(Reuters) – Walmart (WMT.N) on Tuesday will raise average hourly wages for its U.S. store workers starting next month in a bid to attract and retain workers amid a tight domestic labor market. announced.
Walmart’s new pay hike will lift the average hourly wage to $17.50 from the current $17, and will be reflected in salaries on March 2, the company said. About 340,000 employees in about 3,000 stores are eligible, a spokesperson said in an email, saying he would raise the minimum wage for U.S. store employees by $2, to a range of $14-$19 an hour depending on location. and added that
Walmart employs 1.6 million American workers, most of whom work in rural and semi-urban areas.
But it will offer rivals like Amazon (AMZN.O), Costco (COST.O) and Target (TGT.N) a minimum wage of $15 an hour starting in 2021.
Walmart’s move comes amid slowing U.S. wage growth. Data from earlier this month showed that average hourly wage growth for U.S. workers slowed to 0.3% in December, compared with his 0.4% the previous month.
Still, the labor market is resilient, with the unemployment rate dropping to a 50-year low of 3.5% in December, with vacancies far outstripping unemployment.
This raises the possibility that the US Federal Reserve may raise interest rates even further, putting further strain on minimum wage workers and household budgets.
The pay increases are a combination of regular annual pay increases and targeted investments in starting salaries, the company said in a statement Tuesday.
Walmart’s new hike comes six months after it raised average pharmacy workers’ wages to more than $20 an hour and is part of a new “progressive wage model” to address labor shortages. It said it would offer more frequent and automatic raises. The company has also previously raised salaries for truck drivers and distribution center workers.
Reported by Siddharth Cavale, New York and Uday Sampath, Bangalore. Editing by Devika Syamnath and David Gregorio
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