Just in time for its busiest season, Amazon has raised wages for its frontline workers, bringing their starting pay to $20 per hour. The boost amounts to a $1 increase in minimum hourly wages for the hundreds of thousands of workers who staff the company’s warehouses. 

The new pay increase comes just as Amazon is gearing up for the holidays, when the tech giant sees a massive boost in orders. Historically Amazon has staffed up in anticipation of this period, hiring an estimated 250,000 additional workers last year—accounting for about half of seasonal hires across the entire retail sector. 

Amazon claims that its minimum pay has ticked up by about 17% in the last three years, and that average pay across its hourly workforce is actually higher, at nearly $24 per hour. The company is also giving its workers access to a new banking benefit and grocery discount; when employee benefits are taken into account, average total compensation is more like $32 per hour, according to Amazon. 

This puts Amazon pay above the minimum wage in many parts of the U.S., even as legislation has raised hourly wages across countless states and localities. By the end of 2026, the minimum wage will have crossed $15 in 14 states and 65 cities and counties, according to the National Employment Law Project; across many of those states and localities, the hourly wage will be $17 or higher by year’s end. In Seattle, where Amazon is headquartered, the minimum wage now exceeds $21. 

But Amazon’s wages are hardly out of the ordinary among other retailers. 

While hourly pay at Walmart starts at $14, the company says average pay for frontline workers is more than $18.50 per hour; those who work in fulfillment and distribution centers can earn anywhere from $17.85 to $40.40 per hour. At Target, hourly wages range from $15 to $24 depending on location; average pay for frontline staff is $18.50. And as of last year, Costco’s starting wage for entry-level workers rose to $20 per hour; average hourly pay across the company is $31 or higher. 

Even as Amazon increases wages for its hourly workers, however, the company’s investments in automation appear to be simultaneously culling its warehouse staff. 

As Fast Company has reported, Amazon started trimming head count across certain teams, outsourcing parts of its HR process to an AI chatbot; these changes have already reduced the number of HR workers who are on the floor in warehouses. Over the past two years, Amazon has also slashed tens of thousands of jobs to eliminate management layers and increase efficiency, though the company has denied those layoffs are driven by AI. 

Amazon now has more than a million robots operating in its warehouses. A New York Times report last year suggested the company would be able to avoid hiring nearly 600,000 people in the coming years due to that automation—which means fewer workers may stand to benefit from the company’s pay bump.

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