The new normal?
While the federal minimum wage has languished at $7.25 since 2009, a number of companies have stepped up and pledged to raise their lowest pay rate to $15 an hour. That has happened partly due to public pressure and partly because labor shortages have forced companies to pay more in order to fill open positions and retain workers.
No matter the reason for the increases, bringing workers to a minimum wage of $15 an hour should have a major impact on their lives. Going from $10 an hour ($400 a week, or $20,800 a year) to $15 an hour ($600 a week, or $31,200 a year) may not put someone on easy street, but in many markets, it at least makes it possible to pay for basic necessities.
The companies doing this may not be doing so for altruistic reasons -- some are clearly giving in to public and political pressure -- but workers getting paid more probably don't care why. These are not the only companies that have agreed to raise worker pay to at least the $15 threshold, but they are some of the biggest employers in the country doing so.
A better climate for workers
While it's discouraging that this list is so short, progress is being made. When a company like Amazon or Target raises wages, that should force other players in retail to do the same thing, or risk losing out on the best workers.
Given the current low unemployment rate and the huge demand for seasonal workers, more companies are going to have to raise minimum wages. In addition, some cities including New York state and the city of Seattle have $15 minimum wage laws that are being phased in, and other municipalities are at least considering doing the same.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Daniel B. Kline has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon and Walt Disney. The Motley Fool recommends Costco Wholesale. The Motley Fool has a disclosure policy.