A job market that favors the worker may be heading towards an end, as Walmart begins to scale back its pay for new hires, according to reporting by the Wall Street Journal.
According to the Wall Street Journal, the box retailer said it will now offer new employees the lowest possible wage at its stores, suggesting employers are beginning to cut labor costs and that a once tight market is beginning to loosen. However, Walmart told Supermarket News that there are some new associates in certain departments who make more than the starting rate.
Walmart said the new pay structure will allow new workers to handle a variety of duties, creating better staffing throughout the store.
More than 50,000 Walmart workers actually received raises because their pay was below the new minimums.
Walmart said none of the workers currently on the payroll received a cut in pay. The retailer currently employs about 1.6 million in the U.S.
“Consistent starting pay results in consistent staffing and better customer service while also creating new opportunities for associates to gain new skills from experience across the store and lay the groundwork for their career regardless of where they start," Walmart said in an emailed statement to SN. "This change also included raises for approximately 50,000 associates in specialty areas of the store as we continue to invest in associates’ growth and development.”
Earlier this year Walmart announced it was raising its minimum hourly wage from $12 to $14 to better compete with competitors. Amazon and Target both pay a $15 an hour minimum.
According to the Wall Street Journal, the job market has been changing over the last few months. Hiring took a step back during the summer as the unemployment rate rose to 3.8% in August and starting pay is being lowered.
Retailers also are preparing for higher costs during the holidays, so they are finding ways to cut in other areas.
Walmart, however, continues to make investments for its workforce. Corporate employees are getting an AI “assistant” tool to speed up productivity. The tool’s “My Assistant” feature will summarize documents and speed up projects.
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Walmart will lower the pay rate of new employees. The retailer says the move will create better staffing in stores. Do you think more retailers will start paying new hires less, signaling that the job market is starting to loosen?
Let us know in the comments below, or email your thoughts to the SN staff at [email protected]. Please include your name and job title.
