Wal-Mart is giving raises to the vast majority of its U.S. employees as part of the world's largest retailer's previously announced investment in its workforce. The move comes as it seeks to hold onto workers in an increasingly competitive market.
Wal-Mart Stores Inc. on Wednesday said more than 1.2 million U.S. hourly workers will
Last February, Wal-Mart announced that it would raise base employee wages for 500,000 workers to $9 an hour last year, with plans to move it to $10 per hour, next month. The company also said new entry level workers hired after Jan. 1, 2016 would start at $9 per hour, but move to at least $10 an hour after completing a six-month training program. Then last June, Wal-Mart said it would raise starting wages for more than 100,000 U.S. department managers.
In total, Wal-Mart's CEO Doug McMillon said in October that last year's investment in wage increases, along with improved training, cost $1.2 billion. McMillon also said the company expects to pump $1.5 billion in to its workforce this year, although at the time he did not give details.
Wal-Mart has maintained that if it keeps its workers happy, they will serve customers better. That will lead to higher sales. Retaining and attracting workers is critical as a stronger labor market increasingly offers workers more opportunities to jump around/
"The competition for talent is strong," said Craig Rowley, global leader of consultancy Hay Group's retail practice. "It's strong because there are fewer people to hire."What a unique idea - the market forcing an employer to pay more to retain employees who have options to work elsewhere.
Of course, liberals like to cite the example of Costco allegedly paying its hourly employees an average of $20.89 an hour, before counting overtime or benefits. The claim was made by the Costco CEO, W. Craig Jeline, a major contributor to President Obama re-election campaign. In speeches, Obama has cited the Costco $20.89 an hour claim as proof as to what corporations can do if they want to.
Costco CEO Craig Jelinek Leads the Cheapest, Happiest Company in the World" in which the author contrasts the $20.89 an hour Costco allegedly pays its employees to Wal-Mart's then average of $12.67 for full-time hourly employees.
Fortunately, there is a website, Glassdoor.com, which allows employees to self-report their pay. As I noted in an article I wrote in February 2015, the thousands of Costco employees who report their pay on the website show them making nowhere near the $20.89 average claimed by Jelinek. From the reporting, the $20.89 an hour claim seems to be a top salary for unskilled hourly workers, certaiunly not an average. It does appear Costco pays its employees substantially better than Wal-Mart, but the difference is likely much, much closer to $3 an hour rather than the $8 an hour based on the $20.89 claim.
I have also talked personally to Costco employees, none of whom confirmed the $20.89 an hour claim. Occasionally, I still get comments on the February 2015 article, including some from people who claim to work there. (I haven't figured out how to shut them off and would like to since I'm tired of monitoring them.) Two people who claim to be Costco employees recently wrote in to dispute my assertion the $20.89 an hour claim was phony;one noted that he made $14.50 an hour at Costco after four years while the other one said "top pay" at Costco is $20.89 an hour. Those comments don't begin to support the $20.89 an hour AVERAGE pay claim made by Jelinek, The other day, I received a comment who I think tells it straight about employment at Costco:
I have worked at Costco for five years now. I make just over 15$ an hour. I also drive a forklift in the evening, so I get an extra .25 an hour for the last two hours of my shift. I have decent benefits, that are great when you are first starting out at Costco in a part-time capacity and have a wife and children to take care of. I also have a fair amount of vacation and sick time, also handy with kids, though I manage to burn through it more quickly than I earn it. Kids get sick after all. Also, there is a limit throughout the year as to how many times you can use your sick time, regardless of how many times you need to use it to take care of your kids. I have been written up in the past and threatened with suspensions, what ever, my kids are sick I'm going to take care of them. As far as the raises and bonuses go, those are measured strictly through hours worked and have nothing at all to do with work ethic (which in my personal opinion breeds lazy, overpaid employees). So, regardless of how hard I work, at this time I have over 700 hours before my next raise. Since it's January which begins the slow season, Costco slashes its hours regardless of the needs of its employees, I'm getting between 24 and 28 hours a week right now. I have another 1700+ hours until I will receive my first bonus check. 1700 hours at 24 hours a week...
As far as a cost of living adjustment is concerned, I have never heard of that taking place, and I have never received any such thing within my 5 years of employment. I am however pressured to donate a portion of my pay check towards the employee club and united way 1-2 times a year, regardless of the fact my family already donates time and makes donations towards other charities of our choosing, but my personal charity isn't reflected in Costcos numbers, so they really appreciate it when we as employees can help out. Numbers, that's what I believe it comes down to at Costco. Big numbers, which they have. They have a lot of employees, many of which like working there, because they're skill sets and poor work ethics would never allow them the opportunity to slowly slug their way to 20+ an hour anywhere else. Is Costco a bad company to work for? No, I've worked for worse. However, I've also worked for much, much better. Companies that wanted you to succeed as an individual, companies that gave you the tools and guidance to do so. That's what gets to me, so many people talk as if Costco is one of the best companies out there. It's just another corporate conglomerate that's trying to make money. It's not trying to better the world or be the best company to work for if you have a strong work ethic and vision. Am I going to quit anytime soon? No, I need the money, I need the benefits... at least until I manage to get through school. Then I will leave. So, if you just got out of high school or recently dropped out of college and have no real drive to succeed at life and just want to skim buy for the next 20+years, yes... Costco is probably a pretty good fit for you. However, if you want more out of life than just some 20$ an hour carrot being waved around in your face, you may want to take into consideration the possibility that the "Costco is the best retail place to work" perception may be more of an Urban Legend than fact. Anyways, like Costco, don't like Costco... It's a multi-billion dollar, international company that opens up plenty of new stores all over the world every year... It's not going any where or changing it's business practices anytime soon.