Walmart, the world’s biggest retailer, is taking a huge step towards customer and employee satisfaction by raising wages. This week, the company announced that as of April, 500,000 employees will have their wages increased to $9 per hour and by February 2016 hourly employees who finish 6 months of training will obtain a minimum of $10 per hour.
Walmart CEO Douglas McMillon explained the company’s decision as being based on the link between employee and customer satisfaction: “customers need to be served and associates need to be happy and love their job.” He added that when employees are happy with their work, they serve clients better. With improved customer store experience comes an increase in sales and better returns for Walmart’s shareholders.
The first public statement regarding an increase in hourly wages was made last year when hundreds of Walmart employees, together with other people working in the fast-food and other low-wage industries, marched in four U.S. cities demanding full-time jobs and a starting hourly salary of $15.
Walmart has been criticized for many years due to its low wages, exploiting its employees, many of whom are part of the working poor, and discriminatory employment methods.
Numerous Walmart employees working full-time need food stamps and other such programs in order to meet their basic needs. This is why, during the holiday food drives for the less fortunate, many of the people who received the donations were actually Walmart employees.
Walmart is an important retailer as it gives senior citizens the opportunity to meet all their shopping and pharmaceutical needs thanks to the low prices. Walmart also helps the economy as it offers job opportunities to more than 1.3 million Americans. Unfortunately, more than 70 percent of new Walmart employees resign after the first year, according to Mellody Hobson, president of Ariel Investments and financial contributor and analyst for CBS News.
Due to high rates of resignation, Walmart needs to periodically spend money on recruitment and onboarding. These costs would decrease if employees would keep their jobs longer. And this would surely happen if wages would be more acceptable.
As there is always the need for minimum-wage employees, it is important to give them an incentive to prevent resignation and offer them a minimum of satisfaction at their work place.
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