Home improvement company Lowe's has offered hourly frontline workers $5,500 to ease the burden of high inflation. We offer million dollar bonuses. The retailer said on Wednesday's earnings call.
Lowe CEO Martin R. Ellison said: “These employees do the most important work in our company and we deeply appreciate everything they do to serve our customers to provide a best-in-class experience.”
Gasoline prices and transport costs have fallen slightly recently, but the impact of inflation is expected to increaseover the next 40 years-this year. High summer prices are still impacting Americans, making it more difficult for families to afford groceries and other essentials.Microsoft, ExxonMobil, Walmart, USAA and others are also , offering bonuses, raises and even gift cards to employees to offset rising costs. However, a survey conducted earlier this year by the Brookings Institution found that many of the country's major employers still do not pay their workers a living wage.
According to the company website, Lowe's employs approximately 300,000 employees, each The amount received is not specified. which period.
Corporate initiatives to raise wages and introduce such bonuses are usually done to retain employees, according to Larry Harris, chief finance professor at the USC Marshall School of Business. .
"The labor movement is very tight and we fear losing the workforce," Harris told his CBS News. “That is, they may offer bonuses, additional benefits, and raise wages, all of which are designed to make it more attractive to continue working at Lowe’s.”
"With the nationwide labor shortage we are seeing, businesses are looking for ways to retain their current workforce," he said.
There are several reasons for this labor shortage, Harris explained.
"The baby boomer generation retired en masse, and the birthrate began to decline 33 years before him. So children who enter the labor force from the age of 18 to the age of 25, he leaves the workforce." It's part of the people," Harris said. “Currently, COVID has not helped this. Many people find their lives to be much more fleeting than they thought and ask themselves, 'Do I really want to work or should I retire early?
While bonus money provides temporary support to Lowe's employees, it is not as useful as a raise, Harris said. “People prefer pay increases to bonuses because bonuses are temporary and wage increases are permanent,” said Harris. "I don't think Lowe's and others that are giving bonuses are ready to raise wages. They don't have to, but if they start losing employees, they will be forced to.
But these additional incentives are not without consequences. He said if businesses move to raise wages or add bonuses, the prices displayed in stores could be higher, increasing the impact of inflation.
"As spending increases, we have to increase the price of our products or they will lose money," Harris said. “There is a vicious cycle here in which higher product prices cause inflation, which reduces the value of wages. So wages need to be raised, but higher wages lead to higher product prices. It goes round and round."
- In:
- Minimum Wage
- Economy
- Inflation
Thank you for visiting CBS NEWS.
Create a free account or log in to
for more features.
