There are plenty of reasons for companies to reward workers right now. At one point in the past year, the shares traded as low as $65.28 but has recovered 53.78% since then. Walmart must pay employees slightly more to meet minimum levels in those three states. Corporate tax rates were slashed from 35 percent to 21 percent and now companies like Walmart are following through on expectations that businesses will pass those savings on to employees.
In fact, with unemployment at just over 4% and workers' real wages finally rising after years of sluggishness, the giant retailer might not have had much choice, regardless of what transpired in Washington last month.
In a letter to workers of the company, CEO Doug McMillon further explained the benefits of the tax plan.More news: Super Mario Odyssey update will add minigame and other cool features
"We will be able to invest even more in aircraft and facilities, and we will be able to do so with even greater confidence about the future", he said.
In January 2016, Wal-Mart said it would hike its minimum wage for almost all employees to $10 an hour, but it kept its starting wage at $9 an hour for employees in their first six months. Retail was among the industries that proponents of the tax overhaul said were likely to benefit. Company veterans with 20 years will get $1000 dollar bonuses others receive $200 bucks.
The release said the announcement was "based on the passage of tax reform". This is the third minimum wage increase the company has implemented since 2015.More news: Astros GM: 'Nothing imminent' in deal for Pirates RHP Cole
Southwest also said it would give an additional $5 million to charities, and pledged to buy more planes from Boeing, its aircraft supplier. The one-time bonus will amount to $400m in the current fiscal year. It also increased its holding in Vanguard Intl Equity Index F (VEU) by 103,466 shares in the quarter, for a total of 2.94M shares, and has risen its stake in Cisco Sys Inc (NASDAQ:CSCO). The minimum wage increase goes into effect February 17. After boosting wages for some workers to $10-per-hour in 2016, Walmart was already on a path to paying $11-per-hour, especially after Target raised its minimum hourly wage to $11 a year ago.
"A fairer and more competitive tax code will give retailers the ability to modernize stores, invest in their workforce and continue to transform the shopping experience for consumers", Kennedy said.
"A better solution would be to raise the federal minimum wage and not leave it up to corporations", Gould said.
In assessing potential additional investments made possible by the new tax reform law, Walmart will consider the needs and expectations of associates, customers and shareholders while working within its financial framework of strong, efficient growth; consistent operating discipline; and strategic capital allocation.More news: Browns add Eliot Wolf to the rebuilt front office