Wal-Mart to spend $1 billion to raise US wages this year
Wal-Mart Stores Inc, long criticised for its low wages and employee benefits, said it would spend more than $1 billion to increase pay for half a million US employees this year. The increase announced by the largest private sector employer in the United States will cover about 40 % of its US workforce, but falls far short of what some labour groups have been agitating for.
Wal-Mart Stores Inc, long criticised for its low wages and employee benefits, said it would spend more than $1 billion to increase pay for half a million US employees this year. The increase announced by the largest private sector employer in the United States will cover about 40 % of its US workforce, but falls far short of what some labour groups have been agitating for.
Wal-Mart said on Thursday its hourly full-time and part-time workers will earn at least $9.00 an hour, or $1.75 above the current federal minimum wage, starting in April. Current employees will earn at least $10.00 an hour by Feb. 1, 2016. Labour groups, led by Our Walmart, have been calling for Wal-Mart to pay its workers at least $15 an hour.
Wal-Mart, which has about 1.3 million US workers, has also been a target of activists in the contentious debate over proposals to raise the federal minimum wage of $7.25 an hour.
The world's largest retailer also reported a better-than-expected fourth-quarter profit as shoppers spent more of their savings from lower US gas prices at the company's stores. Same-store sales in the United States rose 1.5 %, the second straight quarter of growth after six quarters of flat or declining sales. Analysts on average had forecast an increase of 0.7 %, according to research firm Consensus Metrix.
However, the company cut its sales forecast for the year ending January 2016, citing a strong dollar.
Wal-Mart, whose shares were down almost 2.7 % at $83.92 in early trading, said it now expected sales to increase 1-2 %, below its previous forecast of 2-4 %. It also forecast earnings of $4.70-$5.05 per share, below the average analyst estimate of $5.19.
Net profit attributable to Wal-Mart rose 12 % to $4.97 billion, or $1.53 per share, for the quarter ended January 31.
Excluding items, the company earned $1.58 per share, according to Thomson Reuters I/B/E/S. Total revenue rose 1.4 % to $131.57 billion. Analysts on average had expected earnings of $1.53 per share on revenue of $132.35 billion.
Wal-Mart also raised its annual dividend to $1.96 per share from $1.92.