Walmart and minimum wage
An on-going discussion within the United States’ economy is the issue of minimum wage. Those in support of raising minimum wage made strides in 2014 when it was determined that an increase will be made in nearly half of the States in 2015. This forced the nation’s largest retailer, Walmart, to reevaluate how they are paying their employees.
During the new year, the lowest paid employees working in over 30 percent of Walmart’s stores are reportedly in for an increase in pay. After the first of the year almost half of the nation’s states and Washington D.C. are looking at a raise in minimum wage.
It was explained that Walmart informed their store managers that there will be wage adjustments within the store due to the raise in local pay. Reuters reported that there will be a shrink in the wage gap between Walmart’s lowest paid employees and their highest paid employees. The three lowest paying jobs in the Walmart corporation, maintenance, cart-pushers, and cashiers, will consolidate to the same pay rate.
Traditionally jobs are cut, will that happen again?
Unions and labor advocates have criticized Walmart over the years, claiming that the company underpays over one million of their employees. This is due to the fact that most of their employees are labeled as part-time while their full-time staff make $12.92/hour. Walmart has been found to cut many employee hours in order for said employees to be classified as part-time so they will only have to be paid minimum wage. In addition, the company recently eliminated insurance benefits of 30,000 part time workers.
Walmart CEO Doug McMillon stated that only some 6,000 employees make the federal minimum wage of $7.25. This statement has also been criticized because over the last few years, 18 states have already increased their minimum wages while most states will be over the $7.25 this year.
In years past, Walmart has been seen to support increases in federal minimum wage and they will continue to do so with the new implementation of President Obama’s proposal of $10.10/hour. And because there will be a circle of spending (increases in federal minimum wage means an increase in consumer spending at Walmart stores) there is no mention of job cuts due to wage increases.