June 18, 2024


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Home Depot investing $1 billion annually after employee pay increase

  • Home Deport has seen record sales numbers as the pandemic has kept customers home and led to a surge in home improvement projects. 
  • The company is reinvesting some of that money into its core retail employees, to the tune of $1 billion in costs annually going forward. That investment applies primarily to a one-time increase in employee pay, both part-time and full-time, company executives said on Tuesday morning.
  • We believe that our associates are a competitive advantage to the Home Depot, and they’re critical to the overall customer experience,” they said.
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Riding on a wave of surging sales, Home Depot says it’s investing $1 billion annually into employee wages going forward.

The home improvement retailer has seen huge sales increases throughout the year due to increased pandemic spending on home goods, maintenance, and DIY projects. To help offset the increased workload, Home Depot offered temporary bonuses and increased time off. Those temporary steps are being converted into one-time permanent raises.

“The company is now transitioning from these temporary programs to invest in permanent compensation enhancements for frontline, hourly associates. This will result in approximately $1 billion of incremental compensation on an annualized basis,” Home Depot said in a statement on Tuesday morning.

Executives clarified how that would work during the third quarter investor call on Tuesday morning.

“This investment is essentially in wage,” execs said. Wages specify pay, rather than other forms of employee compensation, like additional time off or benefits.

And the one-time pay increase applies to all hourly Home Depot staff, they said: “It’s all of our front line associates, essentially. Whether they’re full time, part-time — doesn’t matter.”

Though much of the US economy is still struggling with the ongoing impacts of the coronavirus pandemic, some sectors have seen a massive boost. Home Depot is part of that lucky latter group, according to the company’s latest earnings report: Overall net sales beat analyst estimates, increasing 23.2% to $33.54 billion.

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