Over the past 26 years, Amazon has grown from a small startup to the second-largest private employer in the U.S. We’ve worked throughout that time to maintain our startup mentality. It fuels our drive to innovate and to make high-impact investments to keep our employees safe, serve our customers, and benefit the communities where we operate. As we turn the page on one of the most challenging years in U.S. history, we want to share a snapshot of the investments in innovation, community investments, job creation activities, and tax contributions we made in 2020.
Investments in the U.S. economy
We continue to invest heavily in our U.S. operations, with more than $350 billion in direct investments since 2010. This includes investments in corporate offices, customer fulfillment and cloud infrastructure, wind and solar farms, eco-friendly equipment and machinery, and compensation to our employees. We also invest in the development of new technology at our Puget Sound and Arlington headquarters and our 16 tech hubs across the U.S. These investments create a ripple effect throughout the economy as the businesses that supply goods and services to Amazon expand and household spending increases. Our investments over the last decade have contributed an additional $315 billion to the U.S. GDP and have led to the creation of more than 2.7 million jobs across the country, according to research by Keystone. We also support more than 780,000 indirect jobs—in construction, professional services, healthcare, and other industries—that help communities nationwide thrive.
On top of that, we are supporting the rapid growth of more than 1.7 million small and medium-sized businesses (SMBs) around the world that are selling their products in our store. SMBs now makeup close to 60% of the sales in our store, and they have created more than 2.2 million jobs globally as a result of selling on Amazon. In fact, SMBs from all 50 states that sell with Amazon are more than twice as likely to see 25-50% hiring growth compared to those that do not, according to research by IDC.
Protecting employees worldwide while delivering for customers
At the start of 2020, the COVID-19 pandemic descended upon the U.S. Since the early days of the outbreak, we’ve worked non-stop to make 150 changes to our operational processes and to procure the necessary supplies to protect the health of our employees. Whether it's packing orders in one of our fulfillment centers or delivering products to a customer's doorstep, our employees have played a critical role in blunting the impact of the virus by enabling people to stay safe at home while receiving the products they need.
Our more than $11.5 billion investment in COVID-related initiatives in 2020 included more than $961 million on safety measures such as temperature checks, masks, gloves, and enhanced cleaning and sanitization. We invested hundreds of millions of dollars in testing and hired dozens of lab technicians and others to build a world-class laboratory team. We launched voluntary on-site testing at hundreds of sites globally and are conducting tens of thousands of tests a day to keep our front-line employees safe. Amazon’s dedicated COVID-19 labs have processed more than 1 million tests globally. We provide testing to employees at no cost. And because we use our own labs, we are adding testing capacity to the overall pool. We are also working at the federal and state levels to support the vaccinations of front-line employees and those in the community who are providing essential services throughout the pandemic, including enabling pop-up clinics in Washington state and Florida, with more on the way.
At the end of 2020, we shared our appreciation for our front-line employees by providing a special recognition bonus totaling more than $500 million. Combined with other holiday pay incentives, we invested—in the last quarter alone—more than $750 million in additional pay for our front-line hourly workforce. All together, we provided over $2.5 billion in bonuses and incentives for our employees globally in 2020.
Creating good jobs with great benefits and training
In 2020, Amazon helped get people back to work by hiring more than 400,000 new employees whose jobs in industries like hospitality, restaurants, and travel were lost or furloughed because of the pandemic. We invited out-of-work people to join us at Amazon until things return to normal and their former employers are able to bring them back.
We now have close to 1 million employees across more than 40 states and 250 counties, and our teams are continuing to grow. In the U.S., we pay employees a starting wage of at least $15 an hour, and our full-time employees receive comprehensive benefits like healthcare, 401(k) company matching, and up to 20 weeks of paid parental leave. In some locations, we provide our employees with access to dedicated health clinics that were built to serve them and their families exclusively. From the first day on the job, these industry-leading benefits are extended to full-time employees equally, regardless of their role and whether they work in our fulfilment centers or in corporate offices. In addition, Amazon employees can access a wide range of free training programs to learn new skills for in-demand jobs as part of Upskilling 2025, a $700 million commitment to help employees gain critical knowledge so they can move into higher-skilled, better-paying roles. We recently announced plans to extend these programs beyond our employees and will offer free skills training in cloud computing to 29 million people around the world to get them ready for jobs in one of the fastest-growing industries.
Due in part to these career advancement programs, benefits, and pay, we were recognized by LinkedIn as a top company to work for and selected as the world's second-best employer by Forbes, based on feedback directly from our employees.
Our U.S. tax contributions
While we continue to invest heavily and aggressively to create good jobs, Amazon also plays a key role in helping fund public services and infrastructure throughout the country. We do this through the taxes we pay and the taxes we collect and remit on behalf of our customers, employees, and third-party sellers. The taxes we pay include federal and state income taxes, payroll taxes, sales and use taxes, property taxes, gross receipts taxes, and customs duties. We collect and remit sales taxes across our marketplaces as well as payroll taxes on behalf of employees. By collecting and remitting taxes on behalf of our customers and sellers, we help reduce compliance costs and ensure that state and local governments receive revenues on a timely basis.
Our U.S. federal taxes are a reflection of our continued investments, how we compensate our employees, and current U.S. tax law. Like most governments that seek to encourage economic investment by companies, the U.S. Congress has written a tax code that incentivizes job creation, capital investment, the development of new technology, and employee ownership—all of which are priorities for Amazon and critical drivers of a prosperous economy.
Amazon's 2020 tax contributions include:
- About $1.7 billion in federal income tax expense.
- $1.8 billion in other federal taxes, including payroll taxes and customs duties.
- More than $2.6 billion in state and local taxes, including payroll taxes, property taxes, state income taxes, and gross receipts taxes.
- Last year alone, Amazon collected nearly $18 billion in sales taxes on behalf of states and localities throughout the U.S. The continued enactment of "marketplace laws," now in 42 states, allows Amazon to legally collect sales taxes on behalf of third-party sellers in the U.S., reducing the compliance burden for both sellers and tax authorities.
Supporting our communities
Amazon is committed to supporting communities that we are proud to call home. Throughout 2020, we donated millions of dollars in cash and in-kind contributions to organizations fighting the COVID-19 pandemic in the U.S. This included $10 million in critically needed personal protective equipment, including 4.4 million masks, 273,000 gallons of hand sanitizer, thousands of contactless thermometers, and logistical support to food banks and clinics. We also collaborated with food banks and schools to deliver more than 12 million meals to vulnerable seniors and families in more than 25 U.S. cities; In addition, we delivered more than $5 million worth of Amazon devices to nonprofits and healthcare organizations on the front lines of the virus; and donated more than $20 million to help accelerate COVID-19 research.
We continued to grow Amazon Future Engineer, our comprehensive childhood-to-career program designed to inspire, educate, and prepare children and young adults from underrepresented and underserved communities to pursue computer science. This program now benefits more than 550,000 K-12 students from underserved communities across 5,000 schools. We expanded our Right Now Needs Fund with $3.5 million in donations to nonprofits that are helping to remove barriers to learning for students in the Puget Sound region and Northern Virginia. We donated more than 1 million emergency aid items to community partners providing disaster relief to people affected by wildfires in California, Oregon, and Washington state, as well as those impacted by Hurricane Laura along the Gulf Coast. We also provided more than $100 million in cash and in-kind donations to our partners at Mary's Place to open a first-of-its-kind family shelter inside our Seattle headquarters, supporting more than 200 people fighting homelessness each night.
Amazon also recently launched a Housing Equity Fund—a $2 billion commitment to preserve existing housing and to create inclusive housing developments through below-market loans and grants to housing partners, traditional and non-traditional public agencies, and minority-led organizations. The fund will support Amazon's commitment to affordable housing and will help ensure moderate- to low-income families can afford housing in communities with easy access to neighborhood services, amenities, and jobs.
We continue to make progress in meeting The Climate Pledge, a commitment co-founded by Amazon and Global Optimism, to be net-zero carbon by 2040—a decade ahead of the Paris Agreement's goal of 2050. To date, we have had 31 other companies join us, including Unilever, Uber, Verizon, Microsoft, JetBlue, and Best Buy. We recently became the world's largest corporate buyer of renewable energy. We launched a $2 billion Climate Pledge Fund to support the development of sustainable and decarbonizing technologies that help to decarbonize the economy and protect the planet. We also launched a $100 million Right Now Climate Fund to support nature-based climate solutions. We ordered 100,000 electric delivery vehicles, the largest order ever of electric delivery vehicles. Amazon Web Services is helping other enterprises mitigate their environmental impact by providing technology infrastructure that is 3.6 times more energy efficient than many major companies' data operations.
We're pleased to play a role in creating opportunity and driving prosperity across the country. We're excited for the potential that 2021 offers and will continue to invest, invent, create jobs, and work to enhance communities nationwide.