There's more good news about the job market besides the strong initial jobless claims report out today. But instead of Labor Department data, this comes from a cheesecake behemoth.
In April, we reported that the Cheesecake Factory was expecting to raise wages, but in their 2Q earnings conference call Wednesday that outlook just got even better for workers.
"We had anticipated back in February and then reiterated in April that we expected around 3% wage rate inflation for the year, and now I think we saw greater than that in the quarter. And we would expect to continue to see greater than that for the rest of the year, more in the 3% to 4% range," said CFO Douglas Benn.
An important piece to this is the wage pressure isn't just coming from increases to minimum wage workers, but at all levels of the company.
"So the higher inflation that we're now expecting compared to what we were really had nothing to do with minimum wage increases, which are part of wage rate because we knew what they were going to be," said Benn.
Additionally, Benn mentioned that workers have more options elsewhere so to retain workers the company has to pay more:
"And then in this environment over time as in the current environment makes staffing more challenging and more difficult in some of the locations that we have and that's part of wage rate pressure. It also includes people that work in the restaurant industry today have more choices than they've had in the past, perhaps that's putting pressure on what we think we're having to pay."This makes sense given that job openings are the highest they've been since 2001 and the voluntary quit rate is making a comeback.
This announcement by the company, which employs around 35,000, adds to the list of companies expecting or instituting wage increases that includes McDonald's, Bed Bath & Beyond, Wal-Mart and Target.
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