Walmart Inc.’s promise to raise its average hourly wage to more than $ 15 comes amid a debate in Washington over whether to more than double the federal minimum wage.
The big retailer’s goal is politically significant because it aligns with President Biden’s proposal to raise the federal minimum wage to $ 15 an hour from the $ 7.25 an hour that has been in place for 11 years. It also comes from the country’s largest private employer, with stores located in different labor markets across the country.
But Walmart’s announcement on Thursday is not an endorsement of Biden’s plan, which is part of a $ 1.9 trillion Covid-19 relief proposal by Democrats in Congress that is expected to be approved by the House later this year. month. The company supports a higher federal minimum wage, but not $ 15 an hour. Although it plans to raise the wages of 425,000 hourly workers by an average of more than $ 14 in January 2020, its starting minimum wage would remain at $ 11 an hour.
Still, the change in the company may influence both sides of the federal debate over the minimum wage.
Democrats who support Biden’s salary plan may argue that Walmart’s salary increases are proof that employers can pay salary increases despite the pandemic’s economic turmoil, economists and analysts say. Republicans who oppose the doubling of the federal pay floor are likely to see this as an example of effective free market forces, arguing that the government does not need to intervene.