America’s second-largest bank, Bank of America Corp. Recently announced that it will boost its minimum hourly wage to $25, by 2025.
In January, JPMorgan Chase, the largest bank in the U.S., set their minimum wage at between $16 and $20. Other banking competitors set lower minimum wage goals.
Bank of America’s strategy is to attract more employees as businesses start to reopen more fully with the easing of covid-19 restrictions.
“A core tenet of responsible growth is our commitment to being a great place to work which means investing in the people who serve our clients,” said Sheri Bronstein, chief human resources officer at Bank of America, in the company’s statement. “That includes providing strong pay and competitive benefits to help them and their families so that we continue to attract and retain the best talent.”
As the U.S. economy rebounds from the pandemic, banks aren’t the only ones offering higher wages. A similar trend has been happening with retailers, fast-food chains, and ride-sharing apps alike.
Research shows that increased minimum wage causes a ripple effect. Employers who are paying wages just above the minimum feel pressure to increase their wages to stand out from the competition and attract talent.
“This will have a wage pressure up the line – we’ve absorbed it for many years,” said Brian Moynihan, Chief Executive Officer of Bank of America in an interview with CNN. “The key is for big companies like ours, is to set a standard.”