Walmart Raises Minimum Wage as Retail Job Market Remains Tight

walmart said on Tuesday that it is raising the minimum wage for store employees to $14 an hour, representing a jump of about 17% for workers who keep shelves and serve customers.

From the beginning of March, store employees will earn between $14 and $19 an hour. According to Walmart spokeswoman Anne Hatfield, they currently make between $12 and $18 an hour.

Following the move, the average U.S. retailer wage is expected to top $17.50, Walmart U.S. CEO John Ferner said Tuesday in a memo to employees.

Around 340,000 store employees will be promoted due to the move, Hatfield said. This equates to a pay increase for approximately 21% of Walmart’s 1.6 million employees.

The retail giant, which is the largest private employer in the country, is raising salaries at an interesting time. Some economists are calling for a recession. Prominent technology companies, media organizations and banks, including Google, Amazon and Goldman Sachs, fired thousands of employees and sounded the alarm. Weaker sales trends prompted retailers, including Macy and Lululemonto recently warn investors of a tougher year ahead.

But so far, retailers have largely avoided job cuts. Instead, they are still struggling with a tough job market.

Retail, compared to other industries, tends to have higher employee turnover than other industries, which allows employers to manage their workforce by slowing job fills, said Gregory Dako, chief economist at EY Parthenon, Ernst & Young’s global business unit. strategic consulting.

However, he said retailers can also plan with caution. Over the past 18 months, they have had to work harder to hire and retain employees. If they lose too many employees, he says, hiring and training new employees can be expensive.

“Any retailer will have to think carefully and twice before laying off a significant portion of their workforce,” he said.

In a Walmart staff memo, Ferner said the pay increase would be part of many employees’ annual raises. The company said a portion of these pay increases will also go to store employees who work in parts of the country where the job market is more competitive.

Walmart sweetens other perks to attract and retain employees. Ferner said the company is adding more college degrees and certificates to its Live Better U program, which covers tuition and pay for part-time and full-time workers. It is also creating more high-paying positions in its auto services and recruiting employees to work as truck drivers, jobs that can bring in up to $110,000 in the first year.

This story is evolving. Please stay tuned for updates.