Wal-Mart Reduces Employee Hours Following Wage Increase
Kate Scanlon /
Wal-Mart has been reducing the number of hours employees work in some of its stores following a wage increase earlier this year, according to a report by Bloomberg.
The report says “regional executives told store managers at the retailer’s annual holiday planning meeting this month to rein in expenses by cutting worker hours they’ve added beyond those allocated to them based on sales projections.”
The request has resulted in some stores trimming hours from their schedules, asking employees to leave shifts early or telling them to take longer lunches, according to more than three dozen employees from around the U.S. The reductions started in the past several weeks, even as many stores enter the busy back-to-school shopping period.
In February, Wal-Mart announced that it would raise its entry-level wage to $9 an hour. The wage increase took place in April.
Opponents of a minimum wage increase noted that Wal-Mart’s decision to cut employees’ hours in some of its stores came after the wage hike.
Single strongest reason not to increase the minimum wage http://t.co/oA7IYCSjsX
— Matt Mackowiak (@MattMackowiak) August 31, 2015
Wal-Mart cuts hours after minimum wage hike. If only there were people that predicted this would happen. #FightFor15 http://t.co/SDEDVnwpiV
— Razor (@hale_razor) August 31, 2015
Wal-Mart’s profits are directly affected by #wage increases as compensation #costs are passed to #consumershttp://t.co/7h42g0ow8l
— Prof. Steve Hanke (@steve_hanke) August 30, 2015
A spokesperson for Wal-Mart denied a correlation between the reduction in hours and the wage increase, attributing the reduction in hours to “overscheduling” at individual stores.
“Earlier this year Wal-Mart committed to investing an additional $1 billion in our associates through wages, training, scheduling and staffing,” Kory Lundberg, the director of national media relations at Wal-Mart, said in a statement provided to The Daily Signal.
“We see that investment resonating with our customers and associates through higher satisfaction and engagement scores,” Lundberg said. “As we head into the most important part of the year for any retailer, Wal-Mart is committed to continue improving the customer experience and will protect the investments necessary to achieve this goal, including staffing, wages and the addition of more than 8,000 new department managers and more than 3,500 Pick-Up department managers to our stores for the remainder of the year.
“The reduction in hours is taking place only in locations where managers have overscheduled workers, staffing the store for more time than they’ve been allotted. The reductions won’t affect efforts to better staff stores, shorten checkout lines, and improve cleanliness and stocking,” Lundberg continued.
James Sherk, senior policy analyst in labor economics at The Heritage Foundation, said “the government cannot mandate the creation of ‘good’ jobs.”
“Employers respond to wages that rise without offsetting increases in productivity by reducing the numbers or hours of their workforce,” Sherk said. “There is no such thing as a free lunch.”