Walmart will raise hourly pay for 565,000 workers. (Published 2021) (2024)

Walmart is raising hourly wages for about 565,000 workers in the latest example of a large employer trying to attract and retain employees in a challenging labor environment.

The pay raise, which will total at least $1 an hour and will take effect Sept. 25, will apply to workers in departments such as food and general merchandise.

The company’s average wage will rise to $16.40, Walmart said, though its minimum wage still lags that of other large retailers such as Target and Amazon. As of Sept. 25, Walmart’s minimum starting wage will rise to $12 an hour from $11. In some stores, however, starting wages will reach as high as $17 an hour. Walmart employs about 1.6 million people in the United States.

Employers, particularly in the retail, food service and hospitality industry, have faced a labor shortage during the pandemic. The unemployment rate dropped in July to 5.4 percent, from 5.9 percent. Weekly U.S. jobless claims last week dropped by 14,000 to 340,000, the Labor Department said Thursday, the lowest since March 2020.

Some politicians and companies have attributed the lack of workers to the enhanced unemployment benefits that are scheduled to end this month. But new research shows that these benefits alone are not keeping workers at home, but rather a combination of factors such as a lack of child care, health concerns related to the pandemic and general fatigue working in stressful, low-paid jobs.

This year “has been another trying year, with challenges that few could have predicted,” Walmart’s head of U.S. operations, John Furner, said in a note to employees on Thursday.

In February, Walmart raised wages for 425,000 workers, mostly focused on the company’s fast-growing online grocery pickup operation.