Target raises minimum wage to $24 an hour in competitive markets

To lure workers into its stores and distribution centers, Target is raising the minimum wage up to $24 an hour in markets where they face the fiercest competition to find and hire staff.
The Minneapolis-based discount retailer said Monday it will adopt minimum wages ranging from $15 to $24 an hour, with the higher wage going to hires in the most competitive markets. He currently pays a universal starting salary of $15 per hour.

The new starting salary range is part of a plan by the company to spend an additional $300 million on its workforce this year that will also include broader and faster access to health care coverage for its hourly workers.
"The market has changed," Target CEO Brian Cornell said in an interview with The Associated Press. "We want to continue to have a leadership position in the industry."
Target set a new milestone for the retail industry in 2017 when it announced it would increase hourly wages to $15 by 2020. But the dynamics of the US labor market have changed during the pandemic, with many employers facing severe worker shortages. . And many of Target's rivals now pay a minimum of $15 an hour or more.
Target, which has about 1900 stores and 350 employees in the US, noted that the turnover rate among its employees is now lower than it was before the pandemic. The retailer also said it was able to exceed its goal of hiring 000 temporary workers in its stores and 100 in its supply chain network across the country during the 000 holiday season. But Target has realized it needs to have a focus even more localized wages. He said he's still doing his analysis and declined to name the areas that will command the highest starting salary.

In its most competitive markets for finding and hiring workers, @Target is offering up to $24 an hour to entice would be employees.
– CBS4 Miami (@CBSMiami) February 28, 2022

When Target first announced in 2017 that it would pay $15 an hour by 2020, it was one of the first major retailers to do so. But during the pandemic, several rivals like Best Buy followed suit, with some outperforming Target. Costco raised its minimum hourly wages for workers from $16 to $17 last fall. Amazon's starting salary is $15 an hour, and the e-commerce giant's national average starting salary for jobs in transportation and fulfillment is $18 an hour.
Walmart is falling behind. Last fall, it raised its minimum wage to $12, from the base of $11 an hour it set in 2018. Walmart also raised the hourly wages of more than 565,000 store workers by at least a dollar.
Many retailers say they are having a hard time finding workers in competitive markets. According to a recent survey of more than 100 major retailers with annual revenue between $500 million and more than $20 billion, 96% said they had trouble finding employees in stores. The survey conducted by global consultancy Korn Ferry in January also found that 88% said it was difficult to find workers at distribution centers.

We're supporting Team Target by setting a new starting wage range and enhancing benefits in 2022! Learn about our latest investment:
— Target News (@TargetNews) February 28, 2022

In January, the median wage for retail workers, excluding managers, increased 7,1% from a year earlier to $19,24 an hour. That's faster than pre-pandemic gains. In January 2020, the salary of retail workers increased by 4,2% from the previous year. In January 2017, it was up just 1,7% from a year earlier.
But inflation has eaten up most of those gains, with consumer prices rising 7,5% last year, the biggest increase in four decades. However, that rise in inflation followed a year of moderate price increases. Over the past two years, according to research from the Dallas Federal Reserve, wage increases have been strong enough to offset inflation in competitive markets, leaving workers, on average, with wages adjusted to the slightly higher inflation.

Miami Daily
Author: Patricia Chung 5:50 pm

Pin It on Pinterest

Share This
× How can I help you?

We find the business for you

Please fill out this form