Around the world in cart
Christopher Mims had just embarked on his study of the global retail supply chain when the Covid-19 pandemic erupted. Quickly, he discovered, affluent consumers redoubled their efforts in the face of the very activity Mims was investigating:
“Confronted with the stark reality of their inability to do anything else, and primed by a life of consumerism to think that the answer to the existential terror at the heart of their being is to buy more things Americans, with everyone on. Earth with the means do it, will go shopping. (Page 6-7; all quotes here come from Arrive today)
Arriving Today is published by Harper collins, September 2021.
More than ever, shopping during the pandemic meant shopping online. This added complications to the global logistics systems that Mims was studying, and added another strand to the story he weaves into Arrive Today: From Factory to Front Door – Why Everything Has Changed About How and What We Buy. (Harper collins, 2021)
The book traces the movements of a single typical online purchase – a USB charger – from the time it leaves a factory in Vietnam until it is delivered to a buyer in the United States. It sounds simple enough, but it’s an extremely complicated story, which Sims tells very well.
In doing so, he delves into the history and present of containerized shipping; the working conditions of seafarers, stevedores, truckers and warehouse workers; why items are strewn across a “distribution center” the same way data files are strewn across a computer drive; the great difficulty of teaching a robot to pick up flexible packaging wrapped in plastic film; and why no supercomputer can calculate the best route for a UPS driver to take to make a hundred or more deliveries in an average day.
How long can this system continue to eat up more resources, more small businesses, more lives? If there’s one major weakness in the treatment of The Sims, it’s in suggesting that the online retail juggernaut must, inevitably, continue to grow indefinitely.
A key question that is missing from the book is the energy cost of the global supply chain. Sims, however, pays great attention to the brutal working conditions and relentless exploitation of workers in many segments of the delivery system. At the very least, this evidence should raise the question of when a tipping point will be reached. When, for example, might workers or voters be pressured into organizing an effective counterforce against insatiable billionaires like Jeff Bezos? When, more grimly, might the portion of the population with discretionary income become so small that it can no longer support the consumer economy?
“Taylorism – the dominant ideology of the modern world”
The common thread running through Sims’ presentation is: “Taylorism” – the early 20th century management practice of breaking down factory work into discrete movements that can be “streamlined” to increase company profits. – has now transformed many other sectors into assembly lines. Today, writes Sims, “the factory walls have dissolved. Every day more and more of what we do, how we consume, and even how we think, is now part of the factory system.
The factory system, according to the Sims tale, now spans across oceans and continents. It finds clear expression in facilities owned or controlled by Amazon’s management practices. In Amazon’s sorting, packaging, and shipping facilities, what makes the company “uniquely Darwinian” is the floating rate that consistently and coldly judges employees.
With warehouse work divided into discrete, measurable and countable tasks, management algorithms continuously track the number of operations performed by each worker. Those who rank in the bottom 25% are systematically made redundant and replaced. As a result, writes Sims, “most Amazon warehouse workers are in constant danger of losing their jobs, and they know it.”
There is no paid sick leave, so cash-strapped employees often have no choice but to work even when injured or sick. (Free coffee and ibuprofen are made available to them to help them overcome fatigue or pain.) But if poor health results in decreased performance, they won’t get the rate and will be laid off. Those who are exceptionally fit and rarely get sick are always at risk of being exhausted by the relentless pace.
To replace the workers, says Sims, “the company has virtually abandoned interviewing new hires.” Selecting and training new employees can be an expensive process, but they are processes in which Amazon invests little. A constant cohort of new hires are dropped into the creek and they just sink or swim:
“Everyone I spoke to about their first few months at Amazon said the attrition rate they saw was over 50% in the first two months. “(Page 209)
Some companies may view high turnover as a huge handicap. For Amazon, Sims explains, high revenue isn’t a bug, it’s a feature. Turnover allows the company to “capture only the most able-bodied members of the American workforce” (page 235) and constantly replace them with new employees who have not yet fallen ill or wounded.
If that weren’t enough, the high turnover benefits Amazon in another important way: “it makes it almost impossible for workers to organize.” (page 210)
UPS trucks in Manhattan, 2010. Photo by Jeremy Vandel, licensed under the Creative Commons Attribution-NonCommercial License.
The last mile
“[Amazon’s] Relentless metrics, efficiency-seeking, flexible hiring standards, and rolling targets for hourly rates are the perfect system to ingest as many people as possible and wipe out all but the fittest. “(Pages 235-236)
As Amazon’s share of retail purchases grows and taylorizes its warehousing, there is another important link in the supply chain where the company sees the opportunity to reduce worker compensation and ” increase corporate profits.
Until recently, the movement of packages between sorting centers and along the “last mile” to customer gates was controlled by a wide variety of trucking companies. One of the largest of these companies, UPS, is a throwback to the days when most truck drivers were unionized, well paid, and had perks like paid sick leave, company health insurance. and pensions.
A UPS driver is well trained, often very experienced, and learns to “go from stopping a truck to exiting a package in nine seconds”. (page 271) But a full-time driver for UPS also earns over $ 30 / hour plus fringe benefits. Jeff Bezos, who increased his wealth by $ 65 billion in the first year of the pandemic, covets that UPS driver’s paycheck, as well as the paycheck of anyone else in the supply chain whose work, if it can’t be robotic, might be entrusted to a minimum wage worker, alias “independent contractor”.
UPS and FedEx, writes Sims, together own 80% of the package delivery business in the United States. FedEx, along with almost every other parcel delivery company, pays roughly minimum wage, with minimal benefits. Want to guess which company Amazon would like to emulate?
Indeed, from 2018, Amazon itself entered the delivery business. “By the mid-2020s,” writes Sims, “Amazon Logistics… should take the top spot from UPS. (page 252)
Citing the research of Professor David Weil of Brandeis University, Sims concludes:
“Everything about Amazon’s decision to hire delivery companies that hire drivers, rather than hiring those drivers directly, is about driving down wages, removing workplace protections, evading to liability in the event of an accident, to avoid disputes in the workplace, to eliminate the cost of services and to eliminate the possibility for drivers to one day unionize…. “(Page 278)
In the last sentence of his book, Sims cites the 100 billion packages a year now shipped through the online retail supply chain, and he urges us to “imagine a future in which that number has doubled or tripled. ; imagine a future in which this is how virtually every finished object gets anywhere. (page 288)
Imagine: Jobs in factories in all sectors will have moved to countries with the lowest wages and adequate industrial capacity. Once-well-paid factory workers in Rust Belt towns will compete for minimum-wage Amazon warehouse jobs for as many months as their bodies can handle the ever-accelerating pace of simple repetitive tasks. Robots will have replaced human workers as much as possible. And the last mile delivery drivers will take orders from Amazon but receive their meager paychecks from other companies most of us will never see the names of.
In this paradise of capitalist productivity, who but Jeff Bezos will still have enough income to fill his shopping carts?
Image above: Your shopping cart is full, composed by Bart Hawkins Kreps from public domain graphics.