Target plans to raise the minimum wage it pays employees to $9 an hour starting next month, Bloomberg reports, citing a source “with knowledge of the matter.” The decision, if true, would make Target the latest addition to a list of big retailers that have upped their worker pay in recent months. Walmart, Gap, Ikea, and TJX, the parent of T.J. Maxx and Marshalls, have also made similar changes.
Walmart’s mid-February announcement that it would raise its hourly minimum to $9 for full-time workers was likely the most important factor in tipping Target’s scale. But across retail, prospects for workers are looking up. The industry’s “quit rate”—a measure of how many people quit their jobs in a given month—is rising. When that number climbs, it’s usually interpreted as meaning that workers are both more willing and more able to leave their jobs, presumably because they think they can find better or higher-paying work elsewhere. That, in turn, can prompt companies to raise wages in order to retain staff.
Another corporation just decided to raise wages out of the goodness of its heart. http://t.co/hKZX7mXdBs— Joseph Weisenthal (@TheStalwart) March 18, 2015
JK LOL. It's actually cause the quit rates in retail is on the rise. pic.twitter.com/dd3QMwXqgR— Joseph Weisenthal (@TheStalwart) March 18, 2015
Looking at the economy more broadly, the jobs market has been enjoying a healthy growth streak and may finally be getting tighter. That said, while the assumption is that at some point wage growth will start picking up as well, so far this hasn’t really happened. In a sign of the mixed economic messages we’re getting, the Federal Reserve’s policymaking committee earlier today dropped the word “patient” from its statements about monetary policy but remained cautious about the possibility of raising interest rates for the first time since the recession. “Just because we removed the word patient from the statement doesn’t mean we’re going to be impatient,” Fed Chair Janet Yellen said at a conference following the statement’s release.
It’s probably too soon to look at the wage increases retailers are announcing and say whether that momentum will carry over to the rest of the labor market. Nevertheless, it’s good news for the workers in that industry. And considering how Target just laid off 1,700 employees at its headquarters in Minneapolis, it’s nice to think that at least some of those savings might be going back to its lowest-paid employees.