During my university education, we were taught that all what matters is shareholder value. The recent debate in the US about minimum wage is all about shareholder value. In human capital intensive industries (employing people is expensive and exhausting) shareholder value matters more than the people delivering the work being paid enough to live.
Google as a company understood from the beginning how important it is to keep your workforce happy and provided healthy lunch, laundry service and other nice stuff.
Of course, those perks are not for the servants of the engineers of other companies. Facebook shuttle drivers want to unionize because they work 15 hour shifts, and do not get to see their children anymore.
What is the US government (or all governments in the world) doing? They are taxing the people and not the corporations. The major sources of US government revenue are individual income and payroll taxes.
Source: Congressional Budget Office, data as of August 27, 2014
The workforce should be paid more and taxed less to get us out of the current mess. A Wells Fargo Wells Fargo Employee named Tyrel Oates emailed the CEO asking for a $10,000 raise (and he cc’d 200,000 other employees). Brave man and the letter isn’t a stupid one either.
Here is his email:
Mr. Stumpf,
With the increasing focus on income inequality in the United States. Wells Fargo has an opportunity to be at the forefront of helping to reduce this by setting the bar, leading by example, and showing the other large corporations that it is very possible to maintain a profitable company that not only looks out for its consumers and shareholders, but its employees as well.
This year Wells Fargo in its second quarter alone had a net income of $5.7 billion, and total revenue of $21.1 billion. These are very impressive numbers, and is obvious evidence that Wells Fargo is one of, if not the most profitable company in the nation right now. So, why not take some of this and distribute it to the rest of the employees.
Sure, the company provides while not great, some pretty good benefits, as well as discretionary profit sharing for those who partake in our 401k program. While the benefits are nice, the profit sharing through the 401k only goes to make the company itself and its shareholders more profitable, and not really boost the income of the thousands of us here every day making this company the prestigious power house that it is.
Last year, you had pulled in over $19 million, more than most of the employees will see in our lifetimes. It is understood that your position carries a lot of weight and responsibility; however, with a base salary of $2.8 million and bonuses equating to $4 million, is alone one of the main arguments of income inequality. Where the vast majority, the undeniable profit drivers, with the exception of upper management positions barely make enough to live comfortably on their own, the distribution of income in this company is no better than that of the other big players in the corporate world.
My estimate is that Wells Fargo has roughly around 300,000 employees. My proposal is take $3 billion dollars, just a small fraction of what Wells Fargo pulls in annually, and raise every employees annual salary by $10,000 dollars. This equates to an hourly raise about $4.71 per hour. Think, as well, of the positive publicity in a time of extreme consumer skepticism towards banks. By doing this, Wells Fargo will not only help to make its people, its family, more happy, productive, and financially stable, it will also show the rest of the United States, if not the world that, yes big corporations can have a heart other than philanthropic endeavors.
P.S. – To all of my fellow team members who receive a copy of this email. Though Wells Fargo does not allow the formation of unions, this does not mean we cannot stand united. Each and every one of us plays an integral part in the success of this company. It is time that we ask, no, it is time that we demand to be rightfully compensated for the hard work that we accomplish, and for the great part we all have played in the success of this company. There are many of us out there who come to work every day and give it our all, yet, we struggle to make ends meet while our peers in upper management and company executives reap the majority of the rewards. One of our lowest scored TMCS questions is that our opinions matter. Well they do! This email has been sent to hundreds of thousands Wells Fargo employees, (as many as I could cc from the outlook global address book). And while the voice of one person in a world as large as ours may seem only like a whisper, the combined voices of each and all of us can move mountains!
With the warmest of regards
Maybe at some point in the near future we will have a solution for the rising inequality. It will probably take many more emails like the above.