- Companies including Kroger and Amazon are taking shots at rivals like Walmart over employee pay.
- Walmart said this week that it will raise many workers’ wages, but does not pay a $US15 ($19) minimum wage.
- Amazon, Costco, and Target all pay workers at least $US15 ($19) per hour.
- Visit the Business section of Insider for more stories.
Massive retailers have stayed mostly quiet about looming minimum wage increases.
But they have more to say when it comes to taking shots at the competition.
When Walmart announced on Thursday it was raising some workers’ wages, rival grocery chain Kroger was quick to have a response.
“We welcome Walmart’s announcement to bring their average wage up to $US15 ($19) an hour,” a company representative told Insider. “At Kroger, our average hourly wage has been $US15 ($19) an hour since 2019.”
“In fact, our average hourly associate rate reaches over $US20 ($25) an hour when accounting for healthcare, 401(K) and pensions that so many of our competitors choose not to offer,” the spokesperson added.
Sniping at Walmart is becoming a bit of a tradition in the retail industry. In December, Amazon decided to take a swing at Walmart when Bloomberg reported that an Amazon warehouse opening drove down a county’s average industry compensation.
“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 yet to join us in raising the minimum wage to $US15 ($19),” Amazon said in a statement to Bloomberg at the time.
Retailers sniping at each other comes as no surprise
With a $US15 ($19) minimum wage already rolling out in many states and cities, some companies are spending less time fighting new federal regulation and more time fighting each other.
“Generally, I think most retailers would prefer wages to be left up to the market rather than legislated for,” GlobalData managing director Neil Saunders told Insider.
“However, a lot of retailers have been voluntarily increasing wages over the past few years so an increase to $US15 ($19) is now not seen as such a big deal by some,” Saunders continued. “Indeed, many have raised, or are in the process of delivering on promises to raise, wages to $US15 ($19).”
Higher pay for entry-level positions, as well as better benefits and other perks, typically means companies can hire more engaged workers who are less likely to quit. Retailers raise workers’ pay because of regulation, but also to better compete with rivals.
“One of the challenges for any retailers is turnover,” Moody’s analyst Charlie O’Shea told Insider in October.
“Amazon has very liberal benefits programs, even for part time employees,” O’Shea added. “Walmart has got college covered. There’s all sorts of bells and whistles that the retailers at the top end of the food chain have been able to do because they can afford it.”
The industry in-fighting can also help companies distinguish themselves from competitors. With Walmart, Kroger, and Amazon all going on massive hiring sprees in 2020, having the reputation of being a good place to work can help attract talent to stores and warehouses.
Who actually has the highest minimum wage?
Some major companies actually pay all workers at least $US15 ($19), while others offer a wider range. Here is how some of the biggest players measures up.
Walmart minimum wage: $US11 ($14) per hour
On Thursday, Walmart announced that on March 13 it will roll out a raise that brings 425,000 associates’ pay to between $US13 ($17) and $US19 ($24) per hour. As a result, the average pay for nearly half of hourly workers in the US will reach $US15 ($19) per hour, according to a Walmart representative.
All warehouse workers at Walmart make at least $US15 ($19) per hour. At this point, Walmart’s minimum wage will remain at $US11 ($14) per hour.
“Those people that we’re raising wages for tend to have been with us for a longer period of time than someone that might be earning the entry wage,” CEO Doug McMillon said on a call with investors this week. “We’re trying to … create this ladder of opportunity, providing an opportunity for people when they start with the company to build a career like so many of us already have.”
Costco minimum wage: $US15 ($19) per hour
Costco raised its minimum wage to $US15 ($19) in 2019. At the same time, the company increased pay for supervisors and introduced paid bonding leave for all hourly employees.
The retailer has been celebrated by many workers as one of the best places to work in the industry.
“The best part is all the perks – guaranteed hours, benefits, time and a half on Sundays, free turkeys at Thanksgiving, four free memberships, a livable wage,” an employee with six years of experience told Insider in 2018.
Target minimum wage: $US15 ($19) per hour
In June, Target raised its minimum wage to $US15 ($19), up from $US13 ($17). The raise was part of a multi-year effort, with the company promising in 2017 that it would reach a $US15 ($19) minimum hourly wage by the end of 2020.
“Everything we aspire to do and be as a company builds on the central role our team members play in our strategy, their dedication to our purpose and the connection they create with our guests and communities,” Target CEO Brian Cornell said in a statement.
Kroger minimum wage: Varies by region
“Since the start of the pandemic, Kroger has proudly invested over $US1 ($1).5 ($2) billion to safeguard and reward our associates and committed nearly $US1 ($1) billion to secure pensions for tens of thousands of our associates across the country,” a representative said in a statement.
“The biggest issue for many right now is dealing with local ordinances mandating temporary hero pay boosts and bonuses,” Saunders said. “This is causing a lot of issues and a patchwork of different wage structures. Many of the rules are illogical and hard to implement.”
Amazon minimum wage: $US15 ($19) per hour
Amazon raised its minimum wage to $US15 ($19) an hour in 2018.
“At Amazon, we believe $US15 ($19) an hour is the minimum that anyone in the U.S. should be paid for an hour of labor,” 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 $US15 ($19).”
“It’s also why we’re calling on Congress to raise the federal minimum wage to $US15 ($19) an hour and urging other major corporations to increase wages to this level,” the statement continued. “We’re pleased that multiple companies have taken this important step – which will help workers and their families, communities and our overall economy – and hope more will follow suit.”