The progress from the second-largest bank follows an earlier announcement from May when it vowed to pay its employees $25 per hour by 2025 and required all U.S. vendors to pay employees at least $15 per hour or more.
"Our company's focus on Responsible Growth requires that we provide a great place to work," said Sheri Bronstein, chief human resources officer with Bank of America, in the company's press release.
Bronstein said the move suggests "another step forward" as the company proceeds to raise the minimum wage for its workers and show its vow to enhance the workplace.
“A core tenet of responsible growth is our commitment to being a great place to work, which means investing in the people who serve our clients,” said Bronstein. “That includes providing strong pay and competitive benefits to help them and their families so that we continue to attract and retain the best talent.”
The $21 minimum wage hike follows the company's 2019 goal to raise its starting wage to $20 by 2021 — which was reached one year ahead of schedule. Bank of America went from having a $15 minimum wage in 2017, $17 in 2019, to $20 in 2020, according to the press release.
The Biden administration has been an outspoken supporter of raising the minimum wage to $15, a move President Joe Biden followed through with on April 27 when he signed an executive order requiring federal contractors to pay their workers a $15 minimum wage. Federal contractors were given a deadline of Jan. 30, 2022, to put the $15 minimum wage into contracts, followed by a deadline of March 30, 2022, to apply the new wage to the contracts.
Multiple states such as Colorado, California, Washington, and Massachusetts have already started finding supporters to the minimum wage. Colorado announced in late September it was preparing to raise its minimum wage to $12.56 by January, while California has a minimum wage of $14 per hour. Washington state has a minimum wage of $13.69, and Massachusetts offers $13.50.
Companies have proceeded to mention labor shortages related to the pandemic, even as federal unemployment benefits dropped about a month ago. The U.S. economy added 194,000 jobs in September, according to data published from the Department of Labor, marking the second month in a row of low job growth.
Following the publication of the dissatisfying jobs report, Biden tried to put a positive spin on the data, focusing on a lower unemployment rate at 4.8%, compared to 5.2% in August.