Wal-Mart Stores, Inc. (NYSE:WMT), the largest retailer worldwide, has been hiring temporary workers in many of its stores in the United States in recent months. The retail giant generally hires many temporary workers during the holiday season.
Dhanya Skariachan and Jessica Wohl of Reuters cited that it’s the first time for the company to practice the temporary hiring strategy outside the holiday season. Based on a survey conducted by Reuters on 52 stores operated by Wal-Mart Stores, Inc. (NYSE:WMT) in the country, 27 stores were hiring temporary workers only and 20 stores were hiring part-time, regular, and temporary workers. Five stores were not hiring any employees.
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Wal-Mart’s New Hiring Policy
According to David Tovar, spokesperson for Wal-Mart Stores, Inc. (NYSE:WMT), the company’s new hiring policy ensures that its stores have appropriate staffs particularly during the busiest days, and it not a cost cutting move. He emphasized that temporary workers are paid with the same starting pay as other workers.
The spokesperson added that less that 10 percent of its current workforce of Wal-Mart Stores, Inc. (NYSE:WMT) in the United States is temporary or “flexible associates” and the majority are still regular, full-time employees.
Bill Simon, chief executive of Wal-Mart U.S., confirmed that the retail giant is hiring more temporary workers. He explained, “Their hours flex by the needs of the business from time to time.”
The new hiring policy of Wal-Mart Stores, Inc. (NYSE:WMT) helps reduce its labor costs as the company still experiences margin pressure due to slow economic growth. Many consumers are still struggling and purchase everyday goods with little pricing power. The competition among big box discount chains, dollar stores, and grocery stores is strong.
Industry experts and retail strategists opine that the retail giant could set an example for other companies finding ways to cushion their businesses from a potential increase in healthcare costs due to Obama Care.
The spokesperson of the Wal-Mart Stores, Inc. (NYSE:WMT) pointed out that the new hiring policy of the company is not related to the health care reforms of the government. He acknowledged that it would take years for temporary workers to receive healthcare benefits. The company hires temporary workers on a 180 day contract.
The actual number of the workforce of the retail giant remains relatively flat despite opening more stores in the previous years. Wal-Mart Stores, Inc. (NYSE:WMT) had more than 1.3 million employees at 4,005 stores in the United States by the end of its fiscal 2013 compared with approximately 1.4 million workers at 3,656 stores in 2009.