Retail giant Walmart announced Thursday that it plans to raise the starting hourly wage to $11 for its employees in a nationwide measure that will also give employees one-time cash bonuses and boost parental leave benefits.
Walmart officials credited the recent tax reform bill — which lowers the corporate tax rate to 21 percent from 35 percent — with allowing for the salary increase, the company’s third countrywide boost in three years. The federal minimum wage is $7.25, although a handful of states have instituted higher hourly wages.
The wage increase comes as a number of Walmart’s competitors have upped minimum hourly wages.
In a statement on the company’s website, Walmart president and CEO Doug McMillon said the tax legislation “gives us the opportunity to be more competitive globally and to accelerate plans for the U.S.”
“Today, we are building on investments we’ve been making in associates, in their wages and skills development,” McMillon added. “It’s our people who make the difference and we appreciate how they work hard to make every day easier for busy families.”
With 2.3 million employees worldwide, Walmart is the world’s largest private employer, providing 1.5 million jobs in its 4,700 stores in the U.S.. The retailer boasted $500 billion globally in 2017.
The wage increase, which amounts to $300 million, takes effect in February at the start of the company’s fiscal year, and the $400 million boost to one-time cash bonuses will provide up to $1,000 to employees. With the new plan, full-time hourly employees will receive 10 weeks of paid maternity leave and six weeks of paternal leave.
The announcement comes as news that 10 percent of Amazon workers in Ohio receive food stamps. Amazon has increasingly competed against Walmart.
Walmart spokesman Kory Lunberg noted that a “sizeable” number of of stores already pay at least $11 an hour, and that the “vast majority” of Walmart employees will benefit from the company’s most recent wage increase.