Walmart Increases Pay Wage For Select Employees After Earnings Drop, Predicts Sale Growth

Around 425,000 Walmart workers across the U.S. will be receiving a raise above $15 an hour starting next month. On Thursday, the company announced its plans to give its employees working in digital and stocking groups the pay increase, USA Today reports.

Employees holding those select positions will see an increase in starting pay from $13 to $19 an hour, depending on their store locations. Walmart employs around 1.5 million people in over 5,000 stores in the U.S.

Doug McMillon, the CEO of Walmart, said that the company has increased the starting wage for its employees by more than 50% since 2015.

“These are investments in people that are important to our future because they provide a great pickup, delivery, and in-store experience for our customers,” McMillon told analysts during a presentation.

However, Harry Holzer, a Georgetown University professor who studies minimum wage, told CNN that Walmart may have increased the pay of its employees “to stay ahead of the curve, and not fall much behind other retailers” that have given workers raises and states that have increased minimum wage.

News of the pay raise comes as Walmart's fourth-quarter earnings fell short of Wall Street’s expectations. As a result, its shares fell 5% in premarket trading on Thursday, CNBC reports.

However, following an unprecedented year that saw a lack of availability for in-demand household staples, Walmart expects earnings to increase in 2021. The company announced plans on Thursday to invest almost $14 billion toward improving distribution and increasing automation.

Over the past year, Walmart and Sam’s Club have been giving pay bonuses to employees for their work throughout the coronavirus pandemic. In September, Walmart announced that around 165,000 workers would be receiving raises after the company introduced new leadership roles and “cross-training opportunities.”

Aside from the changes for the employees holding digital and stock positions, the minimum wage at Walmart will remain at $11 an hour. Since 2009, the federal minimum wage has been $7.25 an hour.