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Target Looks to Minimum Wage Boost

Target Looks to Minimum Wage Boost


MINNEAPOLIS, MN
Tuesday, April 19th, 2016

Target has elected to raise minimum employee earnings to $10 per hour. With increasing competition in the job market, as well as labor groups calling for higher wages, sources close to the story informed Reuters that the wage hike will take effect this May.

Molly Snyder, Director of Communications, TargetThough Target declined to confirm it is offering the pay increase, Director of Communications Molly Snyder said in a statement, "We pay market competitive rates and regularly benchmark the marketplace to ensure that our compensation and benefits packages will help us to both recruit and retain great talent.”

But two sources close to the story, speaking under the condition of anonymity, told Reuters that Target management has already informed store managers and employees of the upcoming minimum wage hike.

CNBC also noted that this announcement comes in the wake of Walmart’s increasing minimum wage to $10 per hour, implemented in recent weeks, and that Target has announced a minimum wage boost on the heels of Walmart before.

Target's stock (up .66%) as of 4:36 PM EDT, April 19, 2016. (Photo Source: Google Finance)The $1-per-hour raise marks the second time in a year Target has increased employees’ base salary. According to CNBC, the retailer raised its minimum pay rate last April from the federal minimum of $7.25 per hour to $9 per hour.

The decision to boost compensation reflects growing competition for workers in a strong labor market, the report notes, with CNBC citing a low unemployment rate of 5.0 percent and a historic low for the number of Americans filing for unemployment as factors contributing to Target’s decision.

Target's plan will also raise pay for employees who already make over $10 an hour. Those employees will be entitled to an annual merit raise and pay-grade hike based on experience and performance, according to the anonymous sources.

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