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Target is reportedly planning to double bonus payments to salaried employees for 2023.
"Based on Target's performance in 2023, including the $2 billion in additional profit growth our team delivered that exceeded the goals we set at the beginning of the year, we're rewarding our team accordingly," the retail giant said in a statement.
First reported by Bloomberg News, salaried Target employees only received 50% of the maximum payout last year, but thanks to anticipation that sales will recover in 2024, and a more profitable quarter than expected, this is set to double.
Salaried workers eligible for the bonus include store managers and supply chain operation leaders.
Hourly workers, who account for the overwhelming majority of Target’s 415,000-strong workforce, are not eligible for the sizable payout. Nor are senior executives who benefit from a separate bonus structure.
Bullish retail behemoths bumping bonuses for salaried workers in 2024
Target joins competitor Walmart in confidently rewarding its salaried workers with improvements to their pay packet in 2024.
Earlier this year, Walmart announced plans to redesign its bonus scheme, increasing the weight of store profits when calculating the bonus, alongside sales, allowing store managers to earn up to 200% of their base salary.
It also increased the average salary for its store managers from $117,000 to $128,000 per year, though the bump applies to the minimum starting base salary new store managers can earn, rather than the maximum packet.
Cedric Clark, Executive Vice President, Store Operations, Walmart U.S., said the retailer is “on a journey of investing in our associates - from offering competitive front-line pay to benefits that support associates’ health and well-being in all aspects of life.”
The moves from Target and Walmart indicate there may be a resurgence in bonuses from U.S. employers, after payouts dropped from 2022 to 2023.
According to research from payroll software platform Gusto, year-end bonuses awarded to U.S. employees fell by 21% last year from an average of $2,730 in December 2022 to $2,145 in December 2023.
