Walmart Inc. (NYSE:WMT) is raising the minimum wage for its employees, even as the COVID-19 pandemic continues to take a toll on the traditional retail landscape. A good number of brick and mortar are struggling to stay afloat as the epidemic continues to disrupt shopping patterns. Amid the COVID-19 shocks, the nation’s largest retailer believes it is high time it matched what its biggest rivals Amazon.com, Inc. (NASDAQ: AMZN) and Target Corporation (NYSE: TGT) are paying their staff.
Walmart Pay Hikes
The retailer has confirmed that about 165,000 employees are scheduled to get a pay hike on the minimum wage, increasing from $11 to $15. Hourly team leaders will earn between $18 and $21 an hour. The pay could reach highs of $30 an hour in some instances. Salaried digital and asset protection personnel will also enjoy new pay perks as part of the structural changes. The hike will also affect auto center employees expected to get a raise of at least $1 an hour.
The new pay structure will come into effect in October. Likewise, it will replace the annual increase pay structure that saw Walmart increase the pay of employees in February or April of every year. In addition to the new pay structures, employees will no longer be entitled to quarterly bonuses that mostly affected hourly employees. Walmart has already paid close to $1 billion in bonuses amid the Covid-19 pandemic.
The pay hikes will come with increased responsibility for staffers. For instance, leaders of small team sin supercenters will have to ensure the store is always in stock while also meeting various visual standards. The pay hike comes in the aftermath of Walmart, trying a new organizational structure at the Walmart Neighborhood Markets.
Walmart expects the new pay structure to create room for pay and career growth as it continues to invest on pickup and delivery. The retailer has increased its investment and focus on e-commerce as it continues to respond to changes in the retail sector that has seen customers resort to online shopping.
Focus On e-Commerce
While focusing on e-commerce, the retailer will now be able to compete against Amazon, which has taken the retail sector by storm on becoming the go-to place for online shopping. Target is another retailer that is also increasing its presence on e-commerce in response to the changing consumer shopping patterns.
Target has already raised the minimum wage of staff to $15, also matching Amazon’s starting pay for full-time, part-time, and distribution center employees. Kroger is another retailer inching closer to raising the minimum pay in its stores after completing negotiations with the United Food and Commercial Workers Union.
Walmart, just like other retailers, has been under immense pressure in recent years, from trade unions, to increase the minimum hourly rate in response to an increase in the cost of living. While some retailers have hiked the minimum wage, some have struggled to implement new structures. The Covid-19 epidemic has all but complicated the matter, with most businesses struggling to stay afloat.