Last year, Starbucks’ profits reached $2.8 billion on revenues of $19 billion, both record highs. In July one of the world’s most beloved coffee chain reached market cap of $82 billion. In a letter to employees on Monday, Starbucks chairman and ceo Howard Schultz announced wage raises ranging from 5% to 15% for all US employees, effective October 3.
As for Tuesday, the coffee giant announced that prices have gone up between 10 to 20 cents on select sizes of brewed coffee, and between 10 to 30 cents on espresso beverages and tea lattes.
Starbucks expects the increase to raise the average ticket price by 1% and notes that for 65% of its beverages the pricing has not changed. How much of a jump your favorite drink will see will depend on where you are. Last year the company raised prices between 5 and 20 cents.
In addition to a salary increase employees with at least two years of service will now receive double the amount of stock awards that are given out each November.
Starbacks employees also may select an insurance carrier and choose a coverage level that fits their needs, as well as a competitive price that fits their budget. The new health care options allow them to only pay for the coverage they want and will actually use. The company estimates that eligible partners could save as much as $800 annually by moving to a plan that better meets their needs. In case of selecting family coverage, savings are potentially more, perhaps as much as $2, 600 annually.
The wage hike reinforces Schultz’s longstanding commitment to investing in his employees’ success, and it positions Starbucks as a key player in the biggest economic story in America today, according Business Insider.