Bank of America increases minimum wage to $21 as labor shortages push up compensation

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Bank of America announced on Wednesday that it raised its US minimum hourly wage to $21, the next step in the company’s plans Raise wages to $25 by 2025.

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With employees being paid $21 an hour, their annual salary rises to $43,680.

In May, the company announced that all of its US vendors would have to pay $15 an hour or more to its employees dedicated to the bank.

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The change comes amid labor shortages across the United States, as companies struggle to hire and retain employees, especially those in low-paying jobs.

This increase would almost triple the Bank of America minimum wage of $7.25 per hour. However, in many states the minimum wage exceeds $12 per hour.

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IBank of America’s Minimum Wage Commitment: Bank of America to raise the minimum wage for its employees to $25 an hour by 2025

This also puts Bank of America ahead of many of its competitors.

America’s largest bank JPMorgan Chase & Co. minimum wage Between $16.50 and $20 per hour in 2019.

CitigroupThe US lender, the fourth largest, increased it to $15 an hour in 2019.

Wells Fargo said In 2020 it will raise its minimum wage to between $15 and $20 an hour, but its U.S. Not for all parts of. labor force.

Banking automation on the horizon?

While wages in the banking industry are rising, Wells Fargo recently released a report estimating that automation will cut 100,000 bank jobs nationwide over the next few years. bloomberghandjob

in one Interview With Bloomberg, Wells Fargo Managing Director Mike Mayo said: “The technology should enable banks to become more efficient than ever before in history, and that is to modernize back office branches and call centers.”

Mayo predicts that the jobs lost will be linked with increased investment in financial advisors as well as technologists in areas such as artificial intelligence, machine learning, big data, cloud computing and digital banking.

IAutomation amid the pandemic: Do we need humans for that job? Automation boom after COVID

Technology is paying off for investment banks, especially during the pandemic.

Bank of America, in Earnings presentation for the second quarter of 2021, recorded a record 40.5 million digital users, up 1.2 million year-on-year.

Bank of America noted in February 2021 Press release That 70% of its customers were digitally engaged for most of their financial needs, and digital channels became the primary way for customers to access banking needs.

Bank of America Virtual AssistantericaBecame the core to serve customers, with a usage of nearly 7 million customers erica For the first time last year. Launched in June 2018, Bank of America’s AI-powered virtual financial assistant now has a total of over 17 million users and has helped customers with over 230 million requests.

Bank of America declined to comment whether the wage increase was a sign of layoffs and increased automation and digital investment.

Bank of America employee number has been declining during the past decade, from a peak of 288,000 in 2010 to 213,000 in 2020, according to the Investment Research Forum. macrotrend.

However, over the years, Bank of America’s workforce has been growing steadily, with single-digit percentage growth since 2016.macrotrend.

At the same time, Bank of America has consistently raised its minimum hourly wage from $15 in 2017 to $17 in 2017 and $20 in 2020, with another $1 increase this year.

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