Walmart CEO Asks Congress to Raise Minimum Wage

Move by the largest U.S. retailer further fuels minimum-wage debate

Stephen Miller, CEBS By Stephen Miller, CEBS June 7, 2019
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Walmart Chief Executive Officer Doug McMillon is urging Congress to raise the federal minimum wage, calling the current $7.25 minimum wage "too low." The nation's largest retailer, with 1.5 million U.S. employees, has raised its starting wage several times in recent years to the current $11 an hour—still below rivals like Target and Costco—and has faced criticism from unions and progressive advocates for not embracing a $15 hourly wage.

Speaking at the company's annual meeting in Rogers, Ark., on May 5, McMillon said, "It's clear by our actions and those of other companies that the federal minimum wage is lagging behind."

Target has said it will reach the $15 threshold by the end of 2020, while Amazon boosted starting pay for its warehouse workers to $15 an hour last year.

Opponents of a $15 wage note that while big corporations can afford to hike entry-level workers' pay, their smaller competitors might not be able to do so and stay in business—especially in parts of the country where competitive wage rates are lower than the national average.

SHRM Online has gathered the following articles and resources on the minimum-wage debate from its archives and other trusted media outlets and organizations.

Walmart Faces Criticism for Its Own Pay Policies

Supporters of a $15 wage noted that Walmart gave McMillon a pay package worth almost $24 million last fiscal year, while the average Walmart employee makes $25,000 a year.

Sen. Bernie Sanders, D-Vt., took his presidential campaign to Walmart's annual meeting and introduced a shareholder proposal to add representatives from Walmart's rank-and-file to the company's board.

The motion had no chance of passing, but Sanders's presence forced Walmart to address the issue of its treatment of workers. "All we are saying to Walmart and the Walton family is to pay your workers a living wage," Sanders said, "and that living wage is $15 an hour."

(Yahoo Finance)

States and Cities Are Taking Action

Business owners across the U.S. are adjusting to or girding for minimum wage hikes as states and cities bump up their minimum wages, and campaigns, such as the Fight for $15, have become a rallying cry for some 2020 presidential candidates. If business owners are thinking they'll need to raise employee pay soon, they may be right.

(Inc.)

A Politicized Debate

The debate over the minimum wage level is very political. Some people view it is a fair way to redistribute wealth from profitable businesses to frontline workers. The opposing view is that excessive minimum wages actually harm workers by causing businesses to freeze hiring or lay off staff. The political argument also centers on whether the minimum wage is supposed to represent a livable wage, or simply a fair amount for particular work.

Small businesses in local communities, labor jobs with an ample supply of workers and standardized retail operations are among employers that commonly pay minimum wages to new employees.

(Houston Chronicle)

Pay Up or Get Out?

"If your business can't afford to pay a minimum $15 an hour wage, your business cannot afford to exist. You should close it down and let a better-managed competitor hire your employees and service your customers," said PBS commentator Nick Corcodilos, echoing the views of other advocates of a $15 minimum wage.

(PBS)

[SHRM members-only toolkit: Complying with U.S. Wage and Hour Laws and Wage Payment Laws]

$15 Federal Minimum-Wage Bill Moves Forward

A bill that would increase the federal minimum wage to $15 an hour over the next six years is moving to a full House vote, after the House Education and Labor Committee passed the Raise the Wage Act on March 6.

The minimum wage would rise gradually until it reached $15 an hour in 2024. After that, the wage would be adjusted annually to reflect changes in the national median hourly wage.

"Gradually raising the minimum wage is good for workers, who experience a better standard of living; good for businesses, which benefit from having more customers and less turnover; and good for the economy, which is strongest when we lift working people out of poverty and build a thriving middle class," Scott said.

"In my research, I have found evidence that employment decreases when minimum-wage rates are increased," said Michael Strain, director of economic policy studies at the American Enterprise Institute, which supports free-market policies. "Increasing the federal minimum wage from its current level of $7.25 per hour to $15 per hour over a six-year period will likely have a significant and negative effect on employment. The reduction in employment opportunities will be felt most strongly among workers with relatively fewer skills and workers with relatively less labor market experience."

(SHRM Online)


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