Wal-Mart is finally sharing a little bit of the pie with its hourly workers as more than 500,000 U.S. Wal-Mart and Sam’s Club employees will be receiving a pay raise soon. In a letter to associates posted on the Wal-Mart blog on Thursday, President and CEO Doug McMillon announced that as of the 1st of April, all of Wal-Mart’s full and part-time U.S. employees will earn at least $9.00 an hour, $1.75 more than the current federal minimum wage. In an early (hopefully) sign of wage inflation pressures, McMillon noted that at the country’s largest employer outside the military, associates wages will increase to at least $10.00 an hour a year from now.
McMillon also emphasized today’s announcement is not just about pay raises, it’s about a new approach to jobs at Wal-Mart. “Today, we’re announcing a package of changes in Wal-Mart U.S. that will kick off a new approach to our jobs. We’re pursuing comprehensive changes to our hiring, training, compensation, and scheduling programs, as well as to our store structure, and these changes will be sustainable over the long term.”
Relying On Old-Fashioned Stock Picking, Lee Ainslie Reports His “Strongest Quarter” Ever
Lee Ainslie's Maverick Fund USA enjoyed its "strongest quarter in the fund's history" during the three months to the end of June. According to a copy of the firm's second-quarter letter to investors, which ValueWalk has been able to review, Maverick Fund USA gained 18% in the second quarter. Following this performance, the fund was Read More
Details on the Wal-Mart pay raises
Opportunity for both current and employees was McMillon’s theme in a CNBC interview Thursday. “Today’s cashier is tomorrow’s store manager. Tomorrow’s store manager may have my job, so we want to make sure that opportunity is there for people, as it has been for so many of us in the past,”
The mega-retailer noted spending on wage and training initiatives, as well as investments in e-commerce, added up to around 26 to 29 cents per share.
Wal-Mart also offering higher starting wages and higher manager pay
The letter to associates announcing the pay raises also noted that future associates will be able to join Wal-Mart at $9 an hour or more next year, then receive “skills-based training for six months” and be guaranteed at least $10 an hour after completing the training. The letter also highlighted some changes in the roles and responsibilities of department managers, as well as raising the starting wage for most of these jobs to at least $13 an hour by summer and at least $15 an hour in early 2016.
On the conference call, Wal-Mart CEO McMillon stated:
Approximately 500,000 full-time and part-time associates at Walmart US stores and Sam’s Club’s will receive pay raises in the first half of the current fiscal year. Current and future associates will benefit from this initiative which ensures that Walmart hourly associates earn at least $1.75 above today’s federal minimum wage or $9.00 per hour in April. The following year by February 1, 2016, current associates will earn at least $10 per hour.
We are also realigning our store operational structure to give associates a closer relationship with their supervisors. Associates will have more ownership over their schedules. In addition, we will provide them with more resources and training to enable merit-based career advancement and higher levels of pay. Of course, for a number of years associates have had the opportunity for competitive healthcare and 401(k) benefits as well as access to bonus incentive opportunities, discounts and educational programs. These programs will continue to be available to current and future associates.
We are also launching an innovative program for future associates that will allow them to join Walmart at $9.00 per hour or more, receive skills-based training for six months, and then be guaranteed at least $10 per hour upon successful completion of that program.
Sam Walton used to say that our people make the difference. I share this same philosophy. Overall, these are strategic investments in our people to reignite the sense of ownership they have in our stores.