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Walmart Raises Wages to $9 an hour for 40 Percent of Its Employees

The retail giant will increase it’s starting pay for U.S. associates to $1.75 over federal minimum wage

Photo via Wikimedia Commons

Walmart is often cited as the epitome of corporate greed, known for underpaying workers and slashing healthcare benefits in the name of maximizing profits. However, Walmart, the largest private employer in the United States, has redeemed itself slightly in the eyes of some of its critics by announcing Thursday that starting in April it will raise employee pay to $9 an hour for its lowest paid U.S. workers—that’s $1.75 above the federal minimum wage.


By February 2016, the lowest wage for its U.S. employees will be $10 an hour. About 500,000 employees, roughly 40 percent of the company, will stand to benefit from these pay increases. Across the board, due to related raises and adjusted compensation ranges, Walmart’s average hourly wage for full-time workers will increase from $12.85 to $13 an hour and the average for part-time workers will increase from $9.48 to $10 an hour, according to the BBC. Th retail giant also announced a six-month, skills-based training program for new employees that would guarantee them, upon completion of the program, pay of $10 an hour, according to the Los Angeles Times. (No word on whether this incentive will continue when California’s minimum wage rises to $10 an hour in 2016). Walmart’s hope is that by “investing in people” this new training program and higher wages will help employees advance in the company and reduce the amount of turnover, which is estimated to be as high as 70 percent.

Walmart estimates it will spend $1 billion in the fiscal year to fund this new program and raise employee wages. The motives behind this are up for debate: some blast Walmart, saying that their decision is purely business rather than accepting corporate responsibility for the welfare of its workers, while others applaud the company for outpacing the gridlock in Washington regarding raising the minimum wage.

OUR Walmart, an organization of employees backed by various labor unions, have held one-day strikes over the last two years to demand a $15 an hour “living wage” and more autonomy in scheduling. Emily Wells, a Walmart worker and member of OUR Walmart, sees this policy change as a victory for the organization but wants to see progress continue.

“With $16 billion in profits and $150 billion in wealth for the owners, Walmart can afford to provide the good jobs that Americans need—and that means $15 an hour, full-time, consistent hours and respect for our hard work,” Wells told the Guardian.

One thing’s clear: Walmart, and other companies, including Ikea, Gap, and Aetna, increasing employee wages is a good sign for the U.S. economy.

“So even though some businesses have to pay their workers more, they see more customers coming through the door because now there’s additional dollars rippling out through local economies in a way that doesn’t really happen if those dollars just go back into the bank accounts of corporate shareholders,” David Cooper, an economic analyst at the Economic Policy Institute, told the Guardian.