Bank of America workers are getting a pay bump at the end June when minimum wages climb to $22 as a part of the major bank’s longstanding plan to get its starting rate to $25 by 2025.
It’s good news for the bank’s workers at a time when inflation keeps increasing the cost of living. Bank of America
has almost 166,000 U.S. employees and approximately 15% will see larger paychecks due to the minimum wage increase, a spokeswoman said.
But the big bank’s pay raise — amounting to a $45,000 yearly salary — might feel like an unattainable number for people working elsewhere.
That’s because the $22 rate is more than triple the federal minimum wage of $7.25, which lawmakers last increased in 2009. And $22 breezes past the $15 hourly wage so many workers are advocating for, if they don’t have it already.
An estimated 51.9 million American workers are earning less than $15 an hour, according to Oxfam, a global poverty charity. There are more than 150 million non-farm employees working in America, according to Bureau of Labor Statistics data compiled by the Federal Reserve’s Bank of St. Louis.
Average hourly earnings were $31.85 in April, according to the St. Louis Fed data.
“Bank of America announced the increase from $21 on the same day gas prices broke a new national average record yet again.”
The Oxfam report in March noted minority workers made the outsized share of people earning less than $15. Researchers said 47% of Black people made less than $15, compared to 26% of white people.
One half of all working women of color made less than $15/hour, the research said, calling its findings “shameful.”
In 2022, workers were poised for minimum wage hikes in 25 states. California reached $15, the highest statewide minimum wage, though Seattle, Wash., set its rate at $17.27. That still leaves a large swath of states where the minimum hourly pay is $7.25 due to state law or application of federal law, according to the Department of Labor.
In 2020, there were 1.1 million workers with earnings at or below the $7.25 federal minimum wage, the Bureau of Labor Statistics said last year. But it said the findings had to be taken with caution because the number reflected the impact of the pandemic, which devastated the market for lower-paying service sector jobs in COVID-19’s early stages.
In an extremely tight job market, Bank of America’s announcement Monday framed the minimum wage increase from $21 to $22 as an effort to find and keep personnel. “Our focus on being a great place to work is core to everything we do and underscores the role our teammates play in our success,” said Sheri Bronstein, the bank’s chief human resources officer, said in a statement.
But the soaring price backdrop is unavoidable.
Exhibit A: Bank of America announced the increase from $21 on the same day gas prices broke a new national average record yet again, this time for $4.59, according to AAA — and it’s not even Memorial Day yet.
President Joe Biden wants to raise the minimum wage to $15 and he’s already signed an executive order so that rate applies to federal workers and contractors. But in a closely-divided Senate, some say turning that to law could be a tough task.
Bank of America shares are down almost 20% so far this year. The Dow Jones Industrial Average
is down almost 13% and the S&P 500
is down more than 17% year-to-date.