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When we asked them what makes a company just, the American public – across all demographics, including political affiliation – prioritizes fairness in compensation, in its broadest sense, above all else. And as our Senior Manager of Workplace Policies Research, Matthew Nestler, writes in Fortune this week, 87% of those we survey believe it’s a company’s responsibility to increase wages to keep up with the rapidly rising cost of living (including 93% of Democrats and 76% of Republicans).
Research from JUST and others has highlighted how relevant wage strategy is to business performance. A new survey report from Mercer found that 48% of retail and hospitality workers surveyed were considering leaving their jobs, and 59% of those said it was because their pay was too low. Yet we also know from our latest disclosure research that while Walgreens and VailResorts announced large real wage increases for their workers, and US Bancorp and Costco have announced multiple wage increases over time, most companies have not been transparent about their approach to pay.
Years ago when we were launching JUST, I remember the CEO of a large bank told me in no uncertain terms that there was “no chance” companies would ever be transparent about wages. Certainly, disclosure about wages overall remains very poor. Only 13% of America’s largest companies disclose some data about their employees’ hourly wages, and a mere 9% disclose the exact value of the minimum wage paid to their U.S. workforce. But mindsets are definitely changing. As the business case for “fair” wages becomes more compelling, and as companies themselves seek to build trust in their leadership on worker issues overall, expect more and better wage data to be forthcoming.
This Week in Stakeholder Capitalism
Amazon receives orders from a judge in the Eastern District of New York that it must stop retaliating against employees engaging in unionization efforts on Staten Island.
DoorDash announces layoffs for 1,250 corporate employees after growing too quickly during the pandemic.
HP cuts up to 6,000 jobs as computer sales fall and dampen the company’s outlook.
Rolls-Royce tests the first hydrogen-fueled aircraft engine, an important step to decarbonize flying.
Vail Resorts achieves its 100% renewable energy goal and stays on track for a net-zero operating footprint by 2030.
What’s Happening at JUST
Martin sat down Wednesday with Fortune’s Finance Deputy Editor Lee Clifford at the Fortune Impact Initiative on Thursday to talk about how companies need to move from “Rhetoric to Reality” to make sure capitalism works for more people and restore faith in business and markets.
Bruce Simpson and Talia Varley feature JUST in a worthy read in Harvard Business Reviewabout how companies can partner with nonprofits to improve their capabilities on critical issues like stakeholder performance and product innovation.
JUST Board member Peter Georgescu has an editorial in Forbes on lessons learned around how capitalism needs to, and is currently evolving, through the passion and commitment of emerging new leaders. And JUST advisor Hubert Joly discusses in Fortune why, despite challenging headwinds, this should be business leaders’ “finest hour” to connect their purpose with innovative growth opportunities.
(Chip Somodevilla/Getty Images)
“I view empathy as a hard skill. It’s not soft. This isn’t about being nice. This gives you a competitive edge. Empathy in our workforce has enabled us to attract and explore and retain an extraordinarily diverse group of people in our organization. We’ve become an employer of choice. People want to work here because of the positions that we’ve taken.”
– Jane Fraser, CEO of Citigroup, speaking on Fortune’s Leadership Next podcast on making empathy a key initiative at a U.S. bank.
“Real wages on average are falling, not rising. We don’t have one of the fundamental ingredients of a wage-price spiral, which is wages rise with inflation and it’s a vicious cycle upward. We don’t see that.”
– Mary Daly, President of the Federal Reserve Bank of San Francisco, speaking to reporters about wages as a cause of inflation.
“I think more venture capital money will be going into decarbonization. It’s not going to go to all this stuff that provided us good utility to get food quicker, or find a taxi sooner. I think it will be much more hard science, and require a lot more technical understanding.”
– Larry Fink, CEO of BlackRock, speaking at the New York Times’ DealBook Summit, on the future of venture capital post-FTX.
Must-Reads of the Week
Late yesterday, the senate approved a bill enforcing a railroad labor agreement ahead of the strike deadline, without the paid leave provision.
The New York Times reports on the shift toward stakeholder capitalism-focused curriculums at some of America’s most elite business schools. Wharton and Harvard are among campuses introducing MBA majors in DEI and ESG.
The need for a college degree is coming into question at companies such as Alphabet, Delta, and IBM. A tight labor market has pushed employers to hire candidates with relevant skills and experience rather than higher education credentials. U.S. job postings requiring at least a bachelor’s degree were at 41% in November, down from 46% at the start of 2019.
While potential job opportunities are opening up for some workers, demand for remote work is outpacing supply. The Washington Post reports on the drying up of the work-from-home economy and the continued push and pull between companies and job seekers in the post-pandemic labor market.
As layoffs mount for the tech giant, contract employees at Meta worry about their futures. Forbesreports on the workers who provide auxiliary services to the company and the instability they face without the same benefits afforded to full-time employees.
Chart of the Week
Despite the fact that our polling shows 89% of Americans favor the release of minimum wage rates for frontline and entry-level workers, only 9% of companies in our latest analysis disclose the exact value of the minimum wage paid to their U.S. workforce. The good news? Transparency is on the rise as evidenced by the chart above. Explore our latest wage analysis.
Get to Know JUST
Dr. Amy Glasmeier
Professor of Economic Geography and Regional Planning and Founder of the Living Wage Calculator, MIT
Dr. Amy Glasmeier is professor of Economic Geography and Regional Planning at MIT’s Department of Urban Studies and Planning (DUSP). She also runs LRISA, the lab on Regional Innovation and Spatial Analysis, in DUSP. Amy is also a Founding Editor of the Cambridge Journal of Regions, Economy and Society, a journal which publishes multi-disciplinary international research on the spatial dimensions of contemporary socio-economic-political change.
Amy developed the Living Wage Calculator at MIT, a tool employers and others can utilize to determine local living wage rates, in 2004. The Calculator and Amy’s expertise and research has supported the Worker Financial Wellness Initiative. She recently co-authored a JUST Jobs Explained piece with the JUST team, breaking down what a living wage is and why it’s an important compensation benchmark for businesses.