Wal-Mart to meet minimum wage mandates through current wage reductions

Illinois Review reports:

Minimum wage increases across the United States - including Chicago - is prompting Wal-Mart to adjust base salaries at 1,434 stores, impacting about a third of its U.S. locations, according to an internal memo reviewed by Reuters.

The memo, which was sent to store managers earlier this month, offers insight into the impact of minimum wage hikes in 21 states due to come into effect on or around Jan. 1, 2015. Thirteen U.S. states, and Chicago, lifted the minimum wage in 2014.

Wal-Mart spokeswoman Brooke Buchanan said the company was making the changes to "ensure our stores in the 21 states comply with the law."

In recent years, Wal-Mart has been struggling to grow sales after many lower-income Americans lost jobs or income over the last 6 years of the Obama administration.

The Wal-Mart memo shows that the government mandated wage increase for lower-skilled workers will come from a reduction in the current pay for higher-skilled employees.

"Essentially that wage compression at the upper level of the hourly associate is going to help absorb that cost of the wage increase at the lower level," said a Wal-Mart manager, who spoke on condition of anonymity.

The compression of wages: in the real world. Thanks central planners from Washington !