Ikea has announced that it will raise the minimum wage for U.S. workers to $11.87 per hour. The ten percent increase comes as the world’s second largest furniture retailer looks to deter its workforce from moving to other competitors. Walmart (WMT) and Target (TGT) are among those that have recently increased their minimum wages in response to mounting social pressure. 32 percent of Ikea’s hourly staff will benefit from the raise. The company hopes that the wage increase will reduce worker turnover and attract more competitive job applicants. Federal minimum wage is currently $7.25 per hour. Ikea’s minimum wage increase will take effect on January 1 2016. It’s the second year in a row that the flat pack giant has upped its base rate. Back in June 2014 the company took a new approach to its pay structure, raising its minimum way by 17 percent and pegging the increase to the cost of living in each location. The retailer will now use MIT’s Living wage calculator to determine basic expenses such as food, housing and childcare in given area where stores are located.
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