In the United States, employees of Exxon Mobil Corp (Exxon stock) are receiving pay raises higher than the rate of inflation just a few short weeks after the Texas oil giant posted its highest quarterly profit. This move highlights how strong 2022 has been for the fossil-fuel industry compared to other industries, such as technology and finance, which have been cutting jobs.
According to people familiar with the matter who asked not to be identified discussing non-public information, workers will see an average salary bump of 9%, and those who got promoted will see an additional 5% increase. Both of these increases are based on private information. The current value of the consumer price index in the United States is 7.7%.
According to statements made by spokeswoman Amy Von Walter on Wednesday, this is Exxon’s most significant compensation award in aggregate form in the past 15 years. Additionally, the company provides restricted stock options to 14,000 employees worldwide. This represents more than a fifth of the company’s workforce and is an increase from the previous year’s figure of 5,000. She stated that around one-third of employees worldwide had received promotions this year.
Following three challenging years, Exxon’s pay awards represent a turning point for rank-and-file workers in the oil and gas industry. Exxon froze salaries, conducted its first round of significant layoffs in decades, and stopped matching contributions to 401(k) plans (its traditional pension was unaffected). As a result, Exxon faced a higher employee turnover rate than had been typical in the company’s past. On average, it provided workers with wage raises lower than the inflation rate last year.
But rising prices for oil and gas in the wake of Russia’s invasion of Ukraine, combined with Chief Executive Officer Darren Woods’s vigorous efforts to slash costs, have helped Exxon’s fortunes turn around in recent years. The company has been in business for 152 years, and its profits for the second and third quarters were their most extensive.
According to those aware of the situation, an employee’s pay at Exxon dramatically depends on where they fall within the company’s performance review system. According to these people, some of the company’s top performers who got promoted received 15%, and 25% raises. The salary raises of more than ten percent come when many major technology businesses are downsizing their personnel, and Wall Street banks are lowering the amount of money available for bonuses.
According to Von Walter, “The performance of our company is a reflection of the hard work, devotion, and tenacity of our people.” Although it was a period of enormous upheaval and uncertainty, our teams nonetheless managed to produce remarkable business results, for which we feel great pride.
In an announcement made earlier this week, Exxon (NYSE:XOM) confirmed that it had increased the salaries of its top executives by 10%. In June, workers in the United States received a one-time cash payment equal to three percent of their annual salary. Despite the recent decline in the price of crude oil, the stock was still up roughly 70 percent so far in 2018. Exxon has recently made its way back into the top ten most prominent firms in the S&P 500 Index.
Exxon Stock Price Gains
Because of the worsening forecast for the economy, it is highly doubtful that workers all over the economy will be able to command wage increases that are on par with inflation in the coming year. However, those employed in the oil industry appear to be among the winners. According to the statistics provided by the Bureau of Labor Statistics, nonsupervisory workers in the oil and gas extraction industry saw their average hourly earnings increase by more than 13% year over year in October, reaching about $42 in the process. Since the latter half of 2016, this year has seen the most significant annual increase.
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