NYT profiles Apple's retail stores, says employees are 'short on pay'
As part of its "iEconomy" stories profiling Apple, The New York Times has taken a closer look at the company's retail stores, stating that retail employees have "enjoyed little" of the company's great financial success.
Noting that about 30,000 of Apple's 43,000 employees in the U.S. work at the company's retail stores, the story published this weekend said many of Apple's retail workers earn about $25,000 per year, which it said is "average pay" according to "the standards of retailing." Apple's pay is well above the minimum wage of $7.25 that the Gap offers, but is also slightly less than yoga and athletic apparel chain Lululemon.
"But Apple is not selling polo shirts or yoga paints," author David Segal wrote. "Divide revenue by total number of employees and you find that last year, each Apple store employee —?that includes non-sales staff like technicians and people stocking shelves — brought in $473,000."
Apple's per-employee sales are well beyond the average of $206,000 seen by other electronics and appliance stores. And yet people still want to work for Apple and the company has no shortage of applicants for retail jobs, as mostly young "true believers" are given a sense of working for the "greater good," as one anonymous former salesman told the Times.
The story includes comments from MacRumors reporter and ex-Apple retail store employee Jordan Golson, who said it was "tough" when he sold three-quarters of a million dollars worth of devices in a three-month span, but was earning just $11.25 per hour. He noted that in Christmas 2010, he and other employees were given gifts of a fleece blanket and insulated coffee thermos.
The report comes soon after Apple began informing some of its retail employees last week that they would be receiving significant pay raises of up to 25 percent. A recent internal review conducted by Apple reportedly found that pay was a major concern among employees, particularly as sales staff earn between $9 and $15 per hour, while Geniuses tend to make around $30 per hour.
Apple Store staff at the company Grand Central Terminal location in New York. | Source: Apple
Apple's new retail chief John Browett, who took residence at the Cupertino, Calif. company two months ago after leaving his position as CEO of UK electronics chain Dixons Retail PLC, is thought to be behind the alleged wage increases. In a video to Apple retail employees in shortly after his hire, Browett promised to push up employee performance reviews from the original September schedule.
Previous installments in the Times "iEconomy" series accused Apple of sidestepping taxes, and also profiled the "human costs" of assembly of Apple's devices in China. The series has included anonymous comments from former Apple executives who claimed that the company has known about "labor abuses" in supplier factories for years without requiring that they be addressed.
That story prompted Apple Chief Executive Tim Cook to lash out in an e-mail to employees, in which he said "any suggestion that we don't care is patently false and offensive."
"We will continue to dig deeper, and we will undoubtedly find more issues," Cook wrote. "What we will not do — and never have done — is stand still or turn a blind eye to problems in our supply chain. On this you have my word."
Noting that about 30,000 of Apple's 43,000 employees in the U.S. work at the company's retail stores, the story published this weekend said many of Apple's retail workers earn about $25,000 per year, which it said is "average pay" according to "the standards of retailing." Apple's pay is well above the minimum wage of $7.25 that the Gap offers, but is also slightly less than yoga and athletic apparel chain Lululemon.
"But Apple is not selling polo shirts or yoga paints," author David Segal wrote. "Divide revenue by total number of employees and you find that last year, each Apple store employee —?that includes non-sales staff like technicians and people stocking shelves — brought in $473,000."
Apple's per-employee sales are well beyond the average of $206,000 seen by other electronics and appliance stores. And yet people still want to work for Apple and the company has no shortage of applicants for retail jobs, as mostly young "true believers" are given a sense of working for the "greater good," as one anonymous former salesman told the Times.
The story includes comments from MacRumors reporter and ex-Apple retail store employee Jordan Golson, who said it was "tough" when he sold three-quarters of a million dollars worth of devices in a three-month span, but was earning just $11.25 per hour. He noted that in Christmas 2010, he and other employees were given gifts of a fleece blanket and insulated coffee thermos.
The report comes soon after Apple began informing some of its retail employees last week that they would be receiving significant pay raises of up to 25 percent. A recent internal review conducted by Apple reportedly found that pay was a major concern among employees, particularly as sales staff earn between $9 and $15 per hour, while Geniuses tend to make around $30 per hour.
Apple Store staff at the company Grand Central Terminal location in New York. | Source: Apple
Apple's new retail chief John Browett, who took residence at the Cupertino, Calif. company two months ago after leaving his position as CEO of UK electronics chain Dixons Retail PLC, is thought to be behind the alleged wage increases. In a video to Apple retail employees in shortly after his hire, Browett promised to push up employee performance reviews from the original September schedule.
Previous installments in the Times "iEconomy" series accused Apple of sidestepping taxes, and also profiled the "human costs" of assembly of Apple's devices in China. The series has included anonymous comments from former Apple executives who claimed that the company has known about "labor abuses" in supplier factories for years without requiring that they be addressed.
That story prompted Apple Chief Executive Tim Cook to lash out in an e-mail to employees, in which he said "any suggestion that we don't care is patently false and offensive."
"We will continue to dig deeper, and we will undoubtedly find more issues," Cook wrote. "What we will not do — and never have done — is stand still or turn a blind eye to problems in our supply chain. On this you have my word."
Comments
Funny how Apple is putting out so much pollution after having just building the green energy plant for its servers.
Funny how Apple is short-changing its retail employees after having just drastically increased pay for retail employees.
Why can't we get some overseeing body to shut down these idiots in the media? That wouldn't be stifling free speech. It would be stifling lies.
Why no link to the OG NY Times story, AI?
I think I know how this one goes:
1. Apple sees problem.
2. Apple improves problem.
3. Media sees problem and sells ads with it.
4. Minor public outcry about problem.
5. Media inflates minor outcry into supposed scandal.
6. Media makes minor footnote about Apple's improvement.
7. Public believes Apple's improvement was only because they were forced into it.
8. ???
9. Media and Apple competitors profit.
The NYT has clearly made it their mission to create and spread the "Apple-is-evil" meme.
As "Tallest Skil" notes, reality does not have anything to do with what the "media" writes. They are on their mission, facts be damned.
The NYT definitely has been running with a lot of negative press about Apple recently.
Does anybody know what originally caused this 'falling out'?
Why no link to the NYTimes story? Because AppleInsider sticks its head in the sand when it comes to Apple not doing the right thing. The story originally showed up on nytimes.com but we're only now seeing it mentioned here on Sunday. Rest assured that if it was a story praising Apple, there would be a link on here published within 30 minutes. This site is basically a mouthpiece for Apple. I love Apple and its products, and enjoy this site's coverage of new products in the pipeline, but beyond that I've learned to look past its bias and take its spin on things like this with a big grain of salt.
"MyAppleLove", "IchLiebeApfel", all various other "supportive" Apple names from any other user…
Do you think we're complete idiots? Come off it.
I apologize in advance if this is harsh, but for the basic retail sales staff (not genius) how are they really different than any other retail job selling a product? Just because the company is successful doesn't make their position anymore valuable.
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First, I doubt their figures. The average retail salary in NY is about $31 K (http://www.indeed.com/salary/q-Retail-l-New-York,-NY.html), not $25 K. I wonder where they got their figures. It is extremely unlikely that Apple told them. More likely, they talked to a couple of entry level, incompetent employees and assumed that everyone made the same amount.
Of course, there's the other problem with this. Gap pays around $15 K - which is far less than even the NYT says Apple pays. Why wouldn't Apple be compared with a national retailer like GAP rather than some no-name boutique?
So what? The average Realtor would make about $30 K on selling a million dollars worth of homes - and they have to pay all of their own business expenses like advertising and transportation from that. OTOH, I know some business to business sales people who sold $100 M worth of goods and only earned $100 K.
That's really the key. If they're not paying enough, they wouldn't get employees. What ever happened to letting the market set wages?
So? He's free to go get another job if he has any skills that someone is willing to pay more for. If he doesn't have skills that someone wants to pay more for, then he's not no room to complain.
Oh, so there IS a way for the employees to earn more money. Get the skills and experience to become a Genius and make over $60 K.
Yep. It's pretty routine.
So what has Apple done wrong?
They've created thousands of retail jobs.
They pay wages comparable to the rest of the industry.
The offer working conditions that are desirable enough that there's a long line of people who want the jobs.
The offer upward mobility to the point where someone without any special education or skills can earn $60 K as a Genius.
So what would you have them do? By what rights should they pay more than the employees are worth? Where do you stop? Should they pay Fedex more than the going rate for shipping because Apple has lots of money? Maybe they should pay double for their taxes. And maybe tell the malls that they're not charging enough rent and Apple wants to add more to the rent.
They could afford to do all of those things - but it would amount to theft of shareholder value.
There was one article stating how much Apple Store retail employees make compared to Tiffany retail employees and then compared against revenue per sqft to determine that Apple doesn't pay enough. I only skimmed it but I doubt it made any mention to the level or expertise between employees, how many sqft they have to cover (only really matters if you want to to use sqft revenue as a metric), or any other qualification for the position.
Quote:
Originally Posted by RegurgitatedCoprolite
The NYT has clearly made it their mission to create and spread the "Apple-is-evil" meme.
I don't think that's it, exactly. The problem for the media is that a story is only worth reporting if it generates interest. If the media wanted to report on how much money oil companies make and how little of that profit trickles down to those who sell gas... nobody would care, which means the story generates no profit since it doesn't bring eyes to ads. I'm not saying that's how it should be, but it IS how it is. The more the web becomes a source of revenue, the more we're going to see reporting skewed toward anything-for-clicks rather than credible journalism.
Quote:
Originally Posted by thataveragejoe
I apologize in advance if this is harsh, but for the basic retail sales staff (not genius) how are they really different than any other retail job selling a product? Just because the company is successful doesn't make their position anymore valuable.
I would hope that the average Apple Store employee is more knowledgeable, helpful and friendly than the typical bored teenagers that "work" at Best Buy, and for that they should be better compensated. They may already be, I'm not suggesting they are currently underpaid. But some of Apple's value comes from their high level customer service which comes from the employees so it's not just any other retail job as you seem to suggest.
coming from the corporate sales point of view, retail sales is obviously a lower pay scale. How would i do it if I were in charge? Well, the scenario is that each employee generates about $470K a year. But the amount of GROSS profit generated is probably more like $188K if they are operating at a 40% gross margin, which is a GUESS based on Apple's TOTAL sales and GROSS margin. So, what is a fair amount to pay a RETAIL store sales person that has a fairly limited product line to know, but is basically a technical sales job rather than that of a clothing store. My way of thinking would dictate that they should have a minimum of an AA degree or higher, preferably a BS degree as well as having certain Apple certifications under their belt. For that, I think it is TOTALLY acceptable to pay them a minimum of $35K for entry level (AA degree with less than 2 years experience) and as they gain experience, certifications, etc., they could reach $50K a year (BA/BS, 3 years experience, certs.), plus stock options, etc. Turn over is crucial in these sorts of jobs. In order to retain employees, if you keep them happy and well paid, you can be more selective in who you hire, but also more demanding in terms of education and on-going certifications and training. The end result should be more motivated employees. In terms of bonuses, give them stock in the company.
Now, Apple's overhead costs will go up, but hopefully their turn over rate should decrease, employee moral goes up and it should offset one another. It costs a lot hiring an employee and training them as a new hire and it usually takes the average employee a couple of months to feel comfortable with their job and everything they are responsible for. But they should have a very good training program in terms of sales training, product training. Yeah, I am sure Apple's CFO might have a conniption fit regarding how much they would need to increase their employees pay, but then again, these are the people that interface with the public on a daily basis, these are the people in the trenches selling and servicing the products and they need to be paid well enough so they can enjoy their lives just like employees at corporate, which I am sure all make a minimum of $35K for bare minimum requirements and then raises as they achieve certain other goals like certain certifications, degrees, years experience. Most employees at corporate probably make a lot more than than that, plus stock and stock options, which ALL full time employees should get. Just because they work in a retail store does not mean they have to suffer financially for it.
so, as an Apple customer, I think it is completely reasonable. If the retail sales employees can demonstrate other capabilities, then maybe they can move into corporate sales, or phone sales, which should also enjoy a similar pay scale.
Now, in order to improve their image, I think they should wear polo shirts instead of t-shirts at a minimum. I think there should be sales people that have a BS degree, plus 3+ years business sales experience to also assist in local small business sales as well and they should be able to improve their pay upwards to $75K a year. In the corporate sales, they want BA/BA or higher, plus 3 to 5 years Corporate Sales experience, which is far more demanding and stressful, but requires far more experience and training.
Make the feet on the street happier, and they'll give it their all. People need to be able to pay their bills and live like a human being. The cost of living rises and so should their pay scale. They typically aren't hiring 18 year olds at Apple Stores, most of them are either in the late 20's, 30's, some are in their 40's and 50's. Treat them like humans. $25K is great if you're flipping burgers, but selling Apple products at an Apple Store is NOT flipping burgers. It requires a certain set of skills that flipping burgers doesn't.
If Apple is among the hight in terms of how much they do in the retail space, they should also be amongst the highest paid.
Glad you (AI) finally got around to giving it a nod. Everyone has pretty much seen it, at this point, and has noted the fact that NYT was way off at so many different levels. Not the least, comparing Apple's retail wages as % revenue to Tiffany and Costco that derive a vast majority of their revenue from their retail operations..... while Apple gets a third of its revenue from retail.
Just another silly hatchet job from NYT pretending to raise issues in the "high-tech industry" when all the stories they've done so far refer only to Apple and its products.
Link to NY Times article. I read it and it's not a hatchet job. Factual.
http://www.nytimes.com/2012/06/24/business/apple-store-workers-loyal-but-short-on-pay.html?ref=technology
What hourly wage do Best Buy and Apple start their respective employees out at?
Do you think demand for a position should play a role in how much you can pay an employee? I know if I was offered a network engineer job in both Cupertino and Redmond that MS would have to offer me at least 20% more for me to seriously consider taking it over Apple. Atmosphere, growth potential, benefits, perks, and many other factors do a play a role.
The other aspect that Apple should address is the small business market. People at certain Apple Stores that can also help in the development of iOS apps for businesses, Integration services for small businesses as well.
Apple does well in the market place for retail sales, but they could do much better in the small to medium business markets.
There are plenty of apps that they could display at the showrooms like cash register apps, accounting, and other specific small business apps. There are apps that address markets like Dentist, Doctor's offices, law firms, hair salons, restaurants, retail stores, and other small businesses that could be added to the Apple Store environment. This market segment is out there, but Apple should do something to address these markets.