News Worms
News Worms

Walmart Hikes Wages as Labor Market Tightens

Walmart Hikes Wages as Labor Market Tightens

Sam's Club president and CEO John Furner says, "we will be closing some clubs, and we notified them today".

Walmart (NYSE:WMT), the nation's largest employer, with 1.5 million USA workers will allow the majority of those employees, 1 million, to share in the benefits of the largest sweeping tax reform in three decades.

On the downside, Walmart -on the day of the wage increase - said they were closing some of their Sam's Clubs Warehouse stores.

The timing of the store closure announcement hours after the wage hike drew some criticism. Employees are also getting a one-time bonus of up to $1,000.

The world's largest retailer said the moves, which also include expanded parental leave benefits, will affect more than a million hourly workers in the U.S.

Walmart, the world's largest retailer, announced Thursday it's raising starting minimum pay to $11 an hour, beginning in February.

The announcement of the bonus payouts by the retail company comes after Waste Management, Bank of America and JetBlue recently made a decision to pay its employees bonuses following the new tax legislation put into effect by Congress in December 2017. "Companies were already raising wages even before the tax cut passed in response to a tight labor market, grassroots pressure from groups like the Fight for $15, and the rush of minimum wage hikes from California to NY".

Walmart and Target's new minimum wage levels exceed the state minimum wage in all but three states, according to a research note from financial services firm BTIG.

In RSM's 2017 survey of middle-market executives from across industries, 42 percent of respondents said they struggled to fill unskilled positions, and more than half said they were offering higher pay to attract such workers.

It's true that nothing recedes like success, and there's more work to do on the tax code.

Corporations won big with the GOP tax plan, and should have more money to invest in workers. Around three-quarters of that comes from the United States, which suggests a tax savings of $2.1 billion.

Walmart workers can also expect a new benefit to assist with adoption expenses, up to $5,000 per child.

Walmart, which reported annual revenue of almost $486 billion in the previous fiscal year, said the wage increases will cost it an additional $300 million in the next fiscal year. Ninety percent of Americans live within 10 miles of Walmart's 4,700 US stores, which sell everything from food and clothes to electronics and sports gear.

Other employees received far better news on Thursday. Before, full-time hourly workers received 50 percent of their pay for leave. Currently, Walmart employees are paid $9 an hour until they complete a training program, and then their wages are increased to $10 and hour. The retailer has spent about $2.7 billion to increase wages over the past few years, which has helped in improving customer service and keeping its stores clean. Both hourly and salaried employees will also get six weeks of paid parental leave.

Every Sam's Club store employs about 150 workers, bringing the total number of affected jobs to about 7,500, the person said. The amount, between $200 and $1,000, depends on how long they worked at the company. Put another way, the raise is equivalent to just 0.3 percent of the company's sales and administration costs.


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