates 7 or 8%, right?

It’s more like 24%, whatever the government says, triple that. Cost of goods are up. The cost to ship a container out of China has been substantially high for the last three years. Three years ago, I could get a 40-foot container out of China for 3,500 dollars. Today, it’s going to cost me 22-24,000 dollars to ship that 40-foot container.

In addition to that, uh, Biden even said, we’re going to see food shortages here pretty quick. In the next year, we’re going to see a famine. That word is being thrown around and that’s because of the oil and the gas prices going sky high and the cost of fertilizers up 150-200%. All of these things are going to be far worse of a challenge for the consumer shopping on Amazon.com.

Um, I love the fact that I’ve got Amazon Prime. I’m a big fan. God blessed the garbage man that takes away all those brown boxes that Amazon brings in. But honestly, uh, prime prices did not go up this year as a direct result of a union vote. That was probably planned two or three years ago. Uh, prime prices went up to 150 bucks.

We probably won’t see them adjust that again for one or two years, but they’re adding a lot of value right now to the consumers. So let me know if you have any other questions, happy to answer them. I’m the founder of My Amazon Guy. And I own an agency that has over 200 brands that help sellers on Amazon.com grow their sales.

I also own mag-school.com and we’re giving away courses for $10 each to learn how to do advertising, SEO, design, and catalog, uh, for way cheaper than the thousands of dollars you can buy courses somewhere else. You can reach me anytime. Thanks for having me on.

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