Walmart Offering Raises, Bonuses To Keep Workers Now Through Holiday Season

In a very tight labor market, Walmart is trying to lock in its workforce through the holiday season, which begins in less than a month. 

An interesting question is whether the company will ever be able to reduce compensation again, given workforce expectations. JL

Melissa Repko reports in CNBC:

Walmart is giving weekly bonuses to warehouse workers, as the retail giant competes in a tight labor market and ramps up for the holiday season. It is part of a growing number of retailers and restaurants that have stepped up pay, dangled new perks and tweaked recruitment and retention strategies. Walmart’s warehouse workers already have higher pay than store associates. The added pay is also intended to get ahead of the rush of the holiday shopping season and make sure store shelves and warehouses are stocked.

Walmart is giving weekly bonuses to warehouse workers, as the retail giant competes in a tight labor market and ramps up for the holiday season, the company told CNBC.

The discounter is offering additional pay, based on the facility’s location and the worker’s role and shift. For some full-time workers, that will add up to $200 more per week and could be more if they work overtime, according to Walmart spokesman Scott Pope. That extra pay began this month and will continue through the fiscal year at the majority of distribution and fulfillment centers, he said.

Walmart’s warehouse workers already have higher pay than store associates. Employees in distribution and fulfillment centers had an average hourly wage of $20.37, excluding drivers, higher than the average wage of $14.61 for Walmart U.S. at the end of 2020, according to the company’s environmental, social and governance report. The company has since increased wages. As of March 2021, the company said the average hourly wage in the U.S. is over $15.25 per hour.

The bonuses were first reported by The Wall Street Journal.

Walmart is country’s largest private employer with 1.6 million employees. It is part of a growing number of retailers and restaurants that have stepped up pay, dangled new perks and tweaked recruitment and retention strategies in recent weeks. Many companies have spoken of their struggles to fill jobs, amid an reopening economy. They’ve attributed the labor shortage to a wide range of factors, including concerns about Covid-19, a lack of child care and supplemental unemployment payments.

For Walmart, the added pay is also intended to get ahead of the rush of the holiday shopping season — and make sure store shelves and warehouses are stocked, Pope said.

Walmart faces challenging year-over-year sales comparisons after strong sales during the pandemic. Plus, with the rise of the delta variant and changing consumer habits, more shoppers may want to ship packages to their doors or pick them up in the parking lot.

Walmart shares are up less than 1% so far this year. In trading early Friday, shares were up less than 1%.

CVS Health said earlier this week that it will boost pay for workers and drop education requirements, such as having a high school diploma or GED requirement to qualify for most entry-level roles. It said it would raise its minimum wage from $11 to $15 an hour as of July 2022.

Target rolled out a new perk this week, too: A debt-free college education for full- or part-time employees, which will begin in the fall. The company will also help fund graduate degrees. Walmart, which already has a similar education benefit, recently said it is dropping a $1 a day fee and will pay 100% of college tuition and textbooks.

Target also recently announced a $200 bonus for all of its approximately 340,000 hourly workers, which will be paid out this month. The company said investments total $75 million.