The move comes three years after Wal-Mart last announced it was raising wages, spending $1 billion in 2015 to lift starting hourly pay to $9 and then to $10 the following year -- for workers who complete a 90-day training course. The increase cut into profit and was criticized by some longer-tenured employees as unfair to them. Since then, many states have enacted minimum wage laws, meaning that a “sizable group” of its 4,700 U.S. stores already pay $11 an hour, according to spokesman Kory Lundberg.

“We think this is a prudent use of tax reform proceeds as it reinforces the company’s commitment to improving in-store service levels and will pressure other retailers to invest more heavily into wages and prices,” Ben Bienvenu, an analyst at Stephens, said in a note.

Investors didn’t have a strong reaction to the pay hike. The shares were littled changed on Thursday, trading at $99.65. The stock advanced 43 percent in 2017.

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Lower unemployment

The nation’s unemployment rate has also plummeted to 4.1 percent from 5.7 percent since Wal-Mart’s first announcement of higher wages in 2015, creating a battle to recruit and retain cashiers and shelf stockers.

Even with the wage bump, many workers will struggle if they’re the sole breadwinner. A rate of $11 an hour translates to $22,000 a year for a typical 40-hour week, without paid vacation time. The federal poverty level for a family of four is about $24,600, according to the U.S. Census Bureau.

The wage hike follows Target’s October decision to increase its minimum hourly wage to $11, which it will further boost to $15 by the end of 2020. Costco Wholesale Corp. and other retail chains like TJX Cos. have also raised wages in recent years.

The moves by Wal-Mart and others could help move the needle on stubbornly stagnant wage growth during the current economic expansion -- if an increasing number of companies follow with their own pay hikes. Average hourly earnings for production and non-supervisory workers were up 2.3 percent in December from a year earlier, according to Labor Department figures. In the previous economic uptick, wage growth peaked in December 2006 at 4.2 percent on a year-over-year basis.

Publicity wave

Wal-Mart’s decision makes it the latest corporate titan to plow expected tax savings into employee payouts. Boeing Co., AT&T Inc. and Wells Fargo & Co. have all made similar announcements in recent weeks. Wal-Mart said it’s “early in the process of assessing potential additional investments” it could make.

Wal-Mart also is coming off a resurgence in same-store sales in recent years, giving it more of a cushion to boost pay. Last quarter, the Bentonville, Arkansas-based company posted its strongest U.S. sales gain in more than eight years.

Bonus bucks

The one-time bonuses will range from $200 to $1,000, depending on how long workers have been with Wal-Mart. The idea is to reward employees who won’t benefit from the new starting wage.

The company also will provide full-time hourly workers with 10 weeks of paid maternity leave and six weeks of paternal leave. Parents who adopt kids will get the same benefit, along with $5,000 to help cover the costs.

— With assistance by Vince Golle

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