Wal-Mart Stores Inc, the largest US private employer, plans to end profit-sharing contributions next February, replacing them by matching some of the US dollars employees put in their 401(k) retirement plans to pare expenses.
The retailer will match contributions up to 6 percent of eligible employees’ pay, according to a memo obtained by Bloomberg News. Previously, Wal-Mart automatically put up to 4 percent of pay into the profit-sharing plan, according to spokesman David Tovar.
Since taking over last year, Wal-Mart chief executive Mike Duke has pledged to slow expense growth, aiming to counter five consecutive quarters of sales declines at US stores open at least a year. The switch by Wal-Mart, which has about 1.4 million US employees, will only benefit those who are in the plans, so staff will need to join to profit from the move, retirement consultant Byron Beebe said.
“It does require employees to participate,” said Beebe, the marketing head for the US retirement practice at benefits consultant Aon Hewitt in Cleveland. Beebe said 401(k) participation rates in the retail industry are lower than the average, which is about 75 percent.
Tovar wouldn’t disclose what percentage of Wal-Mart’s 1.1 million eligible employees currently contribute to the 401(k) plan, which is administered by Merrill Lynch & Co. Employees must wait a year before becoming eligible, he said.
Kalila Sams, 24, a customer-service manager at a Wal-Mart in Atlanta, said she would welcome a 401(k) match. Sams, who has worked at the retailer for about a year, said she earns US$10 an hour for 20 hours a week.
“Things are tight right now, but it would encourage me to save because you’re putting money away before you see it,” Sams said in an interview.
Some money saved from the switch will go toward quarterly bonuses for store employees, Tovar said. He said the move is part of a “comprehensive benefits package” that offers employees “the potential to receive more income today through our bonus incentive programs, and incentives to save and help them plan for retirement.”
Retirement plans such as the 401(k) allow workers to put money in tax-deferred accounts for retirement. Employer matches to workers’ contributions help employees increase savings and provide an incentive for them to contribute, said Nancy Hwa, a spokeswoman for the Washington-based Pension Rights Center.
Wal-Mart’s profit-sharing plan was created in 1971 by company co-founder Sam Walton, according to his biography, Made in America.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last