President Trump made a bold promise in November, one that few outside of Congressional Republicans believed could be done.
“We’re working to give the American people a giant tax cut for Christmas,” President Trump said at the White House. “We are giving them a big, beautiful Christmas present in the form of a tremendous tax cut.”
Despite united Democrat opposition and a disbelieving media, President Trump delivered on his promise, with House lawmakers giving final approval to the tax bill on the Wednesday before Christmas. But the presents didn’t stop with across-the-board individual tax cuts and corporate reforms designed to make our economy more competitive. Instead, they’ve continued in the form of businesses standing up and publicly pledging to use their savings to invest in their most valuable asset: Their workers.
“If we get it right, we’ll grow this economy. The president calls it ‘rocket fuel,’ I agree with that. Couple that with regulatory reform reducing the burdens on manufacturers who are simply trying to do the right thing and make ends meet and hire new people,” said Jay Timmons, president and CEO of the National Association of Manufacturers on CNBC’s Power Lunch. “I think there’s no end in sight to how we can grow this economy.”
Timmons was right. Things got off to a bang when Boeing, one of the nation’s largest manufacturers, announced $300 million in employee-related and charitable investment as a result of tax reform.
Media companies jumped into the fray with AT&T promising to give more 200,000 of its employees a special $1,000 bonus once the tax bill was signed and pledging to increase capital investment by $1 billion. Comcast NBCUniversal made a similar move, announcing special $1,000 bonuses for more than 100,000 non-executive employees as well as plans to spend $50 billion over the next five years on infrastructure improvements.
A string of banks followed suit, with Fifth-Third bank announcing a raise in its hourly wage to $15 and a one-time $1,000 for more than 13,000 employees. Not to be outdone, Wells Fargo announced it would match Fifth-Thirds wage hike and pledged up to $400 million in philanthropic donations.
And those were just the highlights from the day that tax reform passed. Less-reported, but no less important are the myriad companies who have quietly announced that they too would be paying out bonuses, expanding their businesses, raising wages or stepping up charitable investments in the wake of tax reform. For example:
- Bank of America, citing the “benefits from the tax reform,” will give employees making up to $150,000 per year in total compensation will receive a one-time $1,000 bonus.
- CVS Health pledged to hire 3,000 more workers, a result of their ability to “more rapidly expand our business model across the country and deliver better care and higher quality and lower cost.”
- Rush Enterprises, Inc., which operates the largest network of commercial vehicle dealerships, announced a $1,000 gift to its 6,600 employees citing the “beneficial” effects of tea reform for Rush and “overall economic growth.”
- Express Employment Professionals is giving its non executive employees a $2,000 bonus before the end of the year because of the expected savings from tax reform.
- Kansas City Southern, a transportation holding company, is giving a $1,000 bonus because of its “optimis[m] about what it could mean or our customers, investors and growth in the U.S. economy, as well as trade growth with Mexico.”
- Regional bank BB&T, announced $152 million in total investments, including raising its minimum hourly pay to $15, providing a one-time $1,200 bonus and donating $100 million to its philanthropic fund, made “possible through the tax reform package.”
- Idaho-based health care and home products company Melaleuca announced that it would give a one-time bonus of $100 for every year an employee has worked at the company, saying that “we’re going to have some more dollars to spread around. That money should go back to the people who built the company.”
Of course, this is but a small sample of the companies large and small that have pledged to invest their post-reform savings back into workers. And as Patti Domm writes for CNBC, don’t expect the tide to slowdown any time soon:
Expect a stampede of companies handing out bonuses, raising pay, spending on capital projects and giving to charities, with the windfall from the massive corporate tax cuts passed Wednesday. …
“This is exciting stuff. This is good. This is not just a whole bunch of guys saying I can buy back a lot of stock here and jazz up my numbers through financial engineering. This is a bunch of business leaders saying we can use this tax benefit to grow our company, keep our loyal employees and assist the community,” said Dick Bove, banking analyst at Vertical Group. …
But Bove said the fact companies have immediately given money to workers is a positive surprise, and it could boost the economy if enough do it.
“You’ll see more companies doing this,” said Quincy Krosby, chief market strategist at Prudential Financial. “It’s excellent PR after all the mantra across the aisle that it’s just a tax plan for the rich and for corporate America and for people who own stocks. … It’s a good PR move, giving back to the folks in the company.”
Republicans in Washington have given Americans a “big beautiful Christmas present,” now it’s up to employers to ensure that the benefits are passed on for a happy New Year.