Workers in Target’s stores and distribution centers in places like New York, where competition for recruitment and hiring is fiercest, can earn starting salaries of up to $ 24 an hour this year.
The Minneapolis-based retailer said on Monday it would accept minimum wages ranging from $ 15 to $ 24 an hour, with the highest pay being hired in the most competitive markets. He currently pays a universal starting salary of $ 15 per hour.
The new starting salary range is part of the company’s plan to spend an additional $ 300 million on its workforce this year, which will also include wider and faster access to health care for its part-time workers.
“The market has changed,” Target CEO Brian Cornell told the Associated Press. “We want to continue to be a leader in the industry.”
Target set a new marker for the retail industry back in 2017 when it announced it would increase hourly wages to $ 15 by 2020. But US labor market dynamics changed during the pandemic, with many employers facing a sharp shortage of workers. And many of Target’s rivals now pay a minimum of $ 15 an hour or more.
Target, which has about 1,900 stores and 350,000 employees in the United States, noted that its turnover is now actually lower than before the pandemic. The retailer also said it had exceeded its target of hiring 100,000 seasonal workers in its stores and 30,000 in the nationwide supply chain during the 2021 holiday season – big companies looking to lure workers during the 2021 holiday season, do whatever they could bring candidates. Amazon, Walmart and Macy’s were among the many offerings unprecedented salaries and signing bonuseshealth benefits and even reimbursement of training costs.
But Target realized that there needed to be an even more localized approach to wages. He said he was still doing his analysis and declined to name the areas that would receive the highest starting salaries.
When Target first announced in 2017 that it would pay $ 15 an hour by 2020, it was one of the first major retailers to do so. But during the pandemic, a number of rivals such as Best Buy followed suit, some surpassing Target. Costco raised its minimum hourly wage for workers from $ 16 to $ 17 last fall. Amazon’s starting salary is $ 15 per hour, and the average national starting salary of the e-commerce giant for transport and performance jobs is $ 18 per hour.
Craft chain Hobby Lobby on January 1stincrease the hourly wage of full-time workers to $ 18.50 per hour for full-time workers from January 1. The 49-year-old raised its full-time minimum hourly wage to $ 17 in October 2020, earning part-time workers $ 13.
Last fall, Walmart raised its minimum wage to $ 12, from the $ 11 hourly base it established in 2018. The company also raised hourly wages for more than 565,000 employees in the store by at least a dollar.
Labor shortages continue
Many retailers say they are struggling to find workers. According to a recent survey of more than 100 large retailers with annual revenues of between $ 500 million and more than $ 20 billion, 96% say they have trouble finding employees in the store. A survey conducted by global consulting firm Korn Ferry in January also found that 88% said it was difficult to find workers at the distribution center.
This demand for workers is constantly raising wages, especially for lower-income workers. According to the Federal Reserve Bank of Atlanta, wages among the poorest a quarter of workers jumped 5.8 percent in January from a year ago. That’s twice the profit for the highest-paid quarter.
In January, the average wage of retail workers, excluding managers, jumped 7.1 percent from a year earlier to $ 19.24 an hour. This is faster than the profits before the pandemic. In January 2020, the wages of retail workers increased by 4.2% compared to the previous year. In January 2017, it increased by only 1.7% compared to the previous year.