Ecommerce wage boom

By / 9.7.2018

The ecommerce revolution is driving an employment and wage boom in the warehousing industry. Over the past 3 years, the number of production and nonsupervisory workers in general warehousing has gone from 642K to 810K, propelled by the rapid expansion of ecommerce fulfillment centers around the country.

Our earlier research showed that ecommerce fulfillment centers pay about 30% more than brick-and-mortar retail jobs in the same area. That’s the best comparison, since presumably ecommerce is shifting jobs from brick-and-mortar retail to fulfillment centers.

But equally important, the rapid growth of ecommerce fulfillment centers is driving up demand for workers, leading to soaring real wages. Over the past three years, real hourly earnings for productivity and nonsupervisory workers in general warehousing has risen by 10.4%. By comparison, real wages for production and nonsupervisory workers in the private sector as a whole are up only 2.8%. In healthcare, the comparable figure is up only 2.0%.

Now, I don’t pretend there aren’t issues. Fulfillment center jobs are not easy work, requiring much more physical labor than offices or brick-and-mortar retail.  There’s an open question of what a career ladder looks like in ecommerce. And we know from past technological revolutions that capital-labor conflict doesn’t disappear even when the overall economic pie is growing.

But in the big picture, ecommerce labor markets are behaving exactly as we would hope–strong demand and high productivity are driving up real wages for ecommerce workers. In fact, ecommerce is one of the few sectors producing big wage gains for less skilled workers, and they should lauded rather than demonized.