Industry Watches as Amazon Warehouse in Alabama Nears Unionization

Employees at an Amazon warehouse facility in Bessemer, Ala., are considering unionizing with more than 5,800 employees planning to vote on forming a union in the coming weeks. If the vote passes, this will become the first Amazon warehouse to unionize.

If the vote passes, it will be a key development for Amazon, which has famously resisted unionization at its properties and has been pressing hard for this vote to go its way.

The warehouse and logistics industry as well is watching the development closely. ”It could have a tremendous domino effect, particularly if this is a successful union campaign,” said Joshua Freeman, distinguished professor of history at Queens College and the Graduate Center of the City University of New York, in an interview with S&P Global Market Intelligence. “I think it could have a huge impact, not just on Amazon but across the whole industry.”

A union will automatically trigger negotiations over wages, safety and general worker conditions. Starting wages in the Alabama warehouse are $15.30. S&P Global notes that this exceeds the current push for a $15 per hour minimum wage.

However, the decision to unionize is likely motivated by more than increased wages. The pandemic has illuminated worker rights and health and safety concerns. Workers participating in the vote are likely looking to take a more active role in decisions related to working conditions. In an interview with S&P Global, Patricia Campos-Medina of the Worker Institute said that the pandemic has highlighted the importance of frontline workers and the role that they have played in delivering goods during the last year.

Amazon is actively discouraging the union vote in what Stuart Appelbaum, the president of the Retail, Wholesale and Department Store Union said is the most aggressive anti-union campaign that he has seen, telling S&P Global in an interview, “”We’ve been told that just about every other commercial on the local TV station is a feel-good commercial about Amazon.”

Warehouse labor availability and costs is one of the major risks in the logistics market today. This union vote has the potential to exacerbate those challenges. While there has been wild enthusiasm for logistics investment and growth this year, a recent report from Green Street advises caution due to potential labor challenges, among other reasons, like the cost of transporting goods and tech advancements that could impact warehouse operations.

This dynamic makes the Amazon all the more important to watch. It could be a trigger that significantly changes the fundamentals of the logistics market.