Jamie Dimon, CEO of JPMorgan Chase, announced in a New York Times op-ed column on Tuesday that the bank would soon raise wages for its lowest-paid employees. JPMorgan Chase—America’s largest bank, with $2.4 trillion in assets—has over 235,000 employees in over 100 countries, but the pay boost will cover only 18,000 employees in the United States.
“A pay increase is the right thing to do,” wrote Dimon. “Wages for many Americans have gone nowhere for too long.”
Dimon knows something about pay increases. Last year, JPMorgan Chase’s board gave Dimon a 35 percent pay increase, from $20 million to $27 million, even though the bank’s profits fell 2 percent and it laid off 6,671 employees.
Starting wages at JPMorgan Chase—which are now $10.15 an hour—will rise to between $12 and $16.50 an hour over the next three years, depending on the cost of living in specific geographic areas. In New York City and San Francisco, for example, the minimum wage would be $16.50 an hour, while it would increase to $15 an hour in Chicago and Washington, DC.
A JPMorgan Chase employee making $15 an hour working full-time would earn $31,200 a year. Dimon, who makes almost $13,000 an hour, makes more than that in three hours.
It turns out that about 90 percent of the employees who will get these wage hikes live in cities that recently adopted local minimum-wage increases to between $13.50 and $16.50 an hour over the next few years, according to Fortune magazine. In other words, in many cities JPMorgan Chase’s pay raises will simply comply with local laws or be just slightly above local minimums. The minimum wage in New York City, for example, will be $15 an hour at the end of 2018.
Fortune estimates that JPMorgan Chase’s pay hike will cost the bank about $50 million a year. In contrast, last year JPMorgan Chase paid its five top executives—Dimon, Mary Callahan Erdoes, Daniel Pinto, Gordan Smith, and Matthew Zames—a total of $99 million.
The banking industry is known for its extravagant pay scales, especially for top executives and managers. Last year, JPMorgan Chase and other Wall Street banks handed out $25 billion in bonuses to 172,400 employees based in New York City—an average bonus of $146,200, according to a report by the Institute for Policy Studies.