The retail giant Gap recently announced their intent to raise the minimum wage of their employees. The store claims that by June 2014, all U.S. employees will be paid at least $9 an hour, and will further raise the minimum to $10 an hour by June 2015. This announcement comes after President Obama announced the intention of raising the minimum wage of federal contract workers to $10.10 an hour by 2015, and urged businesses to take steps to raise employee wages to a reasonable living wage. Gap owns not only Gap outlets and retail stores, but Banana Republic and old Navy as well. The store estimates that the wage increase will benefit approximately 65,000 employees.
Response to the Wage Raise
President Obama applauded the company’s announcement. President Obama has expressed his desire to raise the federal minimum wage across the board, but has stated that only Congress has the power to approve such a move. There is much controversy over whether an increase in minimum wage would help or harm the state of the economy, as well as businesses.
On the heels of the Gap announcement, many questioned the largest private employer in the country, Wal-Mart, about raising wages for employees. A Wal-Mart spokeswoman, Brooke Buchanan, told reporters that Wal-Mart remains neutral on the issue of raising the minimum wage. Buchanan also claimed that most full-time Wal-Mart employees already make over $10.10 an hour. Buchanan says that the company is investigating the effect that a wage raise will have on the business.