Walmart bumps up hourly pay by $1 for more than 500K workers

Dive Brief:

As retailers battle for labor ahead of the hectic holiday shopping season, Walmart is raising hourly wages for 565,000 associates by at least $1.
Walmart U.S. President and CEO John Furner told associates in a memo obtained by Retail Dive that workers in front-end, food and consumable, and general merchandise work groups will get the pay raise effective Sept. 25. The average hourly pay for the company's U.S. associates is now $16.40.
Walmart's minimum wage will be up from the $11 per hour rate it set previously. As of last year, deli, bakery and some auto workers start at $15 per hour. The recent announcement marks Walmart's third wage investment for store associates in the past year, Furner said.

Dive Insight:

Though it is typical for retailers to hire thousands of seasonal workers ahead the holidays, Walmart's announcement signals the competitiveness of this year's tight labor market. It also indicates the lengths retailers are willing to go to lure candidates.

Walgreens Boots Alliance said on Tuesday that it plans to increase the starting hourly wage for all team members to $15 to be fully implemented by November. CVS also recently announced a pay bump to $15 an hour for its workers effective July 2022. Meanwhile, Costco surpassed competitors in March with a $16 per hour minimum wage.

Other retailers like Target and Amazon have also ramped up wages for employees in the past. Target and Walmart also debuted employer-sponsored debt-free degree programs for workers who want to pursue higher education. Over the past year alone, Walmart has increased the wages of about 1.2 million hourly workers, according to the memo.

The federal minimum wage is $7.25 per hour, but the pandemic-driven labor shortage might work in favor of laborers as retailers announce more benefits to hook them in.

Walmart also announced this week plans to hire 20,000 permanent part-time and full-time supply chain workers across over 250 Walmart and Sam's Club distribution centers, fulfillment centers and transportation offices in preparation for holiday demand.