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Walmart Is Finally Raising Its Minimum Wage

by GilbertDarrow Posted on February 19, 2015

Mother Jones

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On Thursday, Walmart CEO Doug McMillon announced the company would be raising its baseline pay to at least $9 an hour beginning this spring and then up to $10 an hour by February 2016, a move that will affect an estimated 500,000 employees.

The decision, announced in both a press release and during a quarterly earnings call Thursday morning, follows years of mounting public pressure from both outside and within Walmart to boost its notoriously low wages and improve labor practices. The company has repeatedly responded to such criticism by pointing out that it pays more than the federal minimum wage, currently $7.25 per hour; of course, 29 states require a higher minimum wage. (An estimated 6,000 Walmart employees currently make the federal minimum.)

While McMillon described the move as a moral decision to do “the right thing,” Ohio University economics professor Richard Vedder said the move is more an indication of an improving economy than anything else.

“While the economy isn’t exactly booming right now, it is doing very well, with labor markets tightening and the unemployment rate continuing to fall,” Vedder said. “That means it’s becoming increasingly difficult for Walmart to attract good, dependable workers than it was two to three years ago. Right now, they are thinking the economy will continue to boom, and they need to stay competitive.”

“Could they afford to go further and still remain hugely profitable? Probably, but would that be good policy is another question,” Vedder added, referring to the reaction by Walmart stockholders today:

The nation’s largest private retailer, Walmart recently admitted that 825,000 of its 1.4 million employees earn only $25,000 annually, with 600,000 part-time workers on Medicaid and other food assistance programs. Walmart employees have staged strikes protesting their low wages, with advocacy groups demanding the retailer raise its minimum wage to $15. The company says that with the new increase, the average hourly wage will rise to $13 from $12.85.

While welcoming the move on Thursday, some say it is still not enough. “When compared to the $16 billion in profit that the company rakes in annually, Walmart’s promise of $10 an hour, which even for a full-time worker is not enough to keep a family of four out of poverty, is meager,” Christine Owens, director of the National Employment Law Project, told the New York Times.

A more substantial change could come from McMillon’s announcement, also on Thursday, pledging to bring scheduling enhancements for part-time workers currently struggling under unpredictable work hours. Last August, Starbucks announced the company would be improving scheduling policies to address such concerns.

“Walmart has been attacked over the years as being uncaring and tactless,” Vedder said. “This is a chance to win some points with the American public. By waging their raises they can appear more compassionate than previously viewed, especially when they aren’t put under the gun by federal law to do so.”

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Walmart Is Finally Raising Its Minimum Wage

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Walmart’s Surprise Wage Increase Might Be Good News About the Economy

by BlairArdill Posted on February 19, 2015

Mother Jones

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This is interesting news, especially in the wake of my earlier post about the dismal state of earnings growth in 2014. Walmart is raising wages:

The retail giant, which has been criticized for continuing to pay some employees the bare legal minimum, said that all of its United States workers would earn at least $9 an hour by April and $10 per hour by 2016. That would mean a raise for about 40 percent of its work force, to at least $1.75 above the federal minimum wage, the retailer said….Walmart’s move follows in the footsteps of retailers like Gap and Ikea, which both took steps last year to keep pay above federal minimum wage level, in an effort to lessen turnover and attract more lower-wage workers.

….In trying to address other major complaints from workers, Walmart said it would work to make scheduling easier and more predictable, and would also improve employee training.

Why is Walmart doing this? I hope Neil Irwin is right:

The best possible news would be if Walmart’s executives made this decision not out of a desire for good press or for a squishy sense of do-gooderism, but because coldhearted business strategy compelled it.

….The company’s sales and profits rose nicely between 2007 and 2014 while the company kept a lid on its payroll. Gains went to Walmart shareholders, not Walmart workers. So what has changed? The simple answer is that the world for employers is very different with a 5.7 percent unemployment rate (the January level) than it was five years ago, at 9.8 percent. Finding qualified workers is harder for employers now than it was then, and their workers are at risk of jumping ship if they don’t receive pay increases or other improvements. Apart from pay, Walmart executives said in their conference call with reporters that they were revising their employee scheduling policies so that workers could have more predictability in their work schedules and more easily get time off when they needed it, such as for a doctor’s appointment.

Megan McArdle highlights some recent changes in Walmart’s business strategy, such as a stronger focus on e-commerce, groceries, and better inventory control:

What a lot of these changes have in common is that you need good workers to execute them well. (Terrible things happen in the grocery business unless you have an absolutely passionate commitment to rooting out expired meat and past-it produce.) Keeping stock on the shelves doesn’t sound hard until you try to get resentful teenagers to actually do so. And so forth.

One way to get a more dedicated and experienced workforce is to pay workers more. They’ll stay longer, and they’ll be very eager to keep that job. Wal-Mart had clearly previously concluded that it didn’t need a dedicated and experienced workforce composed of people who were really eager to keep their jobs. Now the company seems to have changed its mind.

From any other retailer, this would just be an isolated bit of news. From Walmart, it’s potentially a big deal—thanks both to Walmart’s sheer size and its impact on other retailers. Maybe, just maybe, it’s a sign that the labor market really is starting to tighten.

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Walmart’s Surprise Wage Increase Might Be Good News About the Economy

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Target Officially Rejects Assault Weapons in Its Stores

by Latosha27M Posted on July 2, 2014

Mother Jones

A month after images first surfaced of pro-gun activists flaunting semiautomatic rifles at Target stores, the retailer has become the latest US company to officially reject firearms in its outlets.

“Our approach has always been to follow local laws, and of course, we will continue to do so,” Target said in a statement Wednesday. “But starting today we will also respectfully request that guests not bring firearms to Target—even in communities where it is permitted by law.”

The move follows weeks of pressure from Moms Demand Action for Gun Sense in America, which used social media, online petitions, and protests at Target stores to call for such a change.

Still reeling from its disastrous failure to secure customers’ personal data, Target leaders “were really nervous” after the gun issue emerged, a person with direct knowledge of the company’s discussions about it told me. “This was the last thing they needed.” Still, the company endured weeks of negative attention on the issue, even as Texas authorities and one of Target’s corporate strategic partners made clear that Target was trying to stop the guns from coming in.

Target joins a growing list of corporations—including Starbucks, Jack in the Box, Chipotle, Sonic, and Chili’s—that have reacted to demonstrations by open-carry activists by announcing that they don’t want people carrying guns on their premises.

Whether open-carry activists will comply with Target’s request appears to be an open question. One of the first to comment on Target’s posted statement was Kory Watkins—a leader of a Texas open-carry group that’s conducted provocative demonstrations, used disturbing intimidation tactics against women, and harassed a Marine veteran—who said he plans to pack heat at Target “today and tomorrow and whatever days I want.”

Carrying rifles on display in public is legal in Texas, although regulations governing Target’s sale of alcoholic beverages forbid guns on their premises, and armed patrons who don’t leave upon request could be subject to criminal trespassing charges, according to the Texas Alcoholic Beverage Commission.

For more of Mother Jones’ award-winning reporting on guns in America, see all of our latest coverage here, and our special reports.

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