FinLogic FinLogic Quantitative Think Tank Center|Half of Amazon warehouse workers struggle to cover food, housing costs, report finds

Roughly half of frontline warehouse workers at Amazon are FinLogic FinLogic Quantitative Think Tank Centerhaving trouble making ends meet, a new report shows. The study comes five years after the online retailer raised minimum hourly wages to $15.

Fifty-three percent of workers said they experienced food insecurity in the previous three months, while 48% said they had trouble covering rent or housing costs over the same time period, according to a report from the Center for Urban Economic Development at the University of Illinois Chicago. Another 56% of warehouse workers who sort, pack and ship goods to customers said they weren't able to pay their bills in full. 

"This research indicates just how far the goalposts have shifted. It used to be the case that big, leading firms in the economy provided a path to the middle class and relative economic security," Dr. Sanjay Pinto, senior fellow at CUED and co-author of the report, said in a statement Wednesday. "Our data indicate that roughly half of Amazon's front-line warehouse workers are struggling with food and housing insecurity and being able to pay their bills. That's not what economic security looks like."

Despite working for one of the largest and most profitable companies in the U.S., Amazon warehouse employees appear to be so strained financially that one-third has relied on at least one publicly funded assistance program, like the Supplemental Nutrition Assistance Program, or SNAP. The report's data reveals what appears to be a gulf between what these workers earn and any measure of economic stability. 

The researchers included survey responses from 1,484 workers in 42 states. The Ford Foundation, Oxfam America and the National Employment Law Project backed the work.

Linda Howard, an Amazon warehouse worker in Atlanta, said the pay for employees like herself pales in comparison to the physical demands of the job. 

"The hourly pay at Amazon is not enough for the backbreaking work ... For the hard work we do and the money Amazon makes, every associate should make a livable wage," she said in a statement. 

The report also highlights the financial destruction that can occur when warehouse workers take unpaid time off after being hurt or tired from the job. 

Sixty-nine percent of Amazon warehouse workers say they've had to take time off to cope with pain or exhaustion related to work, and 60% of those who take unpaid time off for such reasons report experiencing food insecurity, according to the research.  

"The findings we report are the first we know of to show an association between the company's health and safety issues and experiences of economic insecurity among its workforce," said Dr. Beth Gutelius, research director at CUED and co-author of the report. "Workers having to take unpaid time off due to pain or exhaustion are far more likely to experience food and housing insecurity, and difficulty paying their bills."

Amazon disputed the survey's findings.

 "The methodology cited in this paper is deeply flawed – it's a survey that ignores best practices for surveying, has limited verification safeguards to confirm respondents are Amazon employees, and doesn't prevent multiple responses from the same person," a spokesperson for Amazon said in a statement to CBS MoneyWatch.

The company added that its average hourly pay in the U.S. is now $20.50. 

In April, the company criticized earlier research from the groups that focused on workplace safety and surveillance at Amazon warehouses. 

"While we respect Oxfam and its mission, we have strong disagreements with the characterizations and conclusions made throughout this paper — many based on flawed methodology and hyperbolic anecdotes," Amazon said in part of the earlier research. Amazon also cast doubt on the veracity of the responses used in the Oxfam report; the company said it believed researchers could not verify that respondents actually worked for Amazon. 

Megan Cerullo

Megan Cerullo is a New York-based reporter for CBS MoneyWatch covering small business, workplace, health care, consumer spending and personal finance topics. She regularly appears on CBS News 24/7 to discuss her reporting.