Target Raises its Minimum Wage to $13 an Hour
Target Corp will raise its U.S. minimum wage to $13 an hour in June, from $12 currently, increasing its payroll costs and putting new pressure on rival Walmart to attract retail workers in a tight labor market. Minneapolis-based Target employs over 300,000 workers and runs 1,845 stores in the United States. The company is investing billions to improve its supply chain, grow its online sales and improve delivery of merchandise to customers’ homes. Target previously raised minimum hourly pay to $12 in March 2018 from $11. In 2017, Target said it was committed to raising its minimum wage to $15 an hour by 2020. The wage increase will affect “tens of thousands” of employees, a Target spokeswoman said.
Total Retail's Take: Target's announcement that it will be raising its minimum wage for hourly employees reflects the tight labor market we're currently in, creating competition for in-store staff for retailers with significant physical footprints. As the competition for labor intensifies, we've seen retailers increase wages and employee benefits to make themselves more attractive to job-seekers as well as their current workforce. The employee turnover rate in the retail industry has historically been higher than most other sectors, a challenge companies are looking to address by investing more money and resources into store staff. And if retailers are able to attract and retain higher-quality workers, they figure to save on turnover costs.