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55,000 New Reasons To Be Bullish Amazon Stock

When many US companies struggle to fill their job vacancies, Amazon plans to hire more than 50,000 new employees. This could be good news for Amazon stock and the company’s growth narrative.

Amazon aims to hire over 55,000 new employees during its next Career Day, on September 15. The number may look small compared to Amazon’s total headcount of 1.3 million globally, 950,000 of whom in the US — out of curiosity, one out of every 153 US workers is an Amazon employee.

However, this could be a good sign for Amazon stock  (AMZN) - Get Free Report investors, as the new hirings feed the company’s growth narrative that took a hit following second quarter earnings.

Figure 1: Amazon fulfillment center.

Figure 1: Amazon fulfillment center.

(Read more from the Amazon Maven: AMZN Is The Only FAAMG Stock Off Its Peak. Buy The Dip?)

Keeping up with demand

As disclosed by Reuters, the demand is mostly for technology and corporate professionals to fill engineering, research science and robotics roles. Amazon hopes to position for growth in its e-commerce, cloud, computing, and advertising businesses — and even Project Kuiper, Amazon’s satellite internet venture that is a rival to Elon Musk’s Starlink.

In the wake of Amazon’s hiring efforts, notice below how important the headcount metric has been for the company’s revenue growth story. Amazon’s sales have increased in line with its workforce expansion (R-squared coefficient of 0.98). It is not a stretch to say, therefore, that Amazon’s ability to deliver on the top line is closely associated with the number of workers that the company attracts.

Figure 2: Amazon revenues vs. workforce.

Figure 2: Amazon revenues vs. workforce.

Growth plans: the key risk

Amazon’s goal of hiring 55,000 people is not an easy one to accomplish. As pandemic restrictions have slowly eased in 2021, many US firms have struggled to find suitable workers – especially in fields like engineering and business, in which highly qualified employees are not easy to find.

Neither Alphabet, Apple nor Facebook have announced a similar hiring program recently. Still, Amazon could be in for a fierce dispute for tech and business professionals with the other FAAMG giants.

Keep an eye on AMZN shares

Ahead of its upcoming Career Day, Amazon’s coffers look strong enough to finance its next round of expansion within e-commerce, cloud computing and secondary ventures. This could be the jolt of optimism in long-term growth that investors need to support the stock, which remains in a drawdown.

Because the Seattle-based behemoth has both the cash and the plans, the final piece of the puzzle lies with successfully hiring the extra headcount. From there, Amazon’s growth story can continue to unfold, likely fueling bullishness going forward.

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Pop quiz: how many US workers are employed by Amazon?

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(Disclaimers: this is not investment advice. The author may be long one or more stocks mentioned in this report. Also, the article may contain affiliate links. These partnerships do not influence editorial content. Thanks for supporting The Amazon Maven)