Yahoo Finance’s Brain Sozzi breaks down some of the major retailers that are opening up their checkbooks to reward tired workers ahead of the busy holiday shopping season.
JULIE HYMAN: Brian Sozzi has been keeping a tally of the companies this year that have been giving their workers a little extra pay in what has been a very trying year for many. And the latest appears to be Domino's Pizza that's giving its workers a little extra something.
BRIAN SOZZI: Yeah, Julie. This one was good to see, considering that Domino's exited its most recent quarter with nearly $500 million in cash. They are spending about $9.6 million to give its workers $1,200 bonuses. 11,500 company-operated-- company store workers and those that work in the supply chain.
So it's a good initiative by Domino's, after a year where, I think, their workers have worked like they have never worked before in their lives. And it's not just Domino's. Next week, December 24th, Walmart-- which has already announced this-- they will pay out $300 cash bonuses to full-time employees, and $150 cash bonuses to part-time employees. Starbucks just raised its wages by 10%.
So you're seeing, in a lot of these retail, consumer-facing jobs, a lot of these employees probably dealing with a lot of burnout, they are getting bonuses as an appreciation for their efforts throughout the year.
But Myles, staying on pizza here, or going back to pizza, epic stuffed-crust pizza out from Papa John's, announced this morning. We all know Pizza Hut has led in this category, really, what, for a decade, if not more.
MYLES UDLAND: That's right. I mean, I don't even remember when the stuffed-crust pizza commercials began. Papa John's getting in there.
And you know, Soz, we were talking earlier, like, where's Domino's in this? But look, their regular pizza is essentially a garlic bread pizza. So I don't really know how much more it needs to be improved. The cheesy bread--
BRIAN SOZZI: Ouch. Burn.
MYLES UDLAND: --on its own-- no, it's great. The cheesy bread, on its own, is fantastic. So if you need extra cheese to go with your cheese pizza, Domino's already has you covered there.
But you know, Soz, just going back to the-- and look, this is feel-good news. But feel-good news is also the companies giving their employees a bonus.
I think it really speaks to an interesting dynamic that might play out here, in the next couple of years. Because in 2014, '15, '16, we saw Walmart and Target, McDonald's, all start to slowly raise their minimum hourly wage for employees. You know, went from $9 to $10 to $11. You know, they're kind of playing catch up with Costco. They're kind of responding to legislation on higher minimum wage.
But they were also responding to pressures in the labor market. And so, to see these companies now reward their employees with a bonus on the back of the pandemic and all the risks that they took to continue delivering the product, continuing to work in the store, I think speaks to how much a company like Starbucks, like a Domino's, like a Walmart, with the resources, wants to protect its competitive advantage there with its employees, frankly, because we know, on the individual restaurant side, that's going to be a soft labor market.
But Domino's is still in a very competitive space with DoorDash, and with others. And to see them feel the need to continue incentivizing their employees to keep the job with Domino's, I think, is an interesting labor market dynamic. Again, as we enter a very strange economic period here for the next couple of years.
BRIAN SOZZI: Right on, Myles. And I don't think this will change dynamics for a Walmart and Target, in terms of their profitability. They're seeing, really, just strong growth throughout the board.
But it will change-- and my long-running thesis that it will change the fast-food business model. McDonald's has built a whole business on the backs of paying people essentially minimum wage. It could mean that $11 Big Mac, at some point. Somebody is going to have to eat these costs, and it's not going to be the executives at McDonald's.
JULIE HYMAN: Well, and also, you have to think of the flip side of this. The stories, the negative press a couple of years ago, when you have Walmart employees who are on food stamps, or trying to get aid to shop in Walmart stores, which is never a good look. So, I guess it just depends on what the market will bear, in terms of those eventual higher costs.