Automation and innovation are changing the way retailers handle the holidays.
In the first quarter of this year, Amazon added $7 billion in gross profit. To put that in perspective, that’s more than the growth expected from the top five retailers combined.
Amazon’s business is growing at a staggering rate – that much is clear. Given that, you’d assume they were hiring holiday rush workers at a rate commensurate with their growth, right?
Amazon is staffing up for the holiday rush with around 100,000 additional hires. As big as that number sounds, it’s actually fewer people than the e-commerce giant added in either the 2016 or 2017 holiday seasons, when it brought in 120,000 additional workers.
Citi analyst Mark May says he thinks the reduction in seasonal hiring is strong evidence that Amazon is succeeding with plans to automate operations in its warehouses.
“We’ve seen an acceleration in the use of robots within their fulfillment centers, and that has corresponded with fewer and fewer workers that they’re hiring around the holidays,” May told CNBC on Nov. 2. He added that 2018 is the “first time on record” Amazon plans to hire fewer holiday workers than it did the previous year.
That’s right – they are actually hiring fewer people to conduct more business.
Meet the Robots
How are robots taking these jobs? Advances in artificial intelligence and robotics have yielded greater and greater sophistication.
Warehouses now utilize robots who can transport 3,500 pounds of product at once. Other robots are able to sort and stock products with a mechanical claw, increasing their accuracy as they learn from prior sorts. Still other robots can autonomously move around the warehouse, running a perpetual scan on the shelves to live update the company’s inventory.
Check out these robots in action. Impressive, right? As this technology continues to improve, there’s just no way a human could keep up.
So Is This the End for Holiday Jobs?
Not quite. As technology has destroyed some jobs, it has created others.
In fact, temporary workers looking for holiday jobs now have more options than ever. Amazon may not be hiring as many warehouse workers. But workers have new opportunities, too. Forget warehouses. Now you can put up Christmas lights as a TaskRabbit or drive holiday travelers to the airport as an Uber driver – and you can set your own schedule for it, too.
Warehouse employees might go the way of buggy-whip makers. But that doesn’t mean there aren’t new work opportunities available for them. And we, as a nation, should work to ensure our labor force is ready to adapt to this changing landscape.