Target will raise its minimum wage to $13 an hour in June after setting a $12 minimum in March 2018. The increase is expected to help the retailer attract associates in a tight labor market, and is in line the Target’s 2017 commitment to reach a $15 minimum wage by 2020.
The higher minimum wage will affect “tens of thousands” of employees, a Target spokesperson told Reuters, adding that the retailer would evaluate pay rates for employees already making $13 an hour and make adjustments as appropriate.
Target cited the earlier minimum wage hikes as contributing to its strong performance during the 2018 holiday season. The retailer saw overall sales grow 5.7% during period, including 29% digital sales growth and a 60% increase in orders fulfilled through either in-store pickup or curbside pickup services.
“Take this past holiday, when we set out to hire 120,000 seasonal team members to support our teams during the big shopping rush,” said Melissa Kremer, Chief Human Resources Officer at Target in a blog post. “We were able to start them all at $12 or more — and that helped us reach our seasonal hiring goal ahead of schedule, which gave our teams a lot of extra time to train and prepare for our busiest season of the year.”
Other retailers have been increasing their starting wages as well. Amazon increased its minimum wage to $15 an hour for all U.S. employees, including those at Whole Foods and other subsidiaries, as of Nov. 1, 2018. The e-Commerce titan also boosted its minimum wage in the UK and started advocating for an increase in the U.S. federal minimum wage.
However, not every retailer is feeling the need to immediately boost wages to the $15 mark. Walmart currently pays an entry-level wage of $11 an hour, a rate that was set in Feb. 2018. The retail giant also has expanded maternity and parental leave benefits and started providing financial assistance to employees who are looking to adopt a child.