One of Pennsylvania’s biggest companies is boosting the wages of its workers. Sheetz, the gas and food chain, said last month it will spend $16.8 million more per year raising the wages of its workers from $9 to $10 per hour and it hopes to shift more employees from part-time to full-time work.
The company will also hire 3,000 more employees.
“As a family-owned and operated business, we know our employees are our most valuable asset,” said Travis Sheetz, president of Sheetz in a statement. “We are deeply committed to investing in our employees and creating a great working environment where they feel valued and have the resources they need to succeed.”
Other companies are following suit. Retail giant Target announced earlier this they were raising their minimum wage to $13 an hour in June and $15 by 2020. However, in the past month, there has been backlash from some who argue their part-time hours were cut, meaning less in their paychecks.
“I think there are a lot of factors that go into how companies set wage rates and historically low unemployment is certainly a factor and I think that’s part of the reason you’re seeing across the state and across the country, you’re seeing employers opting to raise their base wage,” said Alex Halper, director of government affairs for the Pennsylvania Chamber of Business and Industry. “It varies depending on the businesses.”
Pennsylvania’s unemployment rate stands at 4% (the Scranton/Wilkes-Barre area is 5.5%, according to numbers provided by the Bureau of Labor Statistics.)
“When unemployment is low their workplace is attractive to job applicants and to employees,” said Halper, “and that plays out in a lot of different ways in the company, the region or the industry.”
While Governor Tom Wolf has said he wants to raise the minimum wage to $12 an hour, he’s lost the battle in Pennsylvania’s General Assembly who argue it’s a job-killer. Pennsylvania’s minimum wage is $7.25 per hour – a wage that has not gone up in 10 years. It’s also the lowest amongst its neighbors.
“It’s always a political argument,” said Halper. “Unfortunately, a lot time and energy gets used up over the battle over the minimum wage when you wish lawmakers could help low income families in ways that doesn’t impact businesses. Employers have to get creative. It’s not an easy environment now for employers who have open positions.”
“Low unemployment has given low wage workers some bargaining power for the first time in 20 years and so wages are finally rising at the low end,” said Stephen Herzenberg, executive director of the Keystone Research Center.
He said near the border of New York and New Jersey, states that both raised their minimum wage, those looking for work can easily leave Pennsylvania to look for higher wages.
“The idea that one reason employment goes up when you raise the minimum wage is because turnover goes down and also companies fill vacancies more quickly so part of what is likely happening now is that if I can drive another five or 10 miles and get a 15% or 20% wage boost, I’m going to do that,” he said.
He said there are industries that are seeing a boost.
“Some of those industries just can’t find people because there’s so much competition,” said Herzenberg, adding that retail, the hotel industry and fast food restaurants are among those that are having trouble looking for workers. Wages in those industries have been stagnant for decades.
“Our goal is to provide competitive wages and full-time hours to as many employees as possible as well as providing quarterly bonuses as a way for employees to share in our success,” Sheetz said.