From Amazon to McDonald's, here's who's hiking wages amid the labor crunch
Despite increased vaccinations and easing coronavirus restrictions, the U.S. economy is experiencing a labor crunch that's prompting a number of companies to hike wages, in part to attract needed workers.
The strong COVID-19 rebound has lit a fire under the economy, but April's weak jobs figures stoked a furious debate about whether enhanced unemployment benefits were behind the worker shortage. As a result, a handful of states like Mississippi, Missouri, Montana, and South Carolina, have moved to end federal job aid early.
In the last few weeks, big-name retailers and corporations are upping wages and adding lucrative incentives in a bid to attract workers. In the meantime, Congress continues to fight over a $15 per hour federal minimum wage, in a sign of how worker wages continues to be a policy flashpoint.
Bank of America
Bank of America (BAC) announced on Tuesday it was boosting its minimum wage to $26 an hour by 2025, according to Chief Executive Officer Brian Moynihan.
This is not the first time the big bank has raised wages. In 2017, Bank of America hiked its minimum wage to $15 an hour. Just two years later, it said it will guarantee a $20 hourly wage over the next two years.
The bank hit that goal in 2020 — one year earlier than expected.
The Golden Arches (MCD) recently announced that it will raise hourly wages "by an average of 10%" for more than 36,500 employees at more than 660 U.S. restaurants.
"These increases, which have already begun, will be rolled out over the next several months and include shifting the entry level range for crew to at least $11-$17 an hour," the fast food giant said in a statement — adding that shift managers would be paid at least $15 an hour.
The wage increases will not apply to employees at the fast food giant's 13,000+ franchise locations.
Chipotle (CMG) said it would lift the average hourly wage for its restaurant workers to $15 an hour, in addition to offering employee referral bonuses of $200 for restaurant workers and $750 for general managers.
The company highlighted a track for new hires to become managers at several locations within four years — the position, dubbed a 'restaurateur,' pays $100,000 a year.
The tech giant (AMZN) revealed it would be hiring 75,000 employees across its fulfillment and transportation sectors, with average pay starting at over $17 per hour.
The retail giant touted sign-on bonuses of up to $1,000, in addition to "industry-leading benefits, which include health, vision, and dental insurance, 401(k) with 50% company match, paid parental leave, and access to various company-funded upskilling opportunities, including Amazon’s innovative Career Choice program, which prepays 95% of tuition for courses in high-demand fields."
Other retailers such as Best Buy, Costco, Signet and Starbucks have signaled their support for wage hikes over the past year — with many committing to hourly increases at $15 or above.
April jobs report underscores labor shortages
April's unemployment rate unexpectedly increased to 6.1% with only 266,000 jobs added. Bloomberg consensus estimates had expected an increase of 1 million jobs with a dip in the unemployment rate at 5.8%
The disappointing jobs report "could indicate that labor shortages are becoming a significant drag," Michael Pearce, senior U.S. economist for Capital Economics, wrote in a recent note.
Alexandra is a Producer & Entertainment Correspondent at Yahoo Finance. Follow her on Twitter @alliecanal8193
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