Kroger, other retailers see ‘eye-popping profits’ as workers reap little benefit – Detroit Free Press


Shoppers exit the front entrance of Kroger Marketplace on Dec. 2, 2020, in Royal Oak.

Profits soared an average of 39% in the first half of the year at supermarket chains and  other food retailers thanks to the pandemic, although frontline workers reaped little or no benefit, a new report shows. 

At Cincinnati-based The Kroger Company, which has 119 stores in Michigan, profits for the first two quarters were up a staggering 90%, according to the report from the Brookings Institution, a Washington, D.C.-based think tank. 

“We find that while top retail companies’ profits have soared during the pandemic, pay for their frontline workers — in most cases — has not,” the report said.

The report, released Nov. 20, revealed inequalities between retail workers’ pay and company profits during the pandemic. Profits earned at top retailers were described as “eye-popping,” even as most quickly ended so-called “hero pay” that was offered at the beginning of the pandemic in the form of bonuses or temporary bumps in pay for workers.

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Among the retailers cited in the report:

  • Kroger saw its net earnings for the first two quarters jump to more than $2.031 billion compared to $1.069 billion in the same period of 2019. Third quarter profits, which were reported Thursday, were not included in the Brooking Institute report. When those are included, the company’s net earnings of $2.662 billion are up just short of 100% for the first three quarters compared to 2019.
  • Walmart profit was $15.6 billion for the first 3 quarters compared to $10.7 billion for the same period for 2019, a 45% increase. 
  • Amazon, which owns Whole Foods, saw a $17.4 billion profit for the first three quarters, up $6 billion from the same period last year. That amounted to a 53% increase.
  • Costco’s profit was $2.2 billion for the first two quarters of 2020, an increase of $244 million from 2019 or 11%.

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Overall, the report revealed, retail companies cited in the analysis earned, on average, an extra $16.9 billion in profit in the first quarters of this year compared to last year, as grocery stores and their workers became a lifeline for people during the initial lockdown. 

Despite record-breaking profits at stores, many grocery workers saw hazard pay — typically an extra $2 per hour at the onset — taken away and replaced in some instances with bonuses, sometimes in gift card form. 

Kroger was listed under the report’s “laggards” category. Under the company name was “from hero pay to zero pay.” At the time of the report, it had been 181 days since Kroger workers received hazard pay. 

Kristal Howard, a Kroger spokesperson, said the company has invested more than $1 billion since March to reward its associates and safety measures to protect them and customers. In September and November, frontline associates received a $100 store credit and 1,000 fuel points. 

Howard added that Kroger continues provide benefits like paid emergency leave and financial support to associates facing hardships due to COVID-19 through its $15 million Helping Hands fund.

“Our most urgent priority throughout this pandemic has been to provide a safe environment for our associates and customers while meeting our societal obligation to provide open stores, e-commerce solutions and an efficiently operating supply chain so that our communities have access to fresh, affordable food and essentials,” Howard said.

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