Data Point

Amazon’s Exploding Employee Base

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Source: Company Filings

Amazon often gets lumped in with other big tech companies like Google, Apple or Microsoft. But there’s one way it diverges from its peers: Its workforce is exploding, growing by 50 percent over the past year to nearly double the size of its nearest headcount competitor, Microsoft. (See accompanying chart.)

More people are buying more stuff on Amazon, which means Amazon has to hire more people to shuffle physical goods around its warehouses. The vast majority of its now 230,800-strong workforce are employed picking and packing goods at its 123 fulfillment centers and 23 sorting centers. (They get a mechanical hand from about 30,000 robots.)

And even though Amazon has delivered a slight profit for the past three quarters, the increased headcount is showing up in the company's costs. For the past two years, its fulfillment costs have increased as a proportion of revenue. Continuing to add bodies to move goods could be a very expensive game of growth for Amazon.

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Taken together, these four factors paint a complicated picture for Amazon’s headcount growth. It’s certainly a different beast from its technology contemporaries like Apple or Google. The question seems to be how quickly the company can make labor-intensive services that customers enjoy, like Prime shipping on third-party items or quick delivery with Prime Now, into profitable businesses.


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