The ‘Great Resignation’ is showing no signs of letting up. But one company that is facing long-term staffing problems is Amazon, according to a leaked internal report.

Amazon’s research, which was seen by Vox’s Recode, shows that the e-commerce giant will run out of talent for its US warehouses by 2024. In fact, a few regions, including Phoenix, Arizona, inland California, Memphis, Tennessee, and Wilmington, Delaware, are predicted to run out of talent even sooner.

A major part of the problem is Amazon’s sky-high attrition rate. Amazon’s research shows that the company’s warehouse attrition rate hit 159% in 2020 – this was up from 123% in 2019.

While high attrition rates are expected in warehouse jobs – mainly because many people see them as stop gaps (just think of Oscar-winning film Nomadland and how the main character works at an Amazon warehouse before returning to her nomadic existence) or pit stops on the way to better jobs and careers – Amazon’s rates are much higher than its competitors.

The US Bureau of Labor Statistics showed that the logistics sector’s average attrition was just 59% in 2020 (and 46% in 2021).

Ultimately, the internal state of Amazon’s staff shortages now, but also longer term, should act as a warning to companies looking to emulate the e-commerce giant’s success.

What can Amazon do now to avoid running out of staff in two years, as well as put it more squarely on its path to becoming the ‘Earth’s best employer’, as founder and former CEO Jeff Bezos so desires.

How to become the ‘Earth’s best employer’

It is clear that Amazon needs to address its retention rate. The e-commerce behemoth needs to make it an attractive place to work for the long-term, and avoid losing staff to competitors like Walmart, Target and FedEx.

The leaked Amazon research included a survey of 31,000 workers and many said that working at Amazon was worse than at Walmart or FedEx. This is partly due to the focus on productivity that bring stress, as well as the extreme surveillance of workers and the high injury rates at Amazon warehouse.

These issues are central to why many Amazon workers in the US are looking to unionize – as is the issue of pay. (Amazon pays $18 an hour, whereas Walmart now pays as much as $25)

Amazon’s research found that if it could just return to the 123% attrition rate in 2019 then amazon could buy itself three more years of warehouse labor in the US. The study also found that for every dollar that it raised its wage, it added 7% more workers to the labor pool.

The company also considered introducing longer working hours – currently, Amazon warehouse employees work 27 hours a week, but the research found that increasing that by 10% could mean Amazon would need to hire 118,000 fewer people.

Other solutions to Amazon’s labor shortage is automation, as well as more efficient hiring that doesn’t rule out employees who fail a drug test for marijuana. Cannabis is now legal in many US states, including California, Arizona, and Nevada.

The challenge is that implementing some of these changes involves a shift in mindset from the senior leadership team at Amazon. If they raised wages, they would need to make savings elsewhere or accept a decline in profits.

What would be the reaction to Amazon, one of the US’s biggest employers with more than one million people on its books, leaning towards automation as a labor crisis solution?

Maybe instead of looking at longer hours, pay and automation as major solutions, Amazon needs to learn the lessons of the ‘Great Resignation’ and focus more on employee wellbeing beyond just its WorkingWell initiative.

Remember, happy employees are productive employees – if you nip burnout in the bud, and provide a friendlier workplace less focused on productivity at any cost (including physical injuries), then people will feel a sense of loyalty and want to keep working at Amazon.

Just some food for thought for Amazon, but also all employers grappling with record-high attrition over the past year.

In a statement shared with UNLEASH, Rena Lunak, an Amazon spokesperson, said: “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.

“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.”