Amazon will invest an additional $2.1 billion toward its Delivery Service Partner (DSP) programs in the form of safety initiatives, training, driver pay rate increases, value-added services and incentives. The company has invested a total of $12.3 billion since the DSP program, which subcontracts with third-party firms for the ecommerce platform’s expansive delivery needs, began in 2018.
“To help DSPs provide greater wages and benefits to drivers, we’ll invest an additional $660 million over the next year in DSP rate card increases and bonuses,” wrote Beryl Tomay, VP, Transportation at Amazon in a blog. “We anticipate that our investment will help DSPs increase driver pay to a national average of nearly $22 per hour, depending on their location, which is a 7% increase over last year. Many DSPs are already paying well above that, and our increased DSP rates will continue to support them in their efforts to recruit and retain high-performing teams.”
The various programs Amazon is instituting as part of this new investment, including these pay increases, won’t come to drivers from Amazon directly but rather are filtered through the individual delivery companies. These latest investments come after the National Labor Relations Board (NLRB) determined last month that Amazon was considered a “joint employer” of the third-party drivers that it contracts with in California.
Other programs launching as part of Amazon’s new investment include the addition of the PayActiv service, which DSPs can offer their drivers to provide them with access to up to 50% of their accrued wages before payday. The service also offers cash rewards, discounts, bill payment services and a savings tool within the app.
Advertisement
Amazon said it also is using AI and machine learning tools to help improve the driver experience, for example incorporating environmental factors like weather and walking distance into route planning systems to make it easier for drivers delivering during the hot summer months. Last year, Amazon adjusted routes so DSPs could give their drivers additional breaks to hydrate, rest and cool down.
Predictive models that identify potential safety risks on the road, along with technology within the delivery app to alert drivers to important safety cues such as unpaved roads or railroad crossings, are another key investment area. “We’ve trained our machine learning systems based on public safety datasets to help us construct safer routes,” wrote Tomay. “By the end of this year, we expect to identify risk characteristic for 200 million roads and provide 18 million safety cues for drivers.
