How Amazon Worker Exploitation Looks In Small-Town Italy
In the Italian province of Rovigo, Amazon’s arrival appeared to be an opportunity to revive the area's economy and create jobs. But two and a half years later, it's clear that the giant has had a negative impact on the struggling area.
CASTELGUGLIELMO — When he works the morning shift, Matteo Tacconi* is out of bed by 5 a.m.. He grabs a coffee, jumps into his old car and travels 30 kilometers from his rented home to the Amazon plant in this small tow in the northern Italian province of Rovigo.
At 52, he has only been able to find two types of work in the southern city where he was born: "Agriculture, or black market agriculture." Both are precarious, poorly paid jobs, and so after an interview with an agency that provides temporary workers for Amazon, he didn't think twice, and moved north with his family to accept a three-month job. “The hope was that after a few more temporary contracts, they would eventually decide to hire me," he says.
As Tacconi reaches the factory in the morning, thousands of other Amazon workers are traveling from their homes in Polesine and other neighboring provinces to reach Castelguglielmo, where one of Amazon’s largest distribution centers has been built in an area surrounded by soybean and beetroot fields.
Like other such Amazon warehouses, it is located in an area plagued by high unemployment rates and issues with infrastructure and services. In many cases, the towns in the area are just a handful of houses gathered around the town hall and the bell tower, with few job opportunities and lots of emigration.
With an unemployment rate almost double that of the rest of the northeastern Veneto region and mediocre standards of living, the towns of the region saw Amazon’s arrival in fall 2020 as an opportunity to make changes. E-commerce was booming due to the pandemic, and so was Amazon’s business.
An exploitable area
Enrico Ferrarese, president of the province of Rovigo, summarizes the prevailing mood at the time: “The arrival of Amazon appeared as an opportunity to revive the economy of the area and give work to our unemployed. We certainly didn't expect a huge change in the situation, but an important change, yes.”
Two and a half years later, it is clear that the impact of the site is not solely positive.
Two and a half years later, it is clear that the impact of the site is not solely positive. Employment has increased, and Amazon alone has created 1,500 permanent jobs, becoming the number one private employer in the province of Rovigo. But the other side of the coin is the high number of temporary workers, who for a long time exceeded the number of workers with a stable contract.
These temporary contracts were renewed for three months at a time, affecting a fifth of the precarious workers, which created a pattern of using workers in low-skilled jobs with a continuous turnover. Research from the Veneto Institute of Economic and Social Research (IRES) and the University of Padua, which conducted the first comprehensive research on a plant of this type, illustrates the problem. In Dec. 2021, just over a year after Amazon opened in the town, only 37% of the workers initially employed continued to work in the plant, while a majority had been replaced.
For Francesco Melis, national coordinator for Amazon precarious workers with the NIdiL Cgil trade union, the situation is similar elswhere in Italy: “Precariousness is structural, and the turnover is so high that it soon runs out a pool of workers in the area and triggers a massive migratory phenomenon from other provinces and regions,” he says.
Another negative consequence was the 30% increase in rental prices and the newfound difficulty in finding affordable housing throughout Rovigo. In San Bellino, a single room can cost up to €400. The increase in prices also extended to the neighboring areas: in Rovigo, the local administration tried to calm protests of students who were competing for housing with the workers moving into the area. As a result of these changes in living expenses, Tacconi decided to look for accommodation 30 kilometers away, which was the only way he could have a roof for himself and his family.
The Castelguglielmo facility.
From Amazon’s point of view, investing in these areas means offering a concrete development opportunity, creating not only employment but "good employment." The starting salary of a warehouse operator, the company claims, is higher than the minimum wages established by the logistics contract, and also boasts added benefits such as health insurance and meal vouchers.
The union's accusation, however, is that the company has a precise strategy: make the most of the army of "disadvantaged" workers present in the area as a precarious and interchangeable workforce to cope with the variability of orders.
There are legal limits on the use of temporary contracts, which can only constitute a maximum of 30 percent of a company's employees. But the same law recognizes some exceptions. Some categories include those unemployed for more than six months, women, people under 24, unemployed people 49 years or older and migrants in the process of job placement, who are all not counted in the 30 percent. The use of these categories gives the company considerable flexibility, especially in the three years following its settlement in the area.
At the Rovigo plant in Feb. 2021, five months after its opening, temporary workers accounted for 84% of employees. A year later, they were 53%. Today, precarious employment has significantly decreased, but is still widely used to manage peaks and can represent a third of the total workforce.
For its part, the company claims to have a robust recruitment campaign that has led to a doubling of employees and a halving of temporary workers already in the first year of the plant's life.
A complex supply chain
The fulfilmment center is the center of Castelguglielmo. A distribution center for small items such as books, toys and household items, it can employ up to 1,500 people, whose job it is is to receive goods from suppliers, place them on shelves and fulfill orders by retrieving stored items using a digital scanner. Employees pack the parcels while other employees apply the shipping label. From there, parcels are loaded onto delivery trucks.
The sound of the belts that transport the goods to the loading and unloading areas is the permanent soundtrack of these highly automated centers, "Where the work can be very repetitive and, in some departments, very wearisome," says employee Ludovico Sorba*.
However, unlike the old Castel San Giovanni plant, where work is still done with forklifts, downtime is reduced in Castelguglielmo with the use of robotics and the introduction of mobile shelves in warehouses. Connected to orders in real-time, the shelves transport the products to the operator workstations. The plant works in a continuous cycle over three shifts with half-hour intervals, seven days a week.
The sorting centers, introduced by Amazon in 2014, which are smaller than the distribution centers and only have a few hundred employees, sort packages according to the final destination. There are also delivery stations, which are smaller centers that represent the last mile of Amazon's distribution system. There, parcels received from the larger warehouses are entrusted to drivers, usually contractors with external companies, for delivery.
There are 10 first-entry centers like Castelguglielmo throughout Italy, which are surrounded by about 30 sorting centers.
The location of the warehouses appears, above all, to be linked to logistical considerations. While the delivery stations are close to the final customers, close to large urban areas and the richest ones, proximity to major road infrastructures and airport hubs is crucial for almost all plants.
The Castelguglielmo Amazon site, in addition to being located on the Transpolesana road, is a few kilometers from the Valdastico (A31), a highway that crosses Rovigo from south to north and connects it to Padua and Vicenza, and from the A13, which connects Padua to the airport in Bologna.
For Matteo Poretti, transportation secretary of the CGIL of Rovigo, the size of the plants also counts: "A plant of 60,000 square meters is difficult to connect with the infrastructures of a freight village like the one in Padua, and the value of the land is cheaper in San Nice than in Segrate.”
On the other hand, the strategy followed means that Amazon's distribution and sorting centers end up being located “in areas inhabited by low-income social groups and therefore more ‘hungry’ for work,” notes Marco Veruggio of the Punto Critical publishing project.
To validate this hypothesis, the group of researchers tried to draw, starting in March 2022, a map of the Amazon settlements present in Italy, crossing the type of plants with the average taxable income and the employment rates of the areas concerned. The finding is significant: the average income in the settlement areas of the distribution and sorting centers is between €14,000 and €20,000 euros, with peaks of €21-22,000 euros in the north and generally low employment rates.
They are located where incomes are lower and unemployment is higher.
In Rovigo, for example, in 2020 the overall employment rate was 45 percent (the female employment rate was at 34 percent) with an average annual taxable income of just €15,000. By comparison, a large city like Rome has an average income of almost €25,000. “But even when the warehouses are in relatively affluent metropolitan areas, such as in the capital, they are located where incomes are lower and unemployment is higher,” Veruggio says.
The Amazon trucks outside the Castelguglielmo facility in the province of Rovigo, Italy.
A need for work
Towns like Castelguglielmo need flexible labour. Amazon's "production system" is apparently similar to that of Ford, with strong automation and a rigid division of labour, but in reality, based on the principle of lean production where variations in the volume of orders are in control.
To deal with the peak of Black Friday (the day on which Christmas discounts and sales begin) and that of Prime Day (the annual discounts for Amazon Prime customers), the American company hires a large number of precarious contracted workers. “The number is much higher in the new factories, where the percentage of temporary contracts can even exceed 70 percent, while in the historical ones of Piacenza or Passo Corese the ratio between permanent workers and those under precarious contracts tends to stabilize. But even here the precarious workers are a lung that expands and contracts, according to the peaks, and which can even reach 40 percent of the staff,” says Melis.
For the trade unionist, who recognizes the significant presence of stable workers, the constant traits in all the plants are precariousness and an unusually high turnover rate, which can be explained in two ways, he says: “The extremely high work rates which deplete and lower the performance of the worker; the nature of temporary contracts, renewable for a maximum of twelve months, after which the company must justify the temporary nature of the contract with a reason. In both cases, the multinational prefers to replace the workers. Hence the need for the company to increasingly expand the personnel recruitment area.”
Here in Rovigo we don't have thinking heads or engineers, but only warehouse workers. This is no development.
The data collected by Ires Veneto and the University of Padua seem to confirm this hypothesis. “Although the province of Rovigo has both male and female employment rates lower than the Veneto average and much higher unemployment rates, just 42% of those employed are local, while six out of 10 come from other Veneto provinces or from outside the region,” explains Chiara Gargiulo, of Ires Veneto. “For a job that in seven out of 10 cases is a warehouse worker, just 4% are hired with an intellectual professional qualification.”
For the director of Confindustria, Paolo Armenio, the rhetoric of good employment crashes against the numbers: “Here in Rovigo we don't have thinking heads or engineers, but only warehouse workers. This is no development.”
Amazon replies to these accusations by citing a Nomisma study which states that since the opening of the plant there have been positive effects on the commercial activities of the area and on the manufacturing companies that serve the plant, driven to adopt more efficient production systems.
Despite this, in the perception of most of the local institutions and category representatives, Amazon and the local region remain far apart. If Amazon on the one hand says it is ready for dialogue, most of the territorial subjects claim that they are not aware of the company's development strategy, nor have they ever been involved in projects in which Amazon is the leader.
A giant in the region
In the specific case of the Castelguglielmo plant, these problems are linked to those of the area. “Amazon, in deciding to open in Rovigo, encounters an unprepared institutional and economic fabric,” observes the secretary of the chamber of labour, Pieralberto Colombo. “Castelguglielmo has 1,300 inhabitants; San Bellino has just over 900, and so do most of the municipalities in the area, while Amazon is a giant that employs almost 3,000 workers here alone. We need greater involvement in managing the consequences that a plant of this size brings with it.”
No one has bothered to figure out how to develop a local transport service.
There is not adequate space for the capacity of the vehicles entering and leaving the plant, for example, which raises a second challenge: “No one has bothered to figure out how to develop a local transport service that can bring people to work from the main neighboring cities to a plant built in the middle of the fields. A thousand people on the move is no small thing for a territory like that,” underlines Poretti.
The third problem is the housing shortage. The municipalities in the area, the ones from which one can realistically think of reaching the plant, are small, and "especially at the beginning,” says Sorba, “it was practically impossible to find an available apartment at affordable prices.”
With a three-month employment contract, it was difficult to provide the necessary credentials to secure a lease. Therefore, makeshift bed-and-breakfasts and other more flexible solutions have multiplied.
When Amazon arrived, the case of Massimo Straccini, 58, caused a sensation. He had been forced to live in a camper with his wife outside the factory in order to work. When his first contract expired, Amazon decided not to renew it.
Since then, some administrations have tried to equip themselves. Rovigo is focusing more on social housing and local welfare projects. But there are still no forms of territorial coordination, and it is difficult to ask the small municipalities of Medio Polesine to do the same.
The fourth problem is that of the working conditions in the plant. If, at a national level, the unions believed Amazon might be open to discussing contractual forms that guarantee greater employment continuity, Poretti says that “Amazon's opposition remains to open local bargaining tables, in which to discuss the application of the contract and flexibility, which we know is the heart of their system.”
*Names have been changed to protect identities
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