Walmart cuts starting pay for new hires who prepare online orders, stock shelves

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A Walmart employee stocks shelves on the 24th of January 2023, in Miami, Florida. Walmart has announced it will raise its minimum wage in early March. Store employees will earn between $14 and $29.

Joe Raedle | Getty Images News | Getty Images

Walmart has cut starting pay for new store employees who pick and pack online orders and stock shelves, raising questions of whether companies face a cooling labor market or are adjusting to a return to pre-pandemic shopping habits.

The retailer confirmed that starting wages were reduced in July for personal shoppers and stockers who now join the company. The new Walmart employees joining the digital and stocking teams make less money than if they were hired a few months ago. As part of the change in July, Walmart also tweaked pay bands for more experienced employees, leading to a wage raise for approximately 50,000 store employees, she said.

Walmart, as the biggest private employer in the U.S. with 1.6 million people, is a closely watched company for economists and industry leaders — including many who have scoured for signs of whether inflation of wages and of merchandise is cooling. It had hiked its minimum wage for store employees from $12 to $14 in January, as the labor market remained tight and its pay trailed behind rivals like

Amazon

and Target.Hatfield declined to say if the company has seen it become easier to hire.In a statement, Walmart said it made the change so its starting pay was consistent, whether a store employee worked at the cash register, stocked shelves or helped with online orders.

“Consistent starting pay results in consistent staffing and better customer service while also creating new opportunities for associates to gain new skills from experience across the store and lay the groundwork for their career regardless of where they start,” the statement said.

The news of wage changes was first reported by The Wall Street Journal.

The higher pay took effect in March 2021 for Walmart’s personal shoppers and stockers. The Wall Street Journal first reported the news of the wage changes.

The higher pay took effect in March 2021 for Walmart’s personal shoppers and stockers. Walmart also offers higher wages for other positions, like those who work in its bakeries or auto centers to change oil. Walmart U.S. Chief Executive John Furner cited a sharp increase in sales when announcing this change. He said that the company had increased its overall sales, but also picked up 6 billion items in the past year for pickup and deliveries. They needed to act quickly to stay on top of the rapidly changing customer shopping habits. That’s led to declining e-commerce sales at companies including

Macy’s

and Target.

Walmart has continued to put up strong online sales growth. Walmart U.S.’s e-commerce sales jumped by 24% in its fiscal second quarter. This is the most recent three-month period. But that is not as dramatic as the gains that the company posted during the early years of the pandemic.

Shares of Walmart touched a 52-week high on Thursday. The stock of Walmart has risen about 15% this year. This is just a little less than the S&P 500, but still ahead of other retailers.