Amazon Added 400,000 Jobs During the Pandemic and Jeff Bezos is Selfish?

The unpopular perspective — when “greed” is good.

According to the latest report from the International Labor Organization, the pandemic caused unprecedented global employment losses in 2020 of 114 million jobs relative to 2019.

In terms of income loss, global labor income (before taking into account stimulation packages) in 2020 is estimated to have declined by 8.3 percent, which amounts to US$3.7 trillion, or 4.4 percent of global gross domestic product (GDP). The largest losses were faced by the workforce in the Americas at over 10%.

Whether a direct or an indirect impact, a huge part of the workforce faced a challenging environment in 2020.

Yet, there were some companies that benefited due to the subsequent shift to “online” that the pandemic caused. This also meant a spike in e-commerce businesses — providing access to goods to a homebound world.

One of the biggest or most “in-the-news” beneficiaries was a company called Amazon — one of the biggest companies in the world by market capitalization, founded by the richest man in the world, Jeff Bezos, who for a brief period gave up that title to Elon Musk earlier this year.

The world either loves or hates rich people — loves them if they come across as philanthropic in their endeavors, hates them if they come across as selfish. Warren Buffet and Bill Gates probably fall in the former category — with their philanthropic efforts including but not limited to being part of The Giving Pledge. Jeff Bezos is the other end — he is often hated by the world for being selfish and not choosing to be a member of the Pledge.

Bezos’ criticism doesn’t end there — he’s also come under fire for unsafe employee practices during the pandemic, as well as a whole host of other “unethical” practices to reach the success he has achieved today.

Yet, without going into a verdict on whether Jeff Bezos is a good man or a bad man, which I am no one to judge — I’d like to present a perspective on why Jeff Bezos has likely done the world more good than bad, and may even be a necessary evil for those who want to believe he is evil.

Staggering Employment Contribution in a Job-Starved World

Amazon employs over 1 million people across the globe — i.e. provides jobs to 1 million people who could potentially otherwise add to the unemployment numbers of various countries if Amazon is removed from the equation.

400,000 of these jobs were added during the pandemic, to meet the demands of online shopping. When the whole world was cutting jobs to keep companies afloat, and people were struggling to make ends meet due to the forced changes the pandemic brought, being able to offer employment to people in itself is a huge deal.

It may have been an unintended consequence of the pandemic, but so was everything else. Amazon had put itself in a position where it built a business that was able to cater to the online demand of people who had no other way of purchasing goods in many cases, and also added jobs to the market.

Powering the Exponential Shift to Online

The regular world knows Amazon best for their e-commerce services, but a huge part of what Amazon does is the AWS business — or the Amazon Web Services business.

All the online businesses that have boomed need platforms and infrastructures that power these businesses — and AWS has been a huge part and support system during this period. Yet another way the company has managed to produce an industry-leading product that also enables other businesses.

The Wealth Concentration Debate — Creators vs. Investors

Now the biggest problem or allegation on Jeff Bezos is that he is busy accumulating wealth when the world is suffering.

Here’s my disagreement or issue with that argument. Let us understand what Bezos’ net worth is comprised of. The reason why Bezos is the richest man in the world is that Amazon’s stock soared from a~$500 per share price to $3,000 over the past five years.

Stock prices rise when investors show interest and faith in a stock based on their own financial analyses/assessment and buy more of it i.e. bet on a company to enhance their wealth. Jeff Bezos simply built a company that people see as being value accretive to their portfolios and keep buying it as a result increasing Bezos’ net worth.

Warren Buffet made his wealth largely from “investing” in winners like these, while people like Jeff Bezos and Bill Gates got rich by building companies that continued to make a profit for themselves and their shareholders and got rewarded in the form of their share in the company rising.

So, in all practicality, Bezos is made rich by others and the faith is shown in Amazon by the investors — both institutional and retail. As Amazon goes up in value, so do the portfolios of many institutional investors, who in turn manage money for part of the general public.

The Redistribution of Wealth Argument

The socialists of the world or people who believe in the ideals of socialism argue that the wealth of the richest people should be redistributed to the world.

However, if it was common knowledge that whether you build a massive company from the ground up, or sit on your hands, you’ll get an equal share of the world’s wealth anyway — who will then take the pain to even create any wealth?

It does take certain kinds of people to build, lead and create something of this scale. Capitalism or socialism — none are perfect yet there is merit in each, but the distribution of wealth doesn’t happen via taking money from the rich and giving it to the poor. It happens via the rich creating opportunities for others to share in that wealth. To me, a person building a company that employs millions, in turn adding further to his wealth, but also adding to their own individual wealth, albeit, at different scales, is in a way “distribution of wealth.”

Yet, nothing justifies any “unethical practices” and if that is prevalent, that must be taken care of and corrected. However, if people are out to criticize a man just because he got rich building a company or an empire, that just doesn’t seem like a fair thing to do. There are always two sides to every debate — and it is worth looking at things from a different perspective.