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Published: Thu, September 28, 2017
Economy | By Melissa Porter

Target employees to get raise, and then some

Target employees to get raise, and then some

Target upped the competition for wages for retailers after announcing Monday it would raise starting pay to $11 in October and $15 in 2020.

The wage increase comes as Target prepares to hire more than 100,000 hourly workers for the busy holiday season. Democratic leadership introduced a bill in July to take the $15 minimum wage national, but the legislation failed to attract the requisite support to advance. Executives at Wal-mart have stated that past wage increases cost the company as much as $2.7 billion, a figure that weighed heavily on the company's stock.

But Target, like many retailers, is struggling to adapt to e-commerce and pricing pressures.

Target raised minimum pay by a dollar in 2015 and 2016, according to Reuters.

Other research has found that retailers, a major cohort of employers in the US, also benefit when wages are higher because consumers are able to spend more freely.

According to Target, a minimum hourly wage of $11 is higher than the minimum wage in 48 states, and matches the minimum wage in MA as well as Washington. Bernie Sanders. And, the city of Seattle is gradually increasing its hourly pay to $15, with many cities across the nation proposing similar legislation.

Two states, MA and Washington, match the minimum wage of $11 per hour although some cities nationwide have even higher levels. Employers have been dealing with a tighter labor market this year, as the unemployment rate has fallen to about 4.4%.

Target's new wage of $11 an hour puts it higher than the minimum wage in 48 states.

Despite the wage increases, the company reiterated its projection of sales and earnings for the third quarter and the full year.

Like all other big brick-and-mortar retailers, Target is looking for ways to adapt to the era of internet shopping. In early 2014, Gap Inc. Last year, Costco Wholesale Corp. Should the minimum wage be raised or lowered in general?

Retailers such as Aldi have been recruiting heavily at UF for future management and regional leaders, offering bonuses and vehicle stipends for new hires, Kirn said.

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