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Comment by jacek | Hacker News Reader

IMO this is very bad news for the economy. Amazon will do very well as a delivery service, because unlike competition they have underpaid and overworked deliverers. They basically uberified delivery. The costs are much lower, but delivery jobs will shift to low paid, no benefits 'gigs'. Amazon is more and more scary as it monopolizes more and more businesses.

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„...unlike competition they have underpaid and overworked deliverers...“#

This is a pretty accurate general description of the delivery industry per se, not Amazon specific.

Wouldn't that be an indication that the wages are at market?

>at market

Ah yes, the calling card of people that think systematic exploitation of workers in a global economy where only the top few are gaining wealth is fine because "free market rules" matter in a world full of regulatory capture and industries with too high of a barrier to entry to foster true competition.

> high of a barrier to entry to foster true competition.

The article is literally about true competition being attempted in a high-moat business.

This isn't true competition. This is vertical integration.

Amazon isn't offering to deliver Walmart packages for a price.

Actually that's exactly what the article is about. Amazon has already had their own delivery drivers for a long time, they are now directly competing with UPS and FedEx by shipping packages for businesses that don't operate on Amazon's eCommerce platform.

If Amazon loses money on each delivery to stoke its market share, Walmart should use it as its delivery service until Amazon has exhausted its foray into last mile logistics.

That's literally exactly what they're offering. This is directly competing with FedEx/UPS.

"...the new service will entail the online retail giant picking up packages from businesses and shipping them to consumers."""

Because paying for things more than they are worth makes all the sense. Soviet experiment worked out really well!

Of course what Amazon will pay their delivery personnel will match the quality of Amazon service, such as it is, anyway.

I am happy to tip my waiters well. Works out great for me!

Note -- you said tip. And I imagine you tip if you got at least acceptable service (something that looking at comments here doesn't happen too often with AMZL).

When I was a jumper for UPS in my college years, it was known that UPS had the best pay "in the trucking industry." UPS drivers could clear six figures after about 10 years. I think they averaged about 80k.

Now it's true that they worked them to the bone, but they were paid well. Being a UPS driver also comes with a lot of perks. My driver had several lady friends on his route. Most of the business he picked up from loved him and we got lots of Christmas presents.

Not sure if their compensation has kept up with inflation but it wasn't a bad job at all.

I have a facebook friend who is a driver at UPS and she absolutely loves it.

Thanks to the union for that, I think.

Facts. UPS has excellent perks for their employees.

You can make a solid argument UPS delivery folks have better lifetime earnings than physicians:

http://www.er-doctor.com/doctor_income.html

Based on the posts on HN, one of two things will happen:

1. Enough people will say "screw Prime" and Amazon will start trying to figure out how to fix that.

2. The turnover for delivery employees will be so bad, that it will cost Amazon more than if they just paid them better and had better working conditions.

3. Gigster with intent to steal. Absolutely no way to tell lost vs damaged vs misdelivery vs opened & reboxed vs stolen. It just never madr it

It should be pretty easy to identify this based on value of package, etc.

A driver could steal one package, but anything consistent would be quickly detected and dealt with harshly (eg, predict when a sting will be most effective and coordinate with police, etc).

No, not in the "pro-worker" world. Amazon will just continue "exploiting" workers and there will be no consequence. Customers will be completely happy with shitty service.

Maybe this is bad for certain workers, but there's no reason to believe it's bad for the economy. The money saved on paying delivery drivers will be allocated elsewhere.

The offshore accounts of corporate executives?

Perhaps, but also perhaps toward investment.

... in fur coats and diamond jewelry?

What specifically makes them underpaid? Are their wages getting stolen or illegally withheld? Is there some market force that is coercing lower wages than they would get otherwise?

For one political trend that answers your question in part:

According to the Legal Defense Foundation, right-to-work laws prohibit union security agreements, or agreements between employers and labor unions, that govern the extent to which an established union can require employees' membership, payment of union dues, or fees as a condition of employment, either before or after hiring. Right-to-work laws do not aim to provide general guarantee of employment to people seeking work, but rather are a government regulation of the contractual agreements between employers and labor unions that prevents them from excluding non-union workers,[2] or requiring employees to pay a fee to unions that have negotiated the labor contract all the employees work under.

https://en.wikipedia.org/wiki/Right-to-work_law

As noted elsewhere in this subthread, UPS by contrast is unionized (or used to be or is in parts) and seems to offer a livable wage to its drivers.

Whereas the Gig Economy rationalization seems to be: "Show me the gun that was held to your head when you accepted this lousy job."

I don't think Right to Work laws are the problem. I see no issue with not forcing employees to join a union. If the union actually does a good job, employees should want to join the union*.

The issue is that the union provides a public good. Strike for a pay rise? Your non-union colleagues will get that too. Hire a lawyer to sue for better health and safety? Employees who never paid their dues will benefit.

These concerns don't persuade me personally that Right to Work laws are bad. I'm just telling you they exist and probably have some validity.

I worked for UPS for a long time, and if I am understanding what you are saying then no, you must be a due-paying member of the IBT to benefit from contractually-negotiated benefits and pay. UPS corporate has a totally different set of benefits, pay, and expectations from their Teamster counterparts.

I may have misunderstood what you meant though.

Compulsory union membership strengthens collective bargaining by preventing defections. Game theory 101.

https://en.wikipedia.org/wiki/The_Logic_of_Collective_Action

The doublespeak "Right to Work" sabotages collective bargaining, disempowering Labor.

How does that answer the question? Doesn't UPS provide services in right-to-work states as well? And vice-versa for Amazon?

Usually there is actually a gun. People are desperate for jobs, because if you don't work you don't eat.

And exploiting desperate people can lead you down a dark path as a society... provided anyone in the US still gives a shit about empathy, morality and the value of life.

Monopoly: "the exclusive possession or control of the supply or trade in a commodity or service."

Not sure how increasing competition in any space creates a monopoly.

I believe in the implication is that Amazon will cut out the competition because of its cost advantage, leading towards a monopoly, not unlike what it's (trying) to do in many other sectors.

There's a difference between a new entrant appearing, and a firm with a monopolistic presence in one (or more) areas extending vertically into others.

Note that Amazon has a distinct and proven track record of utilising its monopoly position to squeeze competing and complementary firms in other spaces. Notably with Hachette.

http://www.latimes.com/books/jacketcopy/la-et-jc-amazon-and-...

"monopoly" is just a moral classification for something that is "big" now. It doesn't mean lack of competition or have any other strict definition anymore.

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