By Sebastian Herrera and Heather Haddon
The fight is on for lower-wage workers.
Some of the biggest U.S. employers of entry-level workers are
adding tens of thousands of new positions as the economy roars back
from the coronavirus pandemic. Many are raising wages or adding
perks to entice workers away from other jobs or off the sidelines
of the labor market.
Amazon.com Inc. said Thursday that it would hire 75,000 more
workers and offer $1,000 signing bonuses in some locations, its
latest hiring spree in a year of tremendous job growth at the
e-commerce giant. McDonald's Corp. said that it wants to hire
10,000 employees at company-owned restaurants in the next three
months and that it would raise pay at those locations. Chipotle
Mexican Grill Inc., Applebee's and KFC are among other chains
seeking to hire tens of thousands of workers as they reopen dining
rooms and seek to bolster staffing there.
Many companies have struggled to find enough available workers,
though there are signs that more are entering the labor market to
take some of those open positions. The Labor Department said
Thursday that jobless claims had continued a several-week slide to
new pandemic lows.
Demand for workers is so high that wages are rising, too.
Average hourly earnings for private-sector employees rose by 21
cents to $30.17 last month, according to a recent Labor Department
report. The gain is notable because strong hiring in the lower-wage
hospitality sector would typically put downward pressure on average
earnings, economists said.
Amazon said its open roles are offering average pay of $17 an
hour, an increase over its typical starting wage of $15 an hour.
The company in April said it was raising wages for more than
500,000 hourly employees receiving pay increases of between 50
cents and $3 an hour, an investment of more than $1 billion.
"The economy is starting to open up, and there is a lot of need
for new employees for a lot of different industries," Amazon Chief
Financial Officer Brian Olsavsky said in April.
McDonald's said it would raise wages for more than 36,500 hourly
workers at company-owned stores in the U.S. by an average of 10%
over the next several months.
The fast-food chain owns a fraction of its 13,900 U.S.
restaurants, around 95% of which are operated by franchisees.
The National Owners Association, a group representing U.S.
franchisees, said in an email to its members Sunday that strong
sales should allow operators the choice to raise menu prices, to
offset higher spending on pay and benefits.
"We need to do whatever it takes to staff our restaurants and
then charge for it," the association said.
Chipotle, which said Monday that it would raise wages at its
2,800 restaurants to an average of $15 an hour by the end of next
month, has also increased prices on delivery orders.
"They're able to offset the incremental cost of paying higher
wages with charging a little bit more for a burrito," Bill Ackman,
chief executive officer of Chipotle shareholder Pershing Square
Capital Management LP, said on Wednesday at The Wall Street
Journal's Future of Everything Festival.
Unions and activists have for years urged companies including
Amazon and McDonald's to boost wages. A labor-backed group called
Fight for $15 said Thursday that McDonald's should commit to that
minimum wage across all of its restaurants. The median hourly wage
for a U.S. fast-food worker in mid-2020 stood at $11.47, Labor
Department data show.
McDonald's said it decided to raise pay at company stores after
looking at what other restaurants were paying and as more states
and the federal government consider mandating minimum-wage
President Biden and other Democrats want to raise the federal
minimum wage to $15 an hour from the current $7.25. Legislation to
do so has stalled in Congress amid opposition from Republicans and
some Democrats. Pressure on lower-income wages as the economic
recovery accelerates is giving many workers pay that meets or
exceeds the goal without action from policy makers. McDonald's said
it expects the average wage at the restaurants it owns to reach $15
an hour by 2024.
Walmart Inc., the country's largest private employer, has raised
wages for some workers and plans to move more workers to full-time
status. The company starts many of its 1.3 million U.S. employees
at $11 an hour. Earlier this year, Walmart said it would raise
wages for about 425,000 of its U.S. workers, increasing its average
hourly wage to above $15 an hour, up from an average above $14 in
Walmart is promoting employee perks such as a $1 a day
subsidized university degree program for workers. In April, Walmart
said it planned to make about two thirds of its hourly workforce
full time by the end of the year. In 2016, around 53% of hourly
workers held full-time roles, the company said.
Amazon was among the first companies with a massive workforce to
boost wages to $15 an hour, a step the company took in 2018. It did
away with certain incentive pay and stock compensation around the
The company has said it is focused on improving conditions for
workers after employees at an Amazon warehouse in Alabama voted by
a wide margin to reject unionization. CEO Jeff Bezos said in April
that Amazon needed a better vision for employees. He has also said
the company will work to reduce injuries.
Amazon's steps, which came after it faced criticism from some
employees over the physical demands of its fulfillment center work,
also signal that on-the-job conditions might also come into focus
as employers seek to attract new workers. Amazon has said its
employees are treated fairly.
--Sarah Chaney Cambon and Sarah Nassauer contributed to this
Write to Sebastian Herrera at Sebastian.Herrera@wsj.com and
Heather Haddon at firstname.lastname@example.org
(END) Dow Jones Newswires
May 13, 2021 16:03 ET (20:03 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.