Amazon Is Running Out of Warehouse Workers. Cue the Robots

The recruiter thought the command seemed desperate but was painfully aware of how hard it had become to find people willing to work for Amazon. A conversation this person had with a prospective candidate at a job fair in Nevada typified the challenge. Upon learning the starting pay was $18.25 an hour, the man said he couldn’t afford to pay rent on that wage.

“He just walked off,” said the recruiter, who requested anonymity to speak freely about an internal matter. “It’s not exactly a dream job.”

Amazon, which churns through hourly workers at a brisk pace, has long expected to one day run out of warm bodies for its US fulfillment centers—an existential problem for an enterprise that made its name providing quick, reliable delivery. While the warehouses are partly automated, Amazon still relies on hundreds of thousands of people working in concert with the machines.

One answer to the labor shortage, of course, is more robots. But for years, engineers struggled to duplicate a human’s manual dexterity. Now Amazon appears to have solved the problem with a highly automated system featuring a yellow robotic arm that the company says can pick up millions of types of products without crushing or dropping them. The new bot’s name is Sparrow.

Amazon hasn’t said precisely how Sparrow and its machine cousins will revolutionize its operations. But patent filings, corporate blog posts and executive comments reveal a roadmap of the company’s ambitions (see diagram, below). Robots will stow and retrieve individual items, move packaged boxes into carts for shipment and pilot those carts to waiting trucks—labor now handled mostly by people.

The technology is still buggy, and full deployment will likely take years. But the automated system promises to fundamentally reshape Amazon, which has grown into the second-largest private US employer behind Walmart Inc., and in many towns is both the biggest employer and the default option for workers who have few marketable skills or were laid off from another job.

Automating more of the logistics operation also will require rethinking the simple, boxy warehouses Amazon has erected around the country. Bloomberg reported earlier this year that the company has quietly amassed thousands of acres of industrial real estate near key US cities; some of that land has been earmarked for a new generation of taller, more automated fulfillment centers that Amazon plans to develop itself.

Assuming the plan works, Amazon will probably staff warehouses with smaller more specialized teams largely made up of technicians. Sensitive to criticism that automation could eventually erase tens of thousands of jobs, the company insists it will free up workers for more stimulating tasks and help eliminate the hours of twisting and lifting currently required—no small matter for a company under regulatory scrutiny for high injury rates.

“In the 10 years since we’ve introduced robotics in our facilities, we’ve added hundreds of thousands of new jobs and created more than 700 new job categories that enable our technology,” Amazon spokesperson Xavier Van Chau said in an emailed statement. Amazon employees around the world work alongside robots and will continue to do so in the future, supporting safety in our workplace and helping us better deliver for our customers.”

In early November, Joe Quinlivan, a vice president who leads Amazon’s robotics and logistics technology teams, stood on a temporary stage in a suburban Boston factory. The 350,000-square-foot facility churns out the company’s current generation of warehouse robots and employs scores of engineers working on new technologies. “So this is the big unveil,” Quinlivan said as a video showed Sparrow picking items from a plastic tote and placing them in other bins.

He acknowledged it wasn’t the most exciting hype reel. “You would think that’s incremental, but it’s not,” Quinlivan said. He assured his audience that the robot was in fact “a major leap.”

Quinlivan came to Amazon in 2012, when the e-commerce giant acquired his employer, Kiva Systems Inc., one of a cluster of Boston-area robotics makers that also includes Boston Dynamics, creator of autonomous dog-like bots best known for viral videos of them climbing stairs or doing flips.

It’s hard to overstate the importance of Kiva to Amazon. Before the acquisition, the company's warehouses resembled densely packed libraries. Workers followed orders on printed tickets, pushing carts for miles each day through narrow aisles on their way to the books or CDs customers had ordered.

Kiva’s squat, self-driving bots reversed the entire process by bringing goods to waiting employees. Now merchandise would be stored on movable mesh shelving units that the robots could fetch and retrieve. The impact was profound. Doing away with the aisles let Amazon pack 40% more goods into its storage areas. And by eliminating long walks to products, the company cut by roughly a third an all-important internal metric called variable cost per unit (essentially labor hours divided by units shipped), according to three people familiar with the figure, who requested anonymity because Amazon hasn’t disclosed the data.

“Those were dollars” saved, said one of the people, a former Amazon technologist who was there when the Kiva robots were deployed. By contrast, this person said, all the other innovations since have amounted to “pennies.”

Now, thanks to Sparrow and a new automated storage system, Amazon may have found the next metaphorical dollar in savings.

Shortly after Quinlivan’s remarks, Jason Messinger, a roboticist who led development of the system, demonstrated Sparrow to a crowd of reporters. The tip of the bot’s arm features seven rubber-tipped, vacuum-powered suction devices that extend or retract depending on the size, shape and orientation of the product being grasped. Messinger says the secret sauce is the bot’s ability to recognize objects in a bin, the fruit of an extensive in-house effort to build software capable of identifying the millions of items offered on Amazon’s web marketplace.

“This is the result of years of innovation,” Messinger said, speaking into a microphone to be heard over the din of the machine’s hum, whirrs and sudden snap of air compressors as it grabbed and released an item.

Following programmed cues, Sparrow picked up items, one by one, and placed them in other totes. A toy cricket game. A DVD. A set of maps for anglers. It managed the tasks without mishap. The arm itself is built by an outside vendor, which Amazon declined to name. Company engineers integrated it with the “end-of-arm tool” and in-house computer vision software.

Amazon spent years testing technologies that might approximate human dexterity, at one point offering an annual cash prize to the builder of the best automated picker. An early version of a robot arm is on display in the lobby of the Seattle building that once housed Amazon’s top logistics executives—a prominent symbol of the company’s ambitions.

The work took on new urgency in 2016 after an internal analysis projected Amazon’s workforce—mostly warehouse staff—would top 1 million employees by 2021. The takeaway was that Amazon would exhaust the pool of willing workers and risk antagonizing unions. The prediction, which proved uncannily accurate, lit a fire under Amazon’s robotics and automation teams, turning their work into an imperative for former executive Dave Clark, who then ran the logistics unit, according to a person familiar with the situation.

The team was ordered to devise technology to enable two types of buildings: a highly automated fulfillment center and a fully automated one. The latter—known in the industry as a “dark warehouse”—ended up as more thought experiment than actual target, according to several people who worked on the project. Amazon often sets overly ambitious or unrealistic goals to inspire employees to think up creative solutions.

Advances in computer vision and robotic arms put the highly automated facility within reach, but there was a persistent stumbling block: the tightly packed mesh shelves that hold the millions of items in Amazon’s main fulfillment centers. Humans can easily spot a gap in these cubbies and wedge a bottle of Advil between a package of earbuds and a stuffed koala—a daunting task for a even cutting-edge robot. “You can’t just plug one of these things into the side of a shelf,” said Rob Hahn, a former Amazon warehouse manager who saw early prototypes.

In June, Amazon announced it had arrived at a solution, burying the breakthrough in a blog post about another robotic invention. The Containerized Storage System keeps products in deep plastic totes, leaving enough space for cameras to clearly see items and robotic arms to grab them.

The system was up and running last month at Amazon’s facility outside Boston, practicing on dummy inventory so engineers could work out the kinks. Hercules robots, workhorse successors to the original Kiva machines, ferried a towering rack of gray totes to a robotic arm tipped with two tote-shaped receptacles. The arm swung upward to position its basket in front of the correct rack, extended a suction device and grabbed a bin off the shelf. A split second later, the arm lowered and placed the bin atop a waiting bot, this one called Xanthus, a lightweight cousin to the Hercules.

What happens next wasn’t demonstrated, but an Amazon video of the process shows Xanthus delivering the bin to a waiting human worker. That’s a more ergonomically friendly process than the current system, which requires employees to repeatedly twist and stretch to reach shelves, risking injury to keep up with Amazon’s productivity goals. Ultimately, say outside roboticists who have seen the demo, the system could do away with these workers completely, with Sparrow placing and retrieving products from the shelves.

The generation of fulfillment centers being built now are designed to accommodate the new system, Quinlivan said in an interview. Amazon may retrofit older warehouses, too, a process they’ll assess site-by-site, as it may not make sense to retool modern facilities that can already ship as many as a million units a day. “There’ll be other sites where, you know, if we can’t get the labor, this will help,” he said.

Shelving and retrieving products—“stowing and picking” in company argot—are among the most common jobs in Amazon’s warehouses. “If they can figure out—when they figure out—the ability for the guts of the building to be containerized storage, it definitely will be cheaper” to operate, said Hahn, the former warehouse manager, who today works for Pattern Inc., an e-commerce firm. “Because they will need fewer people.” Someone familiar with Amazon’s plans simply described containerized storage as a “huge deal.”

Combined with other announcements in the last year—including robotic arms that autonomously sort packaged products and Proteus, a bot capable of safely ferrying loaded carts past humans—Amazon now has the necessary pieces for a highly automated warehouse.

The company says it’s early days for Sparrow and that it hasn’t finalized plans for how the machine will fit into warehouses. The arm is currently being tested at a single facility in the Dallas area, helping to more tightly pack inventory in Amazon’s shelves, a relatively marginal task. The bot can only handle 65% of the items Amazon stocks,  sometimes struggles to grasp loose or poorly packaged goods and is liable to pull a light bulb straight out of its packaging, said Messinger, the system’s design chief. Ash Sharma, who tracks warehouse automation at Interact Analysis, says the bot seems to have similar capabilities as state-of-the-art devices made by other companies and suspects deployment is “a couple of years down the line.”

Amazon’s roboticists insisted over and over that the goal is to help workers, not replace them. “We could not have done what we’ve done during the pandemic without the blend of people and machines,” said Tye Brady, Amazon Robotics’ chief technologist, a sunny optimist about the power of technology who says the company will always have human workers in its facilities. Brady’s goal is to eliminate heavy lifting  and stress injuries by automating that part of the process. “If I can take the repetitive motions out,” he added, “I can take the mundane out.”

Asked if Amazon was near the point where it would start employing fewer warehouses workers, robotics chief Quinlivan demurred, saying he was more concerned with finding enough people to help maintain and manage the growing fleet of machines. Amazon is training employees to fill some of those jobs. Career Choice, a program that pays for training and job certifications for hourly employees, had about 50,000 participants in its first decade. After Amazon expanded the program to include university degrees, it’s had almost 40,000 participants this year alone. A more focused Amazon program aims to train future robot operators and has churned out about 1,400 graduates in its first two years.

At the press event for Sparrow, some of those employees were on hand, flown in to serve as living proof that Amazon’s robotic future would include people. One was Kory Sellers, a 22-year-old manager from a warehouse in Charlotte, North Carolina. His crew recently retired their first Hercules robot, signing it as a “thank you” for helping keep the warehouse’s operation running. Standing in a corner of Amazon’s robotics factory, Sellers didn’t have much to say about the process playing out in front of him, but thanked his employer for the opportunity.

“Amazon robotics has helped me in my life and my career,” he said.

More stories like this are available on bloomberg.com

©2022 Bloomberg L.P.