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The New York Times reports that Walmart yesterday announced that it will give a raise "to about half-million U.S. workers as part of a $1 billion investment that includes changes that Wal-Mart says are aimed at giving workers more opportunities for advancement and more consistent schedules."

According to the story, "Wal-Mart is raising entry level wages to at least $9 an hour in April and to at least $10 an hour by February of next year. That includes the less than 6,000 workers who make the federal minimum wage. With the changes, the average full-time wage at Wal-Mart stores will be $13 an hour, up from $12.85. For part-time workers, the hourly wage will be $10, up from $9.48 ... In addition to raises, Wal-Mart is also doing things like offering hands-on training for new workers in areas including teamwork, merchandising, retail fundamentals and communications. It's also rolling out a program that offers some workers fixed schedules so they can be able to choose the same hours each week."

"What's driving us is we want to create a great store experience for customers and do that by investing in our own people," Doug McMillon, Walmart's CEO, tells the Associated Press in an interview. "A better store experience results in happier customers, resulting in stronger sales."

The Times writes that "the changes come as the company has faced increased pressure to pay its hourly employees more. But Wal-Mart, which has been criticized for its messy stores and poor customer service, says it's also focusing on recruiting and retaining better workers so that it can improve its business.

"The company has struggled with disappointing sales for most of the past two years, even though it posted better-than-expected results during the most recent holiday season. Wal-Mart hopes that taking better care of its workers will lead to better-run stores, more satisfied customers and an increase in sales and profits."

The Wall Street Journal writes that "Wal-Mart ’s pledge to raise pay for half a million U.S. employees reflects a tightening labor market and rising competition for lower-paid workers. It also could amplify gains for low-wage workers across the nation as other companies follow the nation’s largest private employer." And, it notes that "the National Retail Federation, the industry’s lobbying group, said Wal-Mart’s decision shows that lawmakers’ efforts to raise the minimum wages are 'politically driven' and 'unnecessary'."

The Journal also suggests that Walmart's move "should help it reduce turnover and will likely put the most direct pressure on Target, given that their pay scales for entry-level positions are generally close and there is broad overlap in product lines."

In other Walmart news, Business Insider reports that in the face of expected 2015 growth that it a little lower than it originally projected, Walmart has decided to invest more in its online operations and less in its physical stores, though the company has committed to improving the customer experience in-store by fixing out-of-stocks and slow checkout lines. In addition, the company has said, it knows that it needs to be sharper on price and broader in terms of assortment.
KC's View:
It seems to me that this is less about the money and more about the idea that engaged, committed employees on the front lines will make Walmart a better shopping experience. I have no idea whether these raises will make an enormous difference in people's lives; I suspect that before too long, we'll all see surveys that will argue both sides of this point.

Is this raise a publicity stunt, or a reasonable attempt to give people a wage on which they can sustain themselves and their families? I'm not sure it can fairly be called a stunt, but I wonder how many of these folks will be able to give up second jobs because of it.

But I think McMillon is right that happy employees will lead to a better store experience, which will mean happier customers. It remains to be seen whether, in the behemoth that is Walmart, these changes can effectively improve the culture and engage the employees.