Amazon Raises Minimum Wage to $20 an Hour and Expands Benefits 2026

Amazon has raised its minimum wage in the US to $20 an hour, with average pay at the company reaching $24 an hour, according to the company. The pay increase represents a $1 increase from its starting level and brings Amazon’s minimum pay in line with Costco, which raised its lowest starting pay to $20 an hour in 2025.

Amazon’s Wage Increase and New Benefits

The wage hike, announced in a blog post by Udit Madan, senior vice-president of worldwide operations at Amazon, is part of the company’s efforts to attract and retain talent in a competitive labor market. “We talk a lot about continuous improvement at Amazon—about always wanting to get better, even when things are going well,” Madan wrote. “I’m excited about how these investments work together to help our employees and their families continue to thrive for the long run.”

In addition to higher pay, Amazon is expanding employee benefits to include grocery discounts. Employees will receive an uncapped 10% off eligible fresh groceries and everyday essentials on Amazon.com and Whole Foods Market Online, plus 20% off in-store at Whole Foods Market. This move is designed to support employees’ well-being and financial health.

How Amazon’s Pay Compares to Competitors

Amazon’s new minimum wage of $20 an hour puts it on par with Costco, which also raised its starting pay to $20 an hour in 2025, with most workers earning more than $30 an hour. Both retailers now offer starting pay significantly higher than other major competitors. Target’s starting wage remains at $15 an hour, while Walmart’s starts at $14 an hour.

The following table summarizes the starting wages at major US retailers:

Amazon’s pay raise also highlights the growing pressure on retailers to offer competitive compensation amid rising living costs and labor shortages. With about 1.1 million employees in the US, Amazon is the second-largest private employer behind Walmart. The company also cited the creation of 390,000 Amazon delivery service provider jobs, which are operated by contractors.

Key Takeaways for Workers and Job Seekers

• Higher starting pay: Amazon’s minimum wage is now $20 an hour, with average pay at $24 an hour.
• Expanded benefits: Employees get 10% off groceries on Amazon and Whole Foods online, and 20% off in-store at Whole Foods.
• Competitive landscape: Amazon matches Costco’s starting pay but exceeds Target and Walmart.
• Job creation: Amazon has facilitated 390,000 delivery service provider jobs through contractors.

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