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Amazon was among a flurry of tech companies that actually consolidated their power during the pandemic, joined by players like videoconferencing leader Zoom, social networking giant Facebook and streaming services like Netflix and Google’s YouTube. But it wasn’t all smooth sailing, and some of Amazon’s success has drawn the gaze of regulators who are worried that it may have gotten too powerful.
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Amazon became our everything in 2020
The online retail giant became a lifeline to the millions of Americans who were locked down thanks to the pandemic.
To say the coronavirus had an impact on Amazon would be a massive understatement — the pandemic sparked a seismic shift in the role that the online retail giant plays in the lives of millions of Americans. Few companies benefited more from the lockdown measures that kept most of us at home — turning Amazon into a lifeline for basic needs like toilet paper and sanitary wipes, and indulgences like the latest sourdough kit and inflatable swimming pool, too.
Like most companies, Amazon was hit hard by the initial shock of the pandemic, which forced pretty much everyone into their homes in an effort to halt the spread of COVID-19. But after smoothing out early supply and pricing issues, the company began to reassert its dominance as consumers sought more online options for necessities like groceries. In the third quarter alone, it posted a profit of $6.3 billion — even after spending $2.5 billion on COVID-19 related costs, and without the usual Prime Day boost.
Coping with the early lockdown
The early days of the pandemic were marked by price gouging for items like face masks and hand sanitizer. Toilet paper was a hot item — the hallmark of a looming apocalypse. Amazon’s vaunted two-day shipping promise strained against huge demand, and when you’d actually get that package would shift from day to day. Unlike many other companies that were forced to lay off employees, Amazon instead went on a hiring spree. After bringing on 175,000 workers in the first half, it committed to hiring another 100,000 to work in its warehouses. Keep in mind, the company brought 200,000 workers on board for the holiday season last year, so these kinds of big bursts are a semiregular phenomenon.
But Amazon felt the heat from its existing workers, some of whom were vocal about the lack of protections provided in the warehouse: In April, 300 employees staged a protest across 50 facilities. The controversy boiled over when the retail giant fired several warehouse employees who spoke out about its working conditions. Amazon said the fired employees violated its conduct guidelines, adding that while it respects workers’ rights, it hasn’t offered “blanket immunity against any and all internal policies.” In a May shareholder meeting, CEO Jeff Bezos defended the firings, and said the company didn’t terminate anyone for talking about working conditions.