iStock Editorial/Thinkstock(CONSHOHOCKEN, Pa.) — Ikea’s U.S. division is raising the minimum wage for thousands of its retail workers, pegging it to the cost of living in each location instead of to local competition.
The new minimum of $10.76, to take effect in the beginning of 2015, amounts to a 17 percent increase for the lowest-paid employees. About half of Ikea’s 11,000 hourly store workers will get a raise.
The move represents a big shift in approach as far as wage increases go at the Swedish furniture and home accessories retailer. Ikea, which has cultivated a reputation for fair treatment of its workers, evaluates its benefits plans every year and had always adjusted wages based on its competition. But Rob Olson, Ikea’s acting U.S. president, says the company is focusing less on what rivals do and more on the needs of its workers.
“At IKEA, we are guided by our mission ‘to create a better everyday life for the many people,’ a vision that includes our co-workers, customers and the communities impacted by our business,” he said.
“The transition to the new minimum hourly wage structure is not only the right thing to do, it makes good business sense. We are basing our wages on our co-workers and their needs, rather than what the local employment market dictates,” he continued. “Our focus is to ensure that IKEA is a great place to work by providing an environment that develops our co-workers and also meets our customers’ expectations. All of this contributes to our business success.”
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