Ross Stores Joins Wal-Mart and T.J. Maxx in $9-an-Hour Club

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Ross Stores Inc. is joining Wal-Mart Stores Inc., Target Corp. and TJX Cos. in the $9-an-hour club.

Ross, a discount clothing chain based in Dublin, California, said on Thursday that it’s boosting its starting hourly pay to that level, a response to mounting wage pressure. The company made the announcement on its earnings conference call, saying it was making the change this quarter.

The move helps solidify $9 as a standard for starting pay in the retail industry. Wal-Mart bumped its wages to that amount in April, and Target followed suit. Ross’s direct competitors T.J. Maxx and Marshalls, which are both part of TJX, plan to do the same in June. The U.S. federal minimum wage is currently $7.25.

“We expect wage rates are going to move up over the next few years,” Ross Chief Operating Officer Michael O’Sullivan said on a conference call. “You’re seeing that in the press almost every day. So it’s certainly something that we expect that we’re going to be talking more about as we get into our budget for 2016 and our longer term plans.”

Wal-Mart and others have also pledged to increase wages to $10 next year. Ross didn’t commit to that, saying it would wait to see what happens. While the $9 move will add to expenses, the company expects to find efficiencies that can offset the hike, O’Sullivan said. Ross’s sales growth and earnings topped analysts’ estimates in the first quarter.

O’Sullivan also sees a broader benefit to workers getting a pay bump.

“There is a silver lining here in that the customer has more money in their pocket because of higher wage rates that could well help our top line as well,” he said.

(A previous version of the story was corrected to fix Ross’s headquarters city and the name of the executive quoted.)

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