- Companies like Kroger and Amazon are attacking rivals like Walmart for employee wages.
- Walmart said this week that it will raise wages for many workers, but does not pay a minimum wage of $ 15.
- Amazon, Costco and Target pay workers at least $ 15 an hour.
- Visit the Insider Business section for more stories.
Major retailers have remained silent about imminent increases in the minimum wage.
But they have more to say when it comes to shooting the competition.
When Walmart announced on Thursday that it was raising wages for some workers, rival supermarket chain Kroger was quick to respond.
“We welcome Walmart’s announcement to raise its average wage to $ 15 an hour,” a company representative told Insider. “At Kroger, our average hourly wage has been $ 15 an hour since 2019.”
“In fact, our average hourly membership fee amounts to more than $ 20 an hour when counting health, 401 (K) and pensions that many of our competitors choose not to offer,” added the spokesman.
Attacking Walmart is becoming a bit of a tradition in the retail sector. In December, Amazon decided to take a swing at Walmart when Bloomberg reported that opening an Amazon warehouse decreased the industry’s average pay in a county.
“What surprises us is that we are the focus of a story like this, when some of the country’s largest employers, including the largest retailer, have not yet joined us in raising the minimum wage to $ 15,” Amazon said in a statement to Bloomberg in The Hour.
Retailers criticizing each other is no surprise
Amazon pays $ 15 an hour to all warehouse workers.
Noah Berger / Reuters
With a $ 15 minimum wage already deployed in many states and cities, some companies are spending less time fighting new federal regulations and more time fighting each other.
“Generally, I think most retailers prefer wages to be left to the market rather than legislated,” Neil Saunders, director of GlobalData, told Insider.
“However, many retailers have voluntarily increased wages in recent years, so an increase to $ 15 is now not seen as a big deal by some,” continued Saunders. “In fact, many have increased or are in the process of delivering on promises to raise wages to $ 15.”
Higher wages for basic positions, as well as better benefits and other advantages, usually mean that companies can hire more engaged workers, less likely to quit. Retailers raise workers’ wages because of regulation, but also to compete better with rivals.
“One of the challenges for any retailer is turnover,” Moody’s analyst Charlie O’Shea told Insider in October.
“Amazon has very liberal benefit programs, even for part-time employees,” added O’Shea. “Walmart covered the college. There are all kinds of bells and whistles that retailers at the top of the food chain can make because they have the money for it.”
The sector’s internal struggle can also help companies to differentiate themselves from competitors. With Walmart, Kroger and Amazon going through a huge wave of hiring in 2020, having a reputation as a good place to work can help attract talent to stores and warehouses.
Who really has the highest minimum wage?
Costco was one of the first national retailers to pay all workers at least $ 15 an hour.
Tim Boyle / Getty Images
Some large companies pay all workers at least $ 15, while others offer a broader range. Here’s how some of the biggest players rate themselves.
Walmart minimum wage: $ 11 an hour
On Thursday, Walmart announced that on March 13 it will launch a raise that raises the salary of 425,000 members between $ 13 and $ 19 an hour. As a result, the average wage for nearly half of hourly workers in the U.S. will reach $ 15 an hour, according to a Walmart representative.
All Walmart warehouse employees earn at least $ 15 an hour. At this point, Walmart’s minimum wage will remain at $ 11 an hour.
“These people for whom we are raising salaries tend to be with us longer than someone who may be earning the starting salary,” said CEO Doug McMillon in an investor call this week. “We are trying to … create this ladder of opportunities, offering an opportunity for people, when they start at the company, to build a career like many of us already have.”
Costco minimum wage: $ 15 per hour
Costco increased its minimum wage to $ 15 in 2019. At the same time, the company increased the pay for supervisors and introduced the paid guarantee leave for all hourly employees.
The retailer has been celebrated by many workers as one of the best companies to work for in the industry.
“The best part is all the benefits – guaranteed hours, benefits, time and a half on Sundays, free turkeys on Thanksgiving Day, four free memberships, a living wage,” an employee with six years of experience told Insider in 2018 .
Desired minimum wage: $ 15 per hour
In June, Target raised its minimum wage to $ 15 from $ 13. The increase was part of a multi-year effort, with the company promising in 2017 that it would reach a minimum wage of $ 15 an hour by the end of 2020.
“Everything we aspire to do and be as a company is based on the central role that our team members play in our strategy, their dedication to our purpose and the connection they create with our guests and communities,” said Target’s CEO , Brian Cornell, in a statement.
Kroger minimum wage: varies by region
Although Kroger says his average hourly wage has been $ 15 since 2019, some workers earn less than that. The initial payment varies by region and position.
“Since the beginning of the pandemic, Kroger has proudly invested more than $ 1.5 billion to protect and reward our associates and has committed nearly $ 1 billion to guarantee pensions for tens of thousands of our associates across the country,” said a representative. in a statement.
Kroger has also faced negative reactions recently for closing stores in Seattle and California due to the “hero pay” regulation, which would have temporarily increased workers’ wages by $ 4 an hour.
“The biggest problem for many now is dealing with local laws requiring temporary increases and bonuses in paying heroes,” said Saunders. “This is causing a lot of problems and a patchwork of different salary structures. Many of the rules are illogical and difficult to implement.”
Amazon minimum wage: $ 15 per hour
Amazon raised its minimum wage to $ 15 an hour in 2018.
“At Amazon, we believe that $ 15 an hour is the minimum that anyone should be paid in the United States for an hour of work,” Amazon said in a statement to Insider on Friday. “That’s why, since 2018, every Amazon employee has earned a starting hourly wage of at least $ 15.”
“This is also why we are asking Congress to raise the federal minimum wage to $ 15 an hour and urge other large corporations to raise wages to that level,” the statement continued. “We are pleased that several companies have taken this important step – which will help workers and their families, communities and our economy in general – and we hope that more will do the same.”