Retail is plagued with workers making less than $15 an hour, despite employers’ rising profits

Thousands of food, hospitality and retail workers are still earning less than $ 15 an hour, including most of the big store workers and discount retailers. This low salary contrasts with employers who make large amounts of profits, according to a new survey by the left-wing Institute of Economic Policy.

The survey included hourly wages reported by employees of more than 60 companies, including General Dollar, McDonald’s, Starbucks and Walmart. EPI analyzed the responses and found that 89% of McDonald’s workers earn less than $ 15, while 92% of General Dollar workers also earn less than $ 15. Survey data suggests states should raise their minimum wage, EPI said.

“Low wages are a defining feature of the U.S. labor market, and the service sector in particular,” PP economist Ben Zipperer said in a statement. “Low wages aren’t limited to mom and pop stores; they’re also spreading to big stores, restaurants, and grocery stores that often have high-income and high-income CEOs.”

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About 63% of Starbucks employees earn less than $ 15. At Walmart, 51% of workers also earn less than $ 15, according to the PPE survey, which was conducted between March and November last year. The survey, which garnered more than 20,000 responses, also points to companies where most workers earn more than $ 15 an hour, including Amazon, Costco and UPS.

Walmart raised its minimum wage to $ 12 an hour last September, the Wall Street Journal reported. Dollar General did not respond to requests for comment on their salaries.

De facto wage standard: $ 15

The United States has seen a tight labor market over the past two years as employers have tried to lure workers back from coronavirus pandemic blockages. Considered an agreement sweetener, $ 15 an hour has become the de facto wage standard among companies competing to hire new staff, the Associated Press reported.

McDonald’s announced last year that it plans to raise its minimum wage to $ 15 an hour in 2024 at company-owned locations, while Starbucks is expected to introduce a minimum wage of $ 15 an hour. this summer.

But the EPI poll, released on Tuesday, suggests that not everyone has been offered the new standard wage.

“Wages are too low for too many service workers, millions of whom were on the front lines during the pandemic,” said Harvard University professor of public policy Daniel Schneider, who helped conduct the survey. , in a statement. “But these data also show that higher wages are more than possible. They are already a reality for the workers of some of the largest companies in the country.”

As a result of a pandemic-fueled labor shortage, the average hourly wage rose 5.1% between February 2021 and February 2022, according to U.S. Department of Labor data, the highest . salary increase for front-line employees, like grocery workers and retail workers, have seen it in more than a decade. However, consumer prices rose by almost 8% during the same period.

The average American will be poorer this year

Those numbers mean the average American is likely to be a few percentage points poorer this year, Columbia University finance professor Laura Veldkamp told CBS News.

Even for those who received the seemingly robust earningsthe increase only amounts to “cents” per hour once inflation is included, according to a Brookings Institution analysis, as supply chain constraints and robust economic demand combined with US corporate sanctions Russians, drive large increases in the price of food, energy and other items.

“You have to ask for a pay raise if you want to reduce equality or balance,” Veldkamp said.

Meanwhile, the US federal minimum wage has remained steady for the last 12 years at $ 7.25 an hour.