MONEYWATCH: Willie Sutton allegedly said he robbed banks because “that’s where the money is.” But for today’s bank tellers, that remark could appear as a cynical jibe given that one-third are on government aid due to low wages.
Taxpayers spend $899 million annually in state and federal benefits to support bank tellers and their families, according to a new report from The Committee for Better Banks.
One-third of bank tellers receive some sort of public assistance, ranging from Medicaid to food stamps, the financial industry employee advocacy group found, citing research from the University of California-Berkeley Center for Labor Research and Education. In New York state, almost 40 percent of bank tellers and their family members are enrolled in public assistance programs, costing the state and federal governments $112 million in benefits.
“Bank workers in New York, across the nation and around the globe are being squeezed, very much as other hourly workers in the economy are,” the report noted. “Banks’ internal employment practices, just like their external practices, increasingly drive inequality.”
It’s not as if banks can’t afford to pay their tellers more, judging from a surge in executive pay: Compensation for the top 50 financial chief executives rose by 20 percent in 2011 and 26 percent in 2010, the study notes.
Take Wells Fargo (WFC) chief executive John Stumpf. Listed as one of the country’s most overpaid CEOs by Bloomberg, Stumpf earned $22.9 million in 2012, a raise of almost 16 percent from his 2011 pay of $19.8 million. That makes him the highest-paid top executive among the country’s top commercial banks, according to The Wall Street Journal. Profit for the company jumped 19 percent in 2012, helped by a surge in mortgage-banking income.
So what does the average teller at Wells Fargo make? Less than $11 an hour, or about $22,600 a year, according to job site Glassdoor.com. While that’s above the federally mandated baseline wage of $7.25 an hour, the pay is low enough to qualify a family of four for food-stamp benefits.
“It’s not a livable wage,” Alex Shalom, 20, a part-time worker at Bank of America (BAC), told the Washington Post. “Bank of America is making all of this money . . . but we’re not getting paid for holidays.”
Wells Fargo isn’t the only bank benefiting from the recovering economy. The U.S. banking industry last year posted its highest profits since before the financial crisis, according to data from the Federal Deposit Insurance Corp. Many banks also received help from the U.S. government through its bailout program.
The report comes when fast-food workers are organizing strikes and protests against what they say is unfair pay. Bank workers, too, are planning their own protests, the Post notes. The Committee for Better Banks is organizing a rally to protest Bank of America’s increasing use of ATMs with remote tellers.
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