Home Depot allots $1B to raise hourly wages of employees

Home Depot said this week that it would raise the hourly wages of its employees, and for this, it is spending an additional $1 billion. This move comes as retailers and restaurant owners compete for workers.

Home Depot made the announcement regarding its latest investment in its employees’ salaries during its recent fourth-quarter earnings report. Then again, the company did not say how much the new average wage will be after the raise but mentioned that all the starting wage in the market is at least $15 per hour.

According to Fox Business, all employees with hourly pay rates will see an increase in their paychecks this month since the implementation already took effect on Feb. 6.

The retail giant said that the pay hike is applicable to hourly workers in Canada and the United States. Home Depot is the latest major company to offer a raise and this just shows that the labor market in the region is still scarce. In fact, based on the available data from the U.S. Bureau of Labor Statistics, the unemployment rate dropped to 3.5%, and the number of jobs in the private sector and government agencies was better than expected in December of last year.

While big tech firms such as Google and Amazon have laid off thousands of workers, restaurants, retailers, and hospitality firms have been hiring or raising salaries. Chipotle announced it would be on a hiring spree to get 15,000 staff aboard, while Walmart also revealed a pay hike for its minimum wage not long ago.

Home Depot’s chief executive officer, Edward Decker, said they have increased pay for all single front-line workers - both starting pay and senior workers. He said they are doing this to make them stay and increase the average tenure of the employees.

“We hope to improve retention through this and that is why we call it an investment,” CNN Business quoted Decker as saying during a conference with investors. “It is going to improve the customer experience. If we take care of our associates, they take care of the customer and everything takes care of itself.”

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