Amazon is sounding the alarm over an internal memo which estimates that the retail giant could run out of people to hire and man their US-based warehouses within the next 18 months, according to a report.
An internal research paper that was viewed by executives at the Seattle-based company warned that failure to replenish the warehouse-based workforce could lead to an overall drop in the quality of service as well as frustrate growth plans, according to Recode.
Amazon could mitigate the impending disaster by raising wages or expediting plans to boost warehouse automation, according to the memo.
But that would only delay the crisis by a few years. Instead, it recommends an overhaul of management’s relationship with employees as well as changes to how it does business.
“If we continue business as usual, Amazon will deplete the available labor supply in the US network by 2024,” according to the memo cited by Recode.
The paper, which was written last year, pinpoints specific geographic regions where the labor shortage is expected to become more acute as time goes on.
By the end of 2021, Amazon was due to have difficulty hiring workers in the Phoenix, Ariz., metropolitan area.
By the end of this year, the company will be facing the prospect of a shorter labor pool in the Inland Empire region of California, just 60 miles east of Los Angeles, according to Recode.
“There are many draft documents written on many subjects across the company that are used to test assumptions and look at different possible scenarios, but aren’t then escalated or used to make decisions,” an Amazon spokesperson told The Post on Friday. “This was one of them. It doesn’t represent the actual situation, and we are continuing to hire well in Phoenix, the Inland Empire, and across the country.”
Amazon’s warehouse workforce of more than 1 million people is key to maintaining its system of online retail and deliveries for customers who use the popular Prime service.
Last year, the New York Times reported that Amazon was willing to tolerate high turnover at its facilities because former CEO Jeff Bezos feared that employees who were at the company for too long would grow complacent on the job.