The Kroger Co. has revealed that it will make a more than $770 million incremental investment in its associates during 2023. The investment will be used to raise average hourly rates, improve health care options, build new training and development opportunities, and more.
"Our associates enable our success, and we are committed to investing in theirs," said Rodney McMullen, Kroger's chairman and CEO. "For so many, Kroger represents a first job, a new beginning or a change in career path. Continuing to raise wages and provide excellent benefits to our associates is one way we demonstrate how much we value and respect their contributions."
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The $770 million investment builds on the $1.9 billion incremental investments in wages and comprehensive benefits that Kroger has made since 2018, which has raised the company's average hourly rate to $18 or $23.50 per hour with benefits. Kroger's investments have also included:
- An educational benefit program that offers associates up to $21,000 toward continuing-education opportunities.
- Affordable and accessible health care options, among them free counseling through the company's Well-Being Assistant.
- First-of-their-kind free financial coaching services available to all hourly associates.
- A simple, intuitive onboarding experience to ensure every associate is confident in their role and ready to support their customers.
"Investing in our associates' holistic well-being is an essential part of what makes Kroger an employer of choice, and ultimately becomes an investment in our customers and communities," said Tim Massa, Kroger's SVP and chief people officer. "When we think about how we build our benefits, we want to enable every associate to thrive financially and emotionally – both in their careers and at home. We look forward to continuing to celebrate our associates and the many ways they show up for our customers and each other every day."
The additional investment in associates comes on the heels of impressive fourth-quarter earnings and a record fiscal year for Kroger. For its Q4, identical sales without fuel increased 6.2%. Total company sales were $34.8 billion, compared with $33.0 billion for the same period in 2021. Gross margin was 21.8% of sales, and operating profit totaled $826 million. Additionally, the grocer's private label identical sales jumped 10.1%, while its digital sales grew 12%.
As for its full FY22, Kroger saw a year-over-year total company sales increase of 5.2%, excluding fuel, to $148.3 billion, compared with $137.9 billion in 2021. Gross margin was 21.4% of sales for 2022, and delivered adjusted earnings-per-share (EPS) growth was 15%.
The grocer expects to bring this momentum into 2023 and deliver revenue and EPS growth on top of these record results.
Serving 11 million customers daily through a digital shopping experience and retail food stores under a variety of banner names, Cincinnati-based Kroger is No. 4 on The PG 100, Progressive Grocer's 2022 list of the top food and consumables retailers in North America. PG also named the company one of its Retailers of the Century.