Dive Brief:
- Doug McMillon, CEO of Walmart, the world's largest private employer, called on Congress to raise the federal minimum wage during remarks at the company's annual shareholder meeting Wednesday.
- "$7.25 is too low," McMillon said. "It's time for Congress to put a thoughtful plan in place to increase the minimum wage." Walmart's current minimum hourly wage for store associates is $11 an hour.
- McMillon said any plan to raise the minimum wage should take both a phased approach and cost of living into account. He also said Walmart has invested an "incremental $4.5 billion" in employee pay beyond traditional wages for its U.S. store and club associates.
Dive Insight:
McMillon spoke amid heightened public attention around Walmart's shareholder meeting due in part to the presence of presidential candidate Sen. Bernie Sanders, I-Vt., who also spoke at the event, according to a reports from NPR and other media outlets.
Sanders and others have pressured large employers like Walmart to raise their hourly minimum wage to $15 an hour. But Sanders called the retailer out specifically by co-introducing a bill in 2018 titled the Stop Welfare for Any Large Monopoly Amassing Revenue from Taxpayers (Stop WALMART) Act. The bill would prohibit large employers from buying back shares of their stock unless they make concessions, which included paying workers a $15 hourly minimum and increased paid time off.
Raising the minimum wage is an ongoing debate at the national level at a time when wage growth itself has upped slightly; ADP research shows U.S. wage growth is at 3.8% as of April 2019, up from 3.4% in 2018. A thin labor market may be the cause for some of that growth, although some economists say that "abrupt" pay increases across the board are unlikely to occur soon.
Economists debate whether minimum wage increases would help or hurt economic growth on a broad scale. Experts who've previously spoken with Retail Dive's sister publication HR Dive say employers could be reluctant to increase wages for large shares of their workforce due to uncertainty about future economic conditions. Lower wages may also be the result of a swath of older, higher-paid workers retiring.
Activism around bringing the minimum wage to $15 an hour has arguably led to changes at the state and local levels; a few states have adopted, or are planning to adopt, a $15 minimum wage, while others have announced smaller hikes within the past year. Employers — including retailers who directly compete with Walmart — have announced similar plans.
