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On the same day Wal-Mart announced the new benefits, the company also said it will close “a series” of Sam’s Club warehouse locations after a portfolio review, illustrating how cost cutting remains a key focus. Wal-Mart didn’t disclose how many of its 660 units it was shuttering. Business Insider reported it was closing 63 units, citing a company official it didn’t identify.

‘Super Important’

The wage increase comes three years after Wal-Mart’s last big labor outlay, spending US$1 billion in 2015 to lift starting hourly pay to US$9 and then to US$10 the following year — for workers who complete a 90-day training course. The increase cut into profit and was criticized by some longer-tenured employees as unfair to them.

“We’ve seen wage stagnation for many years, so it’s super important for lower-wage workers to see their wages rise,” said Elise Gould, a senior economist at the Economic Policy Institute. “It’s due to two factors — state-level increases and a tightening labor market.”

Since Wal-Mart’s initial increase starting in 2015, many states have enacted minimum-wage laws, meaning that a “sizable group” of its 4,700 U.S. stores already pay $11 an hour, according to spokesman Kory Lundberg.

Workers in the District of Columbia and the states of California, Washington and Massachusetts, already earn at least $11 an hour. And New York, Arizona, Colorado, Maine and Oregon will all reach that level next year, as efforts at the state level to boost livelihoods have gained steam. A total of 18 states have increased minimum pay this year.