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Lowe's promises to compensate employees with new inflation bonus

Yahoo Finance anchors discuss the worker bonus Lowe's announced during its earnings call.

Video Transcript

DAVE BRIGGS: My play is Lowe's, who, as you know, reported earnings yesterday, right in line with the same period last year. And Lowe's today announcing from their president and CEO, Marvin Ellison, they'll dish out $55 million with the bonuses to frontline associates to, quote, "help them during this period of high inflation." Employees will receive that bonus in early September. Ellison adding, these associates have the most important jobs in our company, and we deeply appreciate everything they do to serve our customers.

Lowe's has more than 300,000 employees. Shares down more than 15% year to date, really flat on this news. And it's hard to interpret moving forward what happens with Lowe's and Home Depot because when you look at Home Depot, they deal with more pros, whereas Lowe's deals with far more of the home improvement everyday individual, like myself. So they might not hurt as much with a falling housing sector as much as Home Depot does. That's the theory, anyway, and that's a theory floated by their CEO.

SEANA SMITH: Yeah, and that would, of course, really benefit them, at least when we see this constant cooling over the last couple of months of the housing market. It's interesting when we see Lowe's the latest company here reach out and give their employees bonuses. And I think it really speaks to what's going on right now. One, it's great for company culture. You're actually acknowledging the fact that it's a very tough environment right now with inflation at the highest rate that we've seen in about 40 years.

And it also speaks to the tight labor market, right? People are doing-- executives that are doing everything they can to retain the talent that they have. And it's very-- I mean, it's smart of these leaders to do that at this time.

It sets an interesting standard, too, right, for some other companies. Because now you have Lowe's willing to give this inflation bonus. I think people are going to be looking and saying, well, where's mine? How do I get that? And that's going to be something to follow, I think, within the sector as well. Does Home Depot do it?

DAVE BRIGGS: Does it mean Home Depot? Yeah, there's a few 100,000 Home Depot employees who are calling for theirs. But it is a good move. It is hard to hire in this climate. This is one way, at least, to retain, if not to recruit. Josh, good to see you, my friend. Thank you.