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Investing in the Italian economy
Since 2010, Amazon has made investments in our Italian operations of more than €12.6 billion. This includes both capital expenditure (such as the infrastructure we build, our logistics centres, corporate offices and cloud infrastructure), and operating expenditure (such as the salaries we pay to our employees in Italy).
In 2021 alone, we invested over €4 billion into the country as we looked to get closer to our customers and improve our services, but also continue to support the more than 20,000 small and medium-sized enterprises (SMEs) that sell on Amazon. Currently, almost 60% of the items sold on Amazon come from third-party sellers. Their success is our success and we will continue investing in tools, services and infrastructure so they can be more equipped to get through the current economic difficulties.
We also opened several new sites in 2021 and we currently have more than 60 facilities throughout Italy, including both operations and corporate offices. Amazon’s economic impact does not only benefit large urban areas, but also smaller towns in different regions with limited employment opportunities.
To support the digital transformation and recovery of the Italian economy, in 2020 Amazon Web Services (AWS) opened the AWS Europe (Milan) Region, enabling Italian SMEs, start-ups, large enterprises and government agencies to run their businesses, store data in Italy and serve end users with even lower latency. AWS will invest €2 billion by 2029 into our AWS Europe (Milan) Region, which will in turn contribute €3.7 billion to Italy’s GDP. Investments associated with our region are estimated to support an average of 1,155 full-time non-AWS jobs per year over the 2020-2029 period.
According to a new study* by The European House – Ambrosetti, analyzing large companies in Italy, Amazon is among the top five foreign private companies that invested the most in terms of capital expenditure in Italy in the period 2019-2021.
“We’ve invested heavily in the Italian economy and in our people, more that €12.6 billion since 2010, and we are employing more than 17,000 talented individuals who receive competitive pay and comprehensive benefits from day one. I’m particularly proud of how our investment on behalf of customers and Italian small businesses has contributed to Italy’s recovery and resilience, creating thousands of additional jobs through indirect effects and opening up new opportunities for colleagues, selling partners, service providers and suppliers.” Mariangela Marseglia, VP Country Manager, Amazon.it and Amazon.es
Creating jobs
Amazon’s local Italian-based workforce grew to reach more than 14,000 people at the end of 2021. We have already created 3,000 new permanent roles in 2022 for a total workforce in Italy of more than 17,000 permanent employees. According to The European House – Ambrosetti’s study*, Amazon took the lead position among private companies that created the most jobs in Italy in the period 2012-2021. Amazon ranked #5 in terms of total employment among foreign companies operating in Italy, and #27 among all Italian companies.
In 2021, Amazon paid an average of €35.8 million a month in wages and salaries to our Italian employees; a substantial increase compared to €24.5 million/month in 2020, due mainly to the rise in the number of our employees committed to supporting our customers during the pandemic.
Our state-of-the art facilities offer local employees a great and safe working environment, opportunities for professional development, competitive salaries, and rewarding benefits. Our people are what make this company great, and we reward them well. Amazon employs 5,000 people with permanent roles in the centre and south of Italy.
The vast majority of Amazon employees live in the communities that surround each site, and many of them grew up in those communities. Job opportunities with Amazon make a big difference for entire communities where there are limited options for many people to earn a living, offering careers within an advanced retail and technology business.
As of October, Amazon has raised entry level salaries for all warehouse employees, bringing wages up to €1,713 gross monthly pay. This represents a 19% increase above wages paid in 2018 and 8% above the 5th level of the national Transport and Logistics CBA plus extras; for example, discounts for purchases on Amazon.it, private healthcare insurance, and private medical assistance, which is a big leap up from most entry-level jobs. On top of the standard benefits, we offer a special education program which pre-pays 95% of tuition and associated fees for permanent employees to undertake nationally recognised courses, funding up to €8,000 over four years.
As we innovate to enrich the lives of our customers, we have created hundreds of different job roles in our teams across Italy. Whether in our corporate headquarters, research and development centres, delivery stations or fulfillment centres, Amazon has created all kinds of jobs for all kinds of people. We encompass an entire universe of roles across a wide range of business areas. From those starting work with fewer skills to people with doctorate-level qualifications, graduates and apprentices, to people with decades of experience, we have created roles across our business where people can develop their careers and positively impact the lives of our customers.
Amazon’s global Leadership Principles include an ambition to become “Earth’s best employer”. It’s an ambition we take very seriously, and it informs every aspect of how we engage with and support the people who work for us. In 2021 and 2022, we received in Italy the Top Employer certification in recognition of our diverse and inclusive work environment, our professional development opportunities, and the training programs we are offering to employees.
According to a recent Keystone Strategy study, through indirect effects of our investments, more than 48,000 new jobs were created in 2021; for example, in construction, logistics and services. Total indirect jobs reached the record number of 108,000, adding the 60,000 jobs created by Italian small and medium-sized businesses using Amazon’s services to grow their enterprises and export Italian products around the world.
Enabling Italian SMEs to succeed on Amazon
In addition to investing in our communities and creating jobs, we also invest in tools and support for a large number of businesses across the country who use our technology and services to grow their businesses through increased sales within and beyond Italy, and to protect their brands. In 2021, there were more than 20,000 Italian SMEs selling on our stores (from 18,000 in 2020). About half of these exported their goods all over the world, reaching more than €800 million in international sales. Over 200 Italian SMEs selling on Amazon surpassed €1 million in sales for the first time in 2021. In addition, those selling partners have created more than 60,000 jobs so far.
To further reinforce our commitment to help sales, last May we announced our pledge to support Italian SMEs selling on Amazon to reach €1.2 billion annual export sales by 2025 – almost doubling the 2020 export value – in a move that will contribute to the objectives of the Italian National Recovery and Resilience Plan (NRRP), while offering a wider availability of Italian original products to customers all over the world.
Discover more about how we support Italian SMEs through the Made in Italy showcase and Accelera con Amazon, our free training program designed with the collaboration of ITA, Netcomm and Politecnico di Milano, to boost the growth and the digitization of small businesses across Italy. We have also signed agreements with the regions of Liguria, Sicily, Marche, Abruzzo and Umbria to bring our support to local businesses; collaboration with the regions is essential to achieving this goal.
“We, as many other companies, are impacted by the current macroeconomic challenges resulting in higher operating and energy costs. Having a long-term approach means focusing our efforts on the support to our employees, on our customers – offering them the widest selection and keeping prices low in a high inflation environment – and on the country’s priorities: sustainability, digitalization, employment, education.” Mariangela Marseglia, VP Country Manager, Amazon.it and Amazon.es
Progressing our path to net zero carbon by 2040
At Amazon, we have decided to use our size and scale to make a difference for the planet. Amazon is the first signatory of The Climate Pledge, which was launched with the NGO Global Optimism in 2019. That means we are committed to becoming net zero carbon across our entire global business by 2040—a decade ahead of the Paris Agreement’s goal. We are working towards this goal by taking immediate action to decarbonise across our business operations: be it energy usage, transportation or packaging. Amazon is investing in wind and solar to reach 100% renewable energy across our global operations by 2025. According to our 2021 Sustainability Report, we achieved 85% renewable energy across our operations, up from 65% in 2020. And our progress to decarbonise our operations reflects in our carbon intensity, which decreased 1.9%.
In Italy, we announced the first two solar off-site projects in Sicily: the two agro-photovoltaic plants are innovative projects combining clean energy and agricultural crops, and with a third upcoming offsite solar project, the total production capacity in Italy will reach 106MW. In addition to that, 17 sites in Italy are also provided with onsite solar systems on their rooftops and each onsite solar installation can generate as much as 80% of a single fulfillment centre’s annual energy need. In 2021, Amazon shipped more than 7 million packages to Italian customers using zero emission vehicles. In 2022, we committed to investing more than €1 billion over the next five years to further electrify and decarbonise our transportation network across Europe. In 2022, we also stopped using air pillow plastic bags and single-use plastic bags for products shipped via our own logistics network in Italy.
Moreover, as part of our Right Now Climate Fund, we are investing in nature-based projects to improve environmental conditions in the communities where we operate across Europe: in Italy, we are supporting Parco Italia, an urban forestry program that aims to plant 22 million trees – one tree per city resident – across 14 metropolitan areas as part of a reforestation and research program supported by the Italian Society of Silviculture and Forest Ecology, the Fondazione AlberItalia and Stefano Boeri Architetti. The Parco Italia program will receive €2 million to support the strategic planning of the program and initial tree planting. The project will also help cities to become more climate change-resilient, increasing urban biodiversity, improving air quality, and promoting urban cooling.
Supporting local communities in Italy
Amazon is committed to supporting communities where our employees live and work. The year 2021 was a challenging year for many of these communities across the country, following the socioeconomic crisis caused by the pandemic. With the objective to act as a responsible citizen, along with investing in the safety of our employees and supporting our customers, we worked with over 100 Italian NGOs and universities, and supported them with over €5.7 million. Moreover, we continued to support schools with the “Un click per la Scuola” program, which, since its launch in 2019, allowed us to sustain more than 28,000 Italian primary and secondary schools with €5.9 million euros in virtual credits. In addition to that, in 2021 Amazon’s global Right Now Climate Fund donated €2 million to kick off the Parco Italia reforestation project.
Total tax contribution in Italy As we continue to hire, invest and grow in Italy, we contribute our share to fund public services and infrastructure throughout the country. We do this through the taxes that are collected by the government as a consequence of our activities in Italy. Those taxes fall into two categories:
- Directly incurred taxes: the taxes that are directly incurred and payable by Amazon, including Corporation Tax (Ires and IRAP), taxes paid for land acquisition or construction (Property Tax, Registration Tax), payroll taxes, and social security paid by employers, import duties and DST.
- Indirect taxes collected and submitted: the taxes we collect and submit from our customers, employees, and other third parties because of our business activities in Italy. These include VAT and the taxes paid by our employees.
It’s important to understand both of those categories, because focusing narrowly on one aspect of taxation, such as Corporation Tax, doesn’t tell the whole story: Corporation Tax, according to recent research conducted by the OECD, accounts for only around 5% of total tax revenues from Italian taxpayers.
Amazon is a growing business with a high volume of sales, but, as is the case for retail businesses, operating profits remain relatively low due to price pressure in a very competitive market, intense capital investment, and increasing operating costs (including those from a growing workforce and inflation).
Over the past two years, we have seen increases in our operating costs as we doubled the size of our global fulfillment network which we had built over Amazon’s first 25 years. In Italy, this meant we invested more than €609 million in infrastructure in 2021 as we opened two new fulfillment centres in Novara and Cividate al Piano (Bergamo) as well as a new sortation centre in Spilamberto (Modena), and many delivery stations across the country, with two of these fulfillment centres fitted out with our latest robotics technology. We also continued to invest in the AWS Europe (Milan) Region in order to meet the growing needs of our customers and to help strengthen Italy’s digital infrastructure. Many of these sites are in parts of the country with a history of higher unemployment and lower investment, which is just one of the ways Amazon is contributing to the Italy’s PNRR goals.
Italy is a centre of talent and opportunity, and we’re pleased to play a role in fostering that and supporting growth by continuing to invent for our customers.
* The European House – Ambrosetti released a study on the employment generated by large Italian and foreign companies operating in Italy over a 10-year timespan (2012-2021) updating the same study published in 2021 (for the period 2011-2020). As a new area of research, the 2022 study also analyses the total amount of investments in Italy, in terms of capital expenditure (CAPEX), by large foreign companies operating in Italy over the last three years (2019-2021). The study is based on AIDA (Bureau van Dijk S.p.A.) database, containing the balance sheets of all active and failed companies. The latest available data on employment, turnover and investments are for 2021.
To ensure homogeneity and comparability of data, the analysis considered all companies (with financial statements filed in Italy) that in 2021 fell into the cluster with more than 250 employees and €50 million turnover. As of November 4, 2022, the share of firms that have filed 2021 financial statements in AIDA as compared to the total sample of firms with more than 250 employees and €50 million in revenue is about 70%.
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