A customer walks into a Home Depot store on August 16, 2022 in San Rafael, California.
Justin Sullivan | Getty Images
Home deposit announced on Tuesday that it would spend an additional $1 billion to increase its hourly workers, as retailers and restaurants compete for workers.
The home improvement retailer announced the salary investment as it advertised fourth quarter results. He did not disclose the new average salary for employees, but said each market’s starting salary was at least $15 an hour.
Hourly workers will see the increase, which took effect Feb. 6 this month, in their paychecks. The increase will increase the wages of all hourly workers in the United States and Canada.
With the move, Home Depot becomes the latest major retailer to report that the labor market is still tight, especially for low-wage hourly workers. Through the work marketthe data is still solid: the unemployment rate fell to 3.5% In-farm and non-farm payroll growth was better than expected in December, according to the latest available data from the U.S. Bureau of Labor Statistics.
Several large technology companies and banks, including Google, Amazon And Goldman Sachshave laid off thousands of employees. So far, however, retailers, restaurants and the hospitality industry have largely bucked the trend – and even announced plans to hire or raise wages.
Walmart, the nation’s largest private employer, recently announced that it raise their minimum wage to $14 an hour for store workers and have an average US hourly wage of over $17.50, as of early March. Chipotle Mexican Grill say it wants to hire 15,000 restaurant workers ahead of its busy spring season.
THE companies have made these plans, despite industry watchers’ expectations of slower sales growth in the coming year. Businesses cited labor costs as one of the things driving up their budgets. But they also feel pressured to raise their wages as the prices of groceries, rent and other essentials rise.
Home Depot is one of the nation’s largest private employers with approximately 475,000 workers. The vast majority of its employees are hourly workers in its approximately 2,300 stores in the United States, Canada and Mexico. Its frontline employees, who will receive the wage increases, also work in supply chain, customer service and merchandising roles.
In an email to employees shared with CNBC, Home Depot CEO Ted Decker said the investment “positions us more favorably in all markets where we operate.” He said higher wages will improve the customer experience as the company attracts more high-quality workers and retains experienced staff.
“This investment will help us attract and retain top talent in our pipeline,” he said.
Home Depot has also added more training opportunities, he said, including promoting more than 65,000 employees in 2022 alone.