A $15 an hour minimum wage isn’t just for fast-food workers anymore.
Union-owned Amalgamated Bank in New York is now claiming it is the first financial institution in the country to have that salary for its employees. Amalgamated says the new policy takes effect immediately. Last month, a labor panel appointed by Governor Andrew Cuomo approved a plan to gradually raise the minimum wage of fast-food workers in the state to the $15 an hour level.
But Markus Schomer, Chief Economist, PineBridge Investments, tells Yahoo Finance he’s not sure these kinds of steps have had much of an overall effect so far.
“We’ve seen a lot of those wage announcements in the past 12 months and we’ve not seen any wage growth in any of the broader measures that we look at,” he points out. “So I think most of these announcements are somewhat questionable, maybe anecdotally interesting for the companies or the sectors, but I’m not sure they’re adding up to much wage growth.”
Schomer explains one reason may be because these kinds of workers make up just a small part of the U.S. economy.
“Only five percent of the workforce are on minimum wage or below,” he explains. “So the number of people affected by such announcements is relatively small.”
In a statement, Amalgamated CEO Keith Mestrich says he wants the rest of the industry to follow its lead.
“As one of the highest grossing industries, it is simply unacceptable that a significant portion of bank workers rely on public assistance. By raising our minimum wage, we’re hoping to reduce this egregious percentage and we’re calling on other banks to do the same.”
However, Yahoo Finance Senior Columnist Michael Santoli has his doubts that will happen.
“I don’t think we’re going to see a rush of other large banks, especially, do anything like this,” he argues. “Amalgamated is owned by a union, started by a union and has those roots of being in the interests of workers.”
Plus, Santoli says, boosting wages really doesn’t matter considering how so many institutions are cutting back on their workforce.
“Larger banks are reducing the number of branches and tellers,” he notes. “So even if they raised the wages-- which I think for a lot of people are surprisingly low for bank tellers and other workers in branches-- I don’t think it’s really going to change very much the strength of that part of the labor market.”