Small business owners are not the only people thinking about changes to the minimum wage. A few major corporations have made the choice to voluntarily raise their compensation levels for their lowest-paid workers.
Since January, Walmart announced their commitment to pay minimum wage workers $9/hour beginning in April (up from the federal minimum wage of $7.25), with another increase to $10/hour planned for 2016. Shortly after, TJX, the parent company of TJ Maxx, Marshalls, and HomeGoods, announced their planned increase to $9/hour beginning in June, and then to $10/hour in 2016 for those employees inside the company for at least 6 months. This month, Target joined this group, announcing their planned increase to $9/hour beginning in April.
While these are the most recent corporations to increase worker compensation, they’re not the only ones. Ikea, Gap Inc., Costco, In-N-Out Burger, Shake Shack, Ben & Jerry’s, and Whole Foods have also all voluntarily raised their minimum wage levels.
Employee retention may be fueling this ripple effect. In an interview, Walmart’s CEO discussed the talent leakage they were experiencing as one of the motivating factors to increase their lowest wage level. Replacing employees costs companies about 16% of that salary, so the decision to invest in employees ends up saving the company money in the long-run. As more workers are earning more income, we’re all watching for what long-term impacts may become visible.
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