Amazon Raised Minimum Starting Wage to $20
The retail giant increased pay for core operations employees to compete for talent during the busy shopping season.
Updated on Sept. 27, 2026 in Employment
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Amazon has raised the minimum starting hourly wage for its full-time core operations employees to $20. This move includes a $1 hourly pay increase for eligible staff intended to boost loyalty and reliability ahead of the holiday season.
Why it matters
Retaining experienced workers reduces costs associated with hiring and training new staff. Higher wages are also a key strategy for the company to maintain reliable service levels as consumer demand shifts throughout the year.
Amazon has set its new minimum starting wage at $20 per hour, reflecting a $1 hourly increase for eligible employees. This comes as the company maintains an average starting wage of approximately $24 per hour.
The players
Amazon
Amazon is a global technology and retail corporation that employs more than 1.58 million people worldwide.
Costco
Costco is a membership-based warehouse retailer known for maintaining high employee retention rates and competitive wage structures.
First Tech Federal Credit Union
First Tech Federal Credit Union is a financial institution partnering with Amazon to offer new banking benefits to staff.
U.S. Department of Labor
The U.S. Department of Labor is the federal agency responsible for enforcing workplace standards and occupational safety regulations.
The details
In addition to the base pay hike, Amazon introduced new benefits including grocery discounts and banking services through a partnership with First Tech Federal Credit Union. The initiative follows competitive shifts in the retail labor market, where peers like Costco have also adjusted compensation structures to maintain high retention rates.
Timeline
September 27, 2026: Amazon announced the $1 hourly wage increase.
2025: Costco raised its minimum starting wage to $20 per hour.
End of fiscal 2025: Costco reached an average hourly rate of $32 for U.S. employees.
2024: The U.S. Department of Labor settled an ergonomics case with Amazon.
Macro View
Amazon's focus on wage-driven retention mirrors the high-retention model proven by competitors such as the 2025 Costco employee retention rate of 94% for tenured staff. This move aligns with broader retail efforts to stabilize workforces during high-volume periods.
Eligible employees in the United States will see an increase in their paychecks as the company rolls out these adjustments. For shoppers, these labor investments aim to ensure consistent service and delivery reliability during the high-demand holiday season.
The takeaway
Companies are increasingly using higher base wages and expanded benefit packages to minimize the high costs associated with employee turnover. This competitive trend suggests that major retailers are prioritizing staff stability as a core pillar of their operational strategy.
Further reading
For more on shifting workforce trends, visit Employment.
Source note: This article includes information reported by The Telegraph.
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