Some of America’s biggest corporations are (very publicly) raising the minimum wages of their employees. This is better than nothing, but not as good as, say, dangling a CEO by his ankles and shaking him until all of his billions fall out.
Raising wages is better than not raising wages. We can all agree on that. That said, how much moral courage does it take for CEOs to raise wages right now? Even Walmart, for chrissake, implemented widespread raises a full year ago, after years of heavy political pressure from activists. The political climate is clear. Inequality is not going away, and people are pissed, and on top of that, unemployment is relatively low, meaning companies need to compete harder for workers. Not raising wages is the bolder business move at this point.
That fact does not stop companies from extracting the maximum possible PR value from their decision to raise wages. Jamie Dimon, who makes $20 million a year presiding over a bank that not so long ago paid $13 billion due to its role in the collapse of mortgage securities that made tens of millions of people decidedly poorer, took to the New York Times op-ed page to bask in his own decision to raise the minimum wage of low-level JPMorgan Chase employees to between $12 and $16.50 per hour, from the current $10.15. If we do some very rough math, assuming that all 18,000 of these employees get an average raise of $3 per hour and work 2000 hours per year, that’s a total additional annual expenditure of $108 million by JPMorgan. Better than nothing, certainly. In the context of a bank that posts profits of more than $5 billion per quarter, this is peanuts.
In that context, it is kind of embarrassing to brag about this move in the New York Times.
Again—raises are better than no raises. But it should be understood that this country is currently in a period of economic inequality not seen in a full century. Wages for low earners must go up. Bragging about raising your minimum wage a few bucks at the moment is a bit like bragging about changing your tire after you ran over a box of nails. Good for you, sure, but if you didn’t do it, the whole system won’t work. When Starbucks (very publicly) announced this week that it is raising minimum wages in company-owned stores by at least 5%, it is worth remembering that this is a company that still is not unionized despite widespread worker complaints and a corporate reputation for liberalism. It is safe to assume a union would raise wages more than 5%. It is also worth remembering that Starbucks’ CEO, an inveterate self-promoter and narcissist, is worth more than $3 billion. All of these points are related.
Should major American companies raise wages? Yes. Should they feel good about themselves because they pay marginally more than fast food chains? No. Should we give fabulously wealthy CEOs moral credit for any of this? No. These are not expenditures on employee welfare. These are investments in workforce stability, PR, and, to a lesser extent, social stability in a nation that is wracked by inequality.
The least we can do is deny them the PR value.