Only two percent of U.S. adults say they received a bonus or wage raise as a result of the Republican tax legislation passed in December, according to a Reuters-Ipsos poll released Monday.
In the poll, 58 percent of respondents said the GOP tax bill benefits the wealthy and corporations, while just 13 percent say it benefits the middle class.
This poll seemingly pokes a hole in the Trump administration’s theory that reducing the corporate tax rate from 35 to 21 percent is having a significant positive effect on anyone other than large corporations.
While corporations like Wells Fargo and Walmart have opted for long-term wage raises over one-time bonuses, there is more to this trend than meets the eye.
Wells Fargo announced soon after the passage of the tax bill that they would raise their minimum wage to $15 an hour. Some Wells Fargo minimum wage workers, however, were likely already receiving $15 an hour. This is because at the beginning of 2017 the bank had announced it was raising its minimum wage base to $13.50 to $17 per hour for entry-level positions. That was a 12 percent increase from March 2016 and a 19 percent increase from December 2013, according to the Charlotte Business Journal. By raising the wage to a flat $15 from $13.50, Wells Fargo was likely just responding to pressure from the labor market and playing catch-up with other banks like JPMorgan and Bank of America — both banks that raised their minimum wages to $15 an hour in 2016.
“There’s no way this was just done as a result of the tax bill getting passed. I’m glad they are doing it, but the market for talent is tightening. We’ve been seeing a bit of wage demand across the board at all levels of banking, and I can’t imagine we’re the only bank,” said Keith Mestrich, president and CEO of Amalgamated Bank to CNBC. Amalgamated Bank raised their minimum wage to $15 in 2015.
The White House has repeatedly praised business like Wells Fargo, Walmart, and JPMorgan Chase for announcing wage raises or bonuses in light of the massive tax windfall they are expected to receive. Eight of America’s biggest banks will receive a $15.3 billion windfall in 2018 as a result of the tax bill, according to a Goldman Sachs report.
The bonuses these corporations and big banks have planned are, in many cases, pre-planned, and only a drop in the bucket compared to the total overall cost of the corporate tax cut. A ThinkProgress analysis of the over 50 businesses planning to award non-executive employees with a “tax bill bonus” found that a mere .1 percent of the trillion dollar corporate tax cut will be spent on employee bonuses.