Ikea Raises Minimum Wage Again

After initially doing so at the start of this year, Ikea U.S. will again raise its minimum hourly wage in existing stores, the company announced. As of January 1, 2016, the average minimum hourly wage paid in Ikea U.S. stores will grow from $10.76 to $11.87, a $1.11 or 10.3% increase that results in remittance of $4.62 above the current federal minimum wage.

Ikea’s effective minimum wage is based on local living costs for co-workers as calculated by the MIT Living Wage Calculator, the retailer noted, which takes into consideration housing, food, medical and transportation costs plus annual taxes.

The minimum wage increase will affect 42 of 43 Ikea U.S. retail locations, Ikea maintained, and approximately 32% of the company’s hourly retail co-workers in the United States. In addition, effective January 2016, all five U.S. distribution centers and all non-retail locations also will provide minimum wages above the local living wage, Ikea related, and no co-worker will have a minimum hourly wage below $10.

“Ikea not only seeks to understand life at home in order to offer our customers a great home furnishings offer, we also seek to understand our co-workers lives and needs in order to make Ikea a great place to work,” said Lars Petersson, Ikea U.S. president. “This latest wage increase is just the most recent in a series of investments grounded in our commitment to have a positive impact on our co-workers lives.”