Some of America’s largest companies are finally increasing wages, and they are doing so loudly and proudly. Whereas in the past companies have downplayed annual raises, these days it seems like every executive wants a pat on the back for being a “do-gooder” because they decided to increase employee wages to a sustainable level.
As cynical as we might be about a company’s decision to increase wages, it’s hard to deny that it’s a step in the right direction. For some companies, bare minimum wages just aren’t cutting it anymore. That could be because the company’s leader believes in fair wages, or it could be a business decision to ensure the firm can attract and retain quality employees. Either way, it’s starting to benefit employees farther down the corporate ladder.
Further, this sudden interest in raising workers’ wages is a promising indicator of the recovering economy. It’s a marker experts have been on the lookout for, but up until recently has largely lagged behind other indicators of a healthy economy. In an age when more than half of American families make $60,000 a year or less, raising wages is critically important, as it could mean the difference between a healthy middle class and the rampant income inequality that continues to persist throughout the nation.
CEO Mark Bertolini, who heads up the health insurance company Aetna, told the Wall Street Journal that he doesn’t see why private industry can’t “step forward” and make “innovative decisions on how to do this [raise wages].”
“One of my goals has been to help re-establish the credibility of corporate America,” Bertolini said. He added that he wants to “bring everyone along instead of just a few.”
Paul Argenti, a professor of corporate communications at Dartmouth’s Tuck School of Business, says that the trend toward higher wages is decidedly a step in the right direction. “Trying to please consumers is a good thing, but trying to operate in society’s best interests will help you more,” he told The Washington Post. “It’s part of the bigger picture of how companies present themselves at a time when attitudes about business are pretty negative,” he added.
1. Ben & Jerry’s
An entry-level employee at Ben & Jerry’s headquarters now makes $16.29 an hour, according to company spokesperson Sean Greenwood, in an e-mail with The Huffington Post. The company arrived upon the figure based on the analysis of what a livable wage would be in Vermont, where the company is based. Even ice cream scoopers at the company’s shops make a decent wage, with most making at least $10 an hour, according to Glassdoor.com.
The health insurance company caused a stir when it announced in January that it would raise wages for its lowest-paid employees to $16 an hour beginning this April. The raise offers a more than 33% increase in pay from the company’s previous base pay rate of $12 an hour, with the average employee seeing an increase of about 11%. The company also plans to introduce a health care plan for all its employees later this year, according to The Washington Post.
Aetna has said its reasoning behind the increase in pay was to better attract and retain highly qualified workers, and CEO Mark Bertolini says he predicts that the move will help them maintain the quality of their front-line staff. The company’s decision to raise wages affected nearly 6,000 Aetna employees who were previously making around $12 an hour.
3. Whole Foods
Whole Foods may have yet to fully shed its “Whole Paycheck” reputation, but at the very least it’s good to know that some of that paycheck is going into its workers’ pockets. Whole Foods starting pay (for cashiers) is $11.50 an hour and the average Whole Foods employee makes $18.89 an hour, while the average annual salary is $39,289, making Whole Foods one of the highest paying retail employers on our list.
4. Gravity Payments
Okay, so most employees of this company already effectively made more than $15 per hour before CEO Dan Price made the decision to raise wages, but nevertheless the company’s announcement to raise wages was pretty impressive. According to Glassdoor.com, the lowest-paid employees at Gravity Payments made annual salaries of about $33,000, but all that’s about to change in the next three years.
Earlier this year, CEO Dan Price made a media splash when he announced that he was effectively raising the minimum pay rate for every employee in his company to more than $70,000 a year. Price came to the conclusion that $70,000 was a fair rate of pay when he read that for those making less than $70,000 a year, extra money can make a big difference in one’s quality of life, whereas over the $70,000 mark, extra cash has considerably less of an effect on happiness. Price then introduced a three-year program that would effectively raise the salaries of about 70 people on his 120-person staff to $70,000. For about 30 employees, the move will more than double their salaries, according to The New York Times.
Costco isn’t at the $15 an hour mark, yet. Currently, the company’s starting pay is around $12.50 an hour, but the average pay rate at the company is considerably higher. According to Glassdoor.com, the average employee at the bulk retailer earns about $21 an hour, not including overtime. Costco’s CEO, Craig Jelinek has been outspoken in his support for the movement to increase the minimum wage.
Further, about 88% of the company’s employees benefit from a company-sponsored health care plan, according to David Sherwood, Costco’s director of financial planning and investor relations, per The Huffington Post. The company has long had a reputation for social responsibility, and is committed to maintaining a decent living for its employees.