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Amazon to pay 100% of college tuition, fees, and textbooks for U.S. hourly employees

The -commerce giant's announcement comes on the heels of other retailers offering similar education benefits to workers.

Amazon to pay 100% of college tuition, fees, and textbooks for U.S. hourly employees
BRIESELANG, GERMANY - SEPTEMBER 04: Worker pack orders at an Amazon warehouse on September 4, 2014 in Brieselang, Germany. (Photo by Sean Gallup/Getty Images)

Amazon has announced that it will cover 100 percent of college tuition for its 750,000 hourly employees in America. The e-commerce giant made the announcement after rival retailers including Target and Walmart offered similar education benefits to workers. Big businesses have been forced to offer better pay and benefits due to acute worker shortages. Amazon said the education benefits offered will include college tuition, fees, and textbooks for hourly employees and will start from January 2022, reported NBC News. The benefits will be available to hourly workers in the company's operations network, including warehouses and distribution centers, after 90 days of employment.



Amazon said the offer will apply to education institutions across the country and cover high school diploma programs, GEDs, and English as a second language certification courses for employees. The retailer had initially offered to pay 95 percent of tuition for hourly associates through its career choice program but has now announced it'll cover 100 percent. Retailers are enticing workers back to work with better pay and benefits to make fight the worker shortage. In some parts of America, Amazon is also offering sign-on bonuses for new employees worth up to $3,000.

BRIESELANG, GERMANY - SEPTEMBER 04: A worker pushes a cart through shelves lined with goods at an Amazon warehouse on September 4, 2014 in Brieselang, Germany. Germany is online retailer Amazon's second largest market after the USA. Amazon is currently in a standoff with several book publishers over sales conditions and prices for e-books, and hundreds of authors in the US and Europe have written letters in support of the publishers. (Photo by Sean Gallup/Getty Images)


Walmart announced in July that it would cover 100 percent of college tuition and books costs for associates of Walmart and Sam’s Club. Following this, Target responded in August, announcing a program to cover the cost of associate and undergraduate degrees at select schools. Amazon has now responded with education benefits to lure workers to the company. 



Amazon CFO Brian Olsavsky said the competitive labor market was leading to higher costs. “We’re spending a lot of money on signing and incentives, and while we have very good staffing levels, it’s not without a cost,” said Olsavsky. “It’s a very competitive labor market out there.” Amazon's business has boomed during the pandemic and has been hiring prolifically, bringing onboard 500,000 employees in 2020 alone. Amazon is paying up to $17 an hour in many places. In May, Amazon announced that it was hiring 750,000 workers for its warehouse and delivery network in the U.S. and Canada.


Many workers were apprehensive about returning to work when businesses reopened earlier this year. They appear workers to have weighed in the option of being underpaid and risking catching the virus against sitting in the safety of their home and receiving benefit expansions. Some employees, who are parents, didn't have anywhere to drop off their children with schools closed earlier this year. The labor shortage combined with a sharp rise in customers has put businesses in a fix, leaving many with no option other than increase their wages to meet the rising customer demand. 



Many big companies in retail and service industries increased their hourly wages. As we reported, The likes of McDonald’s, Sheetz, Chipotle, Amazon, Walmart, and Costco raised their wages to $15 an hour or even higher. This has sparked a debate online with many stating that it highlighted that businesses could always afford to raise the wages and offer benefits to workers, but chose not to. Workers' hourly wages haven't kept up with inflation leading to today's employees having less purchasing power than their previous generations. This widened the income inequality gap in the country. The federal minimum wage in America hasn't risen for more than 10 years and according to The Center for Economic and Policy Research (CEPR), if the minimum wage did rise in step with productivity growth since 1968, it would be over $24 an hour today.

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