Employers who don’t want to pay more than minimum wage might not have a choice.
The recent pay increases announced by Wal-Mart and TJX Cos., which will start to take effect next month, will force competing big-box retailers to raise starting wages if they expect to retain and attract workers, according to economic professors and retail experts.
“No one forces a worker to join Wal-Mart or TJX or Home Depot. They join because they want to, and money is an important motivator,” says Richard Feinberg, professor of consumer sciences and retailing at Purdue University in West Lafayette, Ind.
Minimum wage in Indiana is $7.25 per hour. In Michigan, minimum wage is $8.15.
Those are two reasons some area consumers, especially those who earn the state minimum and have difficulty making ends meet, reacted positively to the announcement that two of the largest U.S. retailers will give raises to their lowest-paid workers.
Starting in April, Wal-Mart plans to increase its starting pay to $9 per hour. By February 2016, all Wal-Mart employees will earn at least $10 per hour.
T.J. Maxx, Marshalls and other stores owned by TJX Cos., based in Framingham, Mass., will increase pay to $9 per hour by June and to $10 in 2016.