Amazon and the Pandemic

The economic crisis engendered by the pandemic was lucrative for tech firms, particularly the “Big Five” — Apple, Microsoft, Alphabet (Google), Amazon, and Meta (Facebook). The predominant reason is clear enough — delivery services and those that facilitate remote working boomed.

None benefited more than Amazon, closely connected to productive accumulation due to its crucial role in the distribution sector. The other Big Tech companies operate somewhat separately from the rest of production, in a sphere unto themselves that is not yet quite as crucial to the overall economy as is often imagined. According to its earnings report for 2021, Amazon made $33.4 billion profits last year, up from $11.6 billion in 2019. Executive chair Jeff Bezos increased his net worth during the pandemic by approximately $80 billion — reaching $193 billion by 2022.

Big Tech also gained enormously from the central banks’ pursuit of quantitative easing, driving interest rates close to zero, and consequently creating a stock-market bubble. The companies’ increase in market capitalization (table 1) is revealing, even if much of this value is clearly fictitious capital that exists only as unrealized capital gains. But even if some of this growth disappears as stock markets adjust, there is no doubt that the Big Five were the undoubted winners of quantitative easing.

Table 1. Change in Big Five market capitalization ($Tr), April 2019–2022.

The growth in capitalization, furthermore, reflects Big Tech’s sustained effort to expand into the cloud computing and artificial intelligence markets, which underlie technological change today, having expanded under the pandemic. In 2020–21, Big Tech sought to acquire an increasing number of AI start-ups. Their aggressive moves are reshaping the gig economy, influencing the contours of accumulation across the economy.

Amazon Web Services (AWS), the web-services arm of Amazon, leads the industry in this category of investment and service provision. AWS has been rapidly widening its customer base and expanding both geographically and across sectors. Despite competition from Chinese giants — above all, Alibaba — AWS dominates even the Asia-Pacific Region.

These technologies require enormous investment. It is estimated that spending on public cloud services rose from $313 billion in 2020 to $396 billion in 2021, and will reach $482 billion in 2022. By 2026, expenditure on cloud services is expected to be roughly half of all enterprise IT spending.

In short, Amazon, a giant enterprise that was initially focused on digital commerce, is on its way to becoming a force that not only dictates the global conditions of distribution but also the development of digital services and advanced technological investment generally.

The Amazon Labor Model

For workers, the growth of digital technology represents the intensification of labor and the extension of the working day. The new technologies also increase the insecurity of employment, making jobs even more precarious. Not least, the new technologies could also intensify competition across the world economy, worsening labor conditions further.

Labor conditions at Amazon are a prime example of these trends. The dizzying ascent of the company has allowed it to expand its labor force to more than 1.6 million people worldwide. To manage them, Amazon is aggressively incorporating the new technologies that it is simultaneously developing, dictating the configuration of labor conditions for the leading industries in the years ahead.

A large part of Amazon’s increased labor force includes seasonal workers, employed to address growing demand-side pressures. They face acute employment insecurity, as they are easily dispensable once demand for Amazon services fluctuates downward. Amazon warehouses have recently witnessed an incredible turnover rate, going through more than 100 percent of their workforce every year.

Conditions at Amazon warehouses are degrading, bordering on the inhumane. Amazon deploys an alarming AI-based surveillance system of its warehouse and delivery services. Within the warehouses, any failure to follow the pace of work and fulfill the daily targets results in disciplinary action for being “unproductive.”

Published documents indicate that Amazon is aware of its workers having to urinate in bottles to avoid being fired for taking time off work. Amazon’s treatment of workers further includes stealing tips received by its delivery people as well as concealing that its “automated” factories can be death traps for employees.

Matters became notably worse during the pandemic as workers were systematically exposed to the virus while Amazon enormously expanded its sales. It is important to remember that the struggle in Staten Island began as Chris Smalls, the leader of ALU, initially walked out to protest against the opacity of Amazon’s health and safety measures.

Despite the best efforts of big business, the ability of wage workers to resist is inexhaustible. The fundamental opposition between capital and labor at the foundations of modern society cannot be willed away. Ruthless harassment of the Amazon labor force by management resulted in a victory for unionization that has timely lessons for the labor movement and the Left.

The ALU’s Victory

Amazon’s JFK8 facility is located at the northwest margins of Staten Island in New York and was once a huge oil and gas storage area. The industrial zone lies not far from the shining skyscrapers of Manhattan’s financial district, Brooklyn’s gentrifying neighborhoods, and the rich enclave of Todt Hill. Workers at the facility live in one of the world’s most expensive cities, a harsh reality for the vast majority.

The unionization drive was led by the ALU, which is organized as an independent union, separate from the major union federations that dominate what remains of organized American labor. The principles of ALU include a committed anti-racism, and its leadership reflects the diverse racial composition of the warehouse.

ALU principles further include a broad left-wing commitment. As Justine of the ALU put it, the union has been actively “outspoken against the billionaire class.” The impact of left-wing activists has been clear, with the union deliberately learning from the traditions of the International Workers of the World and the Congress of Industrial Organizations. They carefully read the reference work Organizing Methods in the Steel Industry by William Z. Foster, the famed labor leader and communist. The experience and participation of the Left also helped introduce flexible tactics, from collective action to legal challenges against management. Not least, it involved a willingness to accept help from other unions and political organizations of the Left.

A key reason for the success of the struggle in Staten Island was that all members of the union leadership are currently, or were formerly, workers at Amazon, and have firsthand experience of the realities of its facilities. Another reason was that ALU is independent, as compared to the Retail, Wholesale and Department Store Union (RWDSU) that led the unsuccessful unionization drives in Bessemer, Alabama. RWDSU was largely thwarted by Amazon’s anti-union campaign that the union was made up of “outside agitators,” a strategy they could not replicate effectively in Staten Island.

This is not to suggest the fight lacked support from more established unions, including the United Food and Commercial Workers union and UNITE HERE. The unionization effort also received some support from Democratic politicians in New York, reflected, for instance, in state attorney general Letitia James’s campaign against Amazon’s dangerous labor practices during the pandemic.

Nonetheless, it is crucial that ALU is worker-led and independently organized. For Pat, an ALU organizer previously part of the International Longshoremen’s Association, “other powerful unions tried to get into Amazon, they just could not succeed. They made it happen with the independence of the workers, so I believe it should stay like this.”

A further vital aspect of the organizing effort was to tackle problems other than remuneration in the workplace. Amazon’s wages might be higher (albeit still barely at subsistence level) than other competitors such as Walmart or Target, but working conditions are worse. Enthusiasm for ALU was helped by its strong stance against sexual harassment and racism, and for dignity in the workplace.

Finally, in the fraught conditions of the pandemic, even minor events proved crucial to unionizing workers. Before the pandemic, workers at the Staten Island warehouse were forced to leave their cell phones in lockers, denying them the chance to listen to music or get in touch with others during working hours. The lockers were largely shared, leading to theft and misplacement. Their distance from the workspace also meant that trying to use phones during a break would effectively take up the entire break time, even preventing workers from going to the bathroom.

Although Amazon was forced to roll back this policy at the peak of the pandemic, it reintroduced it subsequently. Given the extremely high turnover rate of workers at Staten Island, the new employees had no memory of the previous practice. They were very unwilling to accept this seemingly novel repressive intervention, furthering support for the union.

What Next?

During the decades of neoliberalism, the political strength of the Left declined in many leading capitalist countries. At the same time, the Left has been able to mount effective political campaigns and to make a bid for — or even win — political power.

Syriza governed Greece from 2015 to 2019, Podemos enjoyed a period of extraordinary growth and influence in Spain, and the Labour Party under Jeremy Corbyn came close to winning elections in the UK. Bernie Sanders’s campaigns in 2016 and 2020 also challenged the American political establishment.

Yet on all those occasions, the Left failed to enact real change or make long-term gains. It is true that the center left has accepted and even implemented neoliberal policy. The failure of the radical left, on the contrary, was not necessarily due to any programmatic reluctance to challenge capitalism. The real problem was that it was unable to rebuild its historic trade union and political connections with the working class. Despite occasional electoral surges, its political demise ultimately reflects the lack of strong foundations in organized labor.

What does the successful unionization effort at Amazon tell us at such a critical juncture?

One key lesson for organizing the new working class is apparent: it will not be an easy process. Technological surveillance, corporate hostility and propaganda, and the automation of production create major difficulties for organizing. Amazon has recently banned even using the words “union” or “pay raises” in internal company chats. Amazon previously went even as far as to alter traffic lights near their warehouses to prevent trade unionists taking advantage of lights turning red to talk to delivery workers.

The tech giant, and others like it, will be relentless in its opposition to workers uniting. The real difficulties for the ALU lie ahead. It must first achieve recognition by Amazon, and it must then engage in negotiating a contract. To succeed, it will require an understanding of the deeper workings of capitalism.

But there are reasons to be hopeful. The ALU’s success shows that campaigns run with a strong left-wing commitment by independent, worker-led unions that reflect the changing face of the new working class can indeed be successful. The advances of technology and the vicissitudes of the pandemic have undoubtedly been harmful to the cause of labor, but they have also provided fresh openings for organizing. Technological surveillance has made clandestine organizing more difficult, and yet technology has also ensured widespread publicity for worker successes while revealing the callousness of big business.

Chris Smalls, the leader of ALU, told us:

We are still in the beginning stages, so there’s a lot for me to learn. What we have learned so far is that there is nothing we can’t do and overcome. What we want organized labor to learn is that there is a new generation . . . and a new style on how we want to do things, compared to the way it’s been done in the past. We are going to do things our way and our way may not look pretty all the time, but it works.

Wage labor remains the foundation of capitalist society. The regeneration of the Left must be based on repairing its frayed connections with the working class. The victory of the ALU provides a lesson in how to engage with workers on new terms. The Left can mobilize its rich historical experience to support labor and, more importantly, learn from labor on how to take the fight to capital again.