The U.S. economy may be setting up for a decade of growth according to the annual report from the Council of Economic Advisers released Wednesday. That reinforces why America’s largest employers continue to reward workers with pay hikes, one-time bonus payments and workplace perks.
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“The provisions of recently enacted tax legislation are expected to result in lower income taxes in 2018 for our operations in the United States, our largest market We expect the benefits of the TCJ Act will enable us to further strengthen our business by enhancing the skills of our front line associates to ready them for the future..." said PepsiCo Chief Executive Indra Nooyi in a statement earlier this month. Select workers will get $1,000 bonuses.
|MET||METLIFE INC. (METROPOLITAN LIFE INSURANCE COMPANY)||48.81||+0.30||+0.62%|
MetLife (NYSE:MET) also rolled out a plan to “strengthen financial security for U.S. employees” which includes paying a minimum wage of $15 per hour, more than double the federal average.
“As a result of tax reform, we are making a significant investment in our employees. We are enhancing pay and benefit programs and helping them develop skills that will make them more valuable members of our team,” Chairman, President and CEO Steven A. Kandarian said in a statement.
4.2 million hard working Americans have already received a large Bonus and/or Pay Increase because of our recently Passed Tax Cut & Jobs Bill....and it will only get better! We are far ahead of schedule.— Donald J. Trump (@realDonaldTrump) February 11, 2018
Thanks to more than 350 companies, more than 4 million Americans are receiving some combination of a wage boost, a one-time cash bonus payment of $1,000, higher pay or enhanced employee perks. That’s double the number from early January. President Trump touted the number in a tweet.
Deana Spoleti, a worker at Sheffer Corp. in Blue Ash, Ohio, who is getting $2,500 via a combination of a tax cut and a one-time $1,000 bonus, plans to use the money to help make ends meet, while also pursuing the dream of home ownership. “For my family, my husband Tim and I are in the process of buying a home,” she said during Trump’s visit to Ohio last week. The cash will also come in handy when her daughter and son head to college next year, she noted.
Along with cold hard cash, employers are now able to offer worker’s enhanced quality of life perks. Walmart (NYSE:WMT), the nation’s largest employer, is offering a new benefit to assist with adoption, paying up to $5,000 per child, while CVS Health (NYSE:CVS) is rolling out four-weeks of paid parental leave for select employees.
The foundation these companies are laying for themselves and their employees come on expectations that profits will see a solid uptick. With the corporate tax rate being cut to 21% from 35%, the S&P’s largest companies are announcing plans to repatriate cash from overseas accounts back to the U.S. with follow-on plans to reinvest in the U.S., which in turn should help the economy grow, say economists.
Last month, Apple (NASDAQ:AAPL), the world’s most valuable company, announced it will invest $350 billion back into America over the next five years. Currently the bulk of that cash is sitting overseas. While many of these companies will incur a one-time tax payment on those funds, the move paves the way for higher profits.
“That means every quarter next year, I mean every single quarter for every money making company in America will be up. Every single one, and that’s hard to imagine” said Howard Lutnick, chairman and CEO of BGC Partners (NASDAQ:BGCP), an offshoot of Cantor Fitzgerald, during an interview on FOX Business Network’s Maria Bartiromo’s “Wall Street Week.” The firm lost more than 700 employees and brokers during the New York City terror attacks on Sept. 11, 2001.
*Original story was updated on 2-20-18.
Suzanne O’Halloran is Managing Editor of FOXBusiness.com and a graduate of Boston College. Follow her on @suzohalloran