Walmart announced plans Thursday to raise wages for 500,000 of its U.S. employees to at least $9 per hour by April, and $10 per hour next year.
For the nation’s largest private employer, famous for its poverty-level wages, this seemed to be a bold, “when pigs fly” type of action. But some observers said it’s both a rational business move for Walmart and a PR boost that does far too little to meaningfully improve workers’ lives.
And the general excitement over Walmart’s announcement highlights how “beaten down” expectations about American wage growth have become, said Josh Bivens, research director at the Economic Policy Institute (EPI).
Roe has collapsed and Texas is in chaos.
Stay up to date with The Fallout, a newsletter from our expert journalists.
“Let’s be clear about this: wages rising should be the norm in the American economy and should happen all the time without fanfare,” Bivens said in a statement.
As Neil Irwin put it for the New York Times, Walmart’s strategy may be something like this:
“We think we’re going to need to raise wages this much in the next couple of years anyway to retain good workers and maximize profitability, so we may as well get ahead of the curve and get a public relations bump out of it and announce the plans in a big splashy way.”
That “coldhearted business strategy” could actually be a good thing for workers if other businesses start to think the same way, Irwin said, but it also raises an important question: “What took so long?”
EPI research shows that most Americans have seen their wages fall or stay flat since 1979. The same trend held true from 2013 to 2014—except for lower-wage workers, whose incomes rose mostly because a growing number of states and localities have recently passed higher minimum wage laws.
Meanwhile, a federal law that would raise the minimum wage from $7.25 an hour to $10.10 has languished in a Republican-dominated Congress. That bill would mean a poverty-fighting pay raise for millions of workers, not just the half-million Walmart employees affected by this policy change.
And for Walmart workers like Fatmata Jabbie, a refugee from Saudi Arabia with two young children and a third on the way, a slightly higher hourly wage doesn’t do her much good if she can’t get enough hours.
Jabbie makes $8.80 per hour as a cashier after working for a year at a Walmart in Alexandria, Virginia. She is eight months pregnant and the sole provider for her 3-year-old son and nearly 2-year-old daughter. She wants to work full-time, but says Walmart won’t let her move up.
Jabbie’s unpredictable part-time schedule might get her as many as 26 hours, but often just 18 or 20, and it’s not enough to reliably care for her family, even with government assistance for housing and child care.
“It’s hard,” Jabbie told Rewire. “It’s a shame I can’t afford to buy clothes for my kids. It’s a shame that sometimes it’s hard for me to put food in the house for my children. It’s stressful for me, because all the time I look at their faces, there’s nothing I can do. There’s not much I can buy them, because mommy can’t afford it.”
About 825,000 workers at Walmart, the country’s largest private employer, earn less than $25,000 annually, placing many who have families below the poverty line. Walmart’s employees make up more than 18 percent of the federal food assistance market, according to an Americans for Tax Fairness 2014 report.
Even if Jabbie worked full-time at $9 per hour, she would fall below the federal poverty level of $19,790 for a three-person household. She would squeak past that with $10, but she’d fall below once again after the birth of her third child. And her ability to barely get by depends on whether Walmart would consent to let her work almost twice as many hours as she does now.
Jabbie said she doesn’t have too many child-care problems despite an unpredictable schedule that has her working either days or evenings on short notice. For many women with children, unpredictable schedules can be disastrous and mean losing already-low wages, or even one’s job.
Walmart’s wage policy change also promised to provide fixed schedules with two weeks’ advance notice for “some associates,” but it’s unclear which employees will actually benefit from that.
And then there is the question of working conditions, especially for a pregnant person.
Jabbie says that even though her doctor says she shouldn’t do any heavy lifting, she is still often forced to lift heavy objects for customers at the check-out counter. She has a stool to take sitting breaks, but that’s only because she has a doctor’s note; other pregnant employees, she said, don’t even get that much. And her bosses routinely make her wait until almost the end of her shift to take her break.
Walmart has come under fire for retaliating against employees who have dared to participate in the wave of strikes over the past three years that have helped put public pressure on the retail giant to change its ways. Jabbie is a member of OUR Walmart, a union-backed group that has organized the strikes and tried to organize workers at the notoriously union-hostile corporation.
Walmart seems to prefer occasionally spending large amounts of money to meet some employee demands than to allow those employees to unionize and hold more power in the long term to bargain for better wages and working conditions.
“I’m glad [Walmart] actually listened to us after our protest,” Jabbie said, adding that employees still need much higher wages. OUR Walmart is demanding a $15 per hour living wage, an end to worker retaliations, and more stable schedules.
“They should give their employees what they deserve,” Jabbie said. “Without us, the company would go nowhere.”