Bank of America has announced a raise in its national minimum wage to $24 per hour, resulting in a minimum annual salary of approximately $50,000 for its full-time employees.
This increase is part of the bank’s long-term plan to raise its minimum hourly wage to $25 by 2025. Since the wage initiative began in 2017, the bank has significantly increased pay, marking an impressive 60% wage hike over the past seven years.
The bank’s decision to raise wages reflects a broader industry trend, as financial institutions face mounting pressure to offer competitive salaries in a tight labor market. Major banks like JP Morgan and BNY Mellon have also raised wages, responding to the rising cost of living and the need to retain talent. For comparison, Bank of America’s $24 minimum wage far exceeds the national minimum of $7.25 and is higher than the wage laws of all US states.
While the pay raises are aimed at attracting and keeping employees, Bank of America has seen a reduction in its overall workforce. Since 2018, when the wage increase program was first introduced, the company’s headcount has fluctuated. It grew from 204,000 employees in 2018 to a peak of 217,000 in 2022 before shrinking to 213,000 last year. This reduction mirrors a larger trend in the banking industry, which has shed 33,000 jobs in the past year alone. With rising automation and technological advances, the sector has increasingly leaned toward AI and tech-driven roles, potentially shifting the types of jobs available in traditional banking.
Despite the workforce reductions, Bank of America remains committed to enhancing its employee compensation. The company has also introduced a variety of benefits beyond wages, including paid parental leave, sabbatical programs, and a professional development academy, all designed to make the bank an attractive workplace. According to Sheri Bronstein, the bank’s chief human resources officer, offering a competitive wage is central to fostering a positive work environment and retaining top talent.
With input from Market Watch, Reuters, Axios, and Fotrune.
