Gap To Raise Minimum Wage For U.S. Workers

By Anna Prior 

Gap Inc. said it would raise the minimum hourly rate for U.S. employees to $9 in 2014 and $10 in 2015.

The raise will be enacted across all six of the retailer's brands and will affect about 65,000 store employees, the company said.

Gap's announcement comes amid a broader national debate about the minimum wage, sparked in part by President Barack Obama's push to raise the federal minimum wage as outlined in his State of the Union address in January.

Mr. Obama earlier this month signed an executive order to raise the minimum wage for employees of federal contractors to $10.10 an hour beginning Jan. 1, 2015, from the current federal minimum wage of $7.25, which hasn't been raised since 2009. Mr. Obama also urged Congress to increase the minimum wage for the whole country.

Gap, for its part, said this isn't a political issue, with Chief Executive Glenn Murphy saying its decision to invest in frontline employees "will directly support our business, and is one that we expect to deliver a return many times over."

Gap shares ended Wednesday at $41.19 and were flat in recent after-hours trading. Through the close, the stock has risen 29% in the last 12 months.

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