Target's decision reflects growing competition for workers in an increasingly strong labor market. The move last April matched a similar announcement by Wal-Mart.
Compare Employers: Cashier at Target Corporation Hourly Rate | PayScale
Such workers will be entitled to an annual merit raise and a pay-grade hike, which is related to experience and position of the employee, said the sources, who spoke on condition of anonymity as they were not authorized to speak to the media. Target declined to confirm it is offering the pay increase. Snyder said the company does not disclose details of its compensation programs and declined to comment on how many of the retailer's roughly , employees at its nearly 1, stores would receive the raise.
Target also is pushing for higher online sales, which could potentially explain why it has lagged its larger rival in setting the lead on wage increases, analysts said. At its Analyst Day in March, Target said it expects annual gross margin rates around 30 percent.
Even before the wage hike, Barclays Capital Inc last month had downgraded the stock from 'overweight' to 'underweight. Of the 26 analysts who cover the stock, 11 rate it a "buy," and 13 rate it a "hold," according to data from Thomson Reuters StarMine. Target, which generally is considered to be a better employer due to its competitive wages and compensation-related benefits than many retail rivals, has in recent months seen a spate of labor-related issues.
Last September, Target lost a bid to prevent the formation of a micro-union by pharmacy workers in a New York store, which would have marked the first time Target employed unionized workers in one of its stores.
Target later sold its pharmacy business to CVS Health Corp.
Then earlier this month, a Target group leader filed a lawsuit accusing the company of failing to pay overtime to workers with low-level management responsibilities at its warehouses in New York state.
Target's Snyder said the retailer has not changed how it approaches scheduling and hours in its stores. A current part-time employee, who spoke on condition of anonymity as she was not authorized to speak to the media, said she averaged about hours every week before March , but has progressively seen her hours cut. She now averages at about hours per week. Uber Technologies Inc Chief Executive Travis Kalanick, co-founder of one of the most influential technology companies of its generation, resigned on Tuesday under mounting pressure from investors over his leadership.
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