Walmart Offers Lower Starting Salaries To New Employees

(CTN News) – Walmart reduced starting pay for new employees picking and packing online orders and stocking shelves, raising questions about a cooling labor market or a return to pre-pandemic shopping habits.

Retailers confirmed that starting wages for personal shoppers and stockers who joined the company in July were reduced. In addition to replenishing shelves in stores, these workers prepare orders for curbside pickup or delivery to customers’ homes.

Employees joining Walmart’s digital or stocking teams now make about a dollar less an hour than they would have if hired several months ago.

According to Walmart spokesperson Anne Hatfield, no current employees in those positions have had their salaries reduced. Walmart also changed the pay bands for more experienced employees in July, which resulted in a wage increase for approximately 50,000 store employees.

Since Walmart employs 1.6 million people, it is closely monitored by economists and industry leaders – including those examining whether inflation of wages and merchandise is slowing. As the labor market remained tight and its pay trailed behind rivals like Amazon and Target, the company raised its minimum wage for store employees from $12 to $14 in January.

Hatfield declined to comment on whether hiring has become easier at the company.

In a statement, Walmart said it made the change so that starting pay would be consistent regardless of whether employees worked at the cash register, stocked shelves, or assisted with online orders.

“With consistent starting wages, staffing is consistent, and customer service is better, and associates are able to gain new skills by gaining experience across the store and lay the groundwork for their career, no matter where they begin,” the statement stated.

Wall Street Journal reported the news of wage changes first.

Walmart’s personal shoppers and stockers began receiving higher pay in March 2021. Based on the store’s location and market, starting wages increased for 425,000 employees to $13 to $19 per hour.

As a result of the move, Walmart treated those employees more like specialists.

Other employees, such as those who decorate cakes in its bakery or change oil in its auto centers, receive higher starting salaries as well.

The big-box retailer was experiencing higher grocery and e-commerce sales at the time of the change. A greater number of Americans are getting vaccinated for Covid-19 and purchasing items to help them get out and about again, such as tooth whitening products.

The sharp growth in company sales was cited by Walmart U.S. CEO John Furner in a memo announcing the change. In addition to seeing overall sales grow, he said the company picked up and delivered 6 billion items in the previous year in an effort to stay on top of the fast-changing shopping habits of customers.

As a result, many retailers have observed shoppers returning to more typical pre-pandemic shopping practices, such as visiting stores more frequently and shopping less online – as well as being more discerning about discretionary purchases. The result has been a decline in e-commerce sales at companies such as Macy’s and Target.

Walmart’s online sales are growing. In Walmart’s latest three-month report, e-commerce sales increased by 24% year over year. However, the company’s earnings haven’t been as impressive as they were when the epidemic first started.

Walmart shares hit a 52-week high on Thursday. Walmart shares have gained about 15% so far this year, just shy of the gains of the S&P 500, but ahead of many others.

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