BUSINESS NEWS FEBRUARY 18TH, 2016
WALMART WORKERS TO GET A RAISE
The supermarket chain has announced that it will be boosting its minimum wage from $9 an hour to $10 per hour. However, minimum wage workers are not the only ones affected. Full time workers will see their average hourly wage hiked by approximately 3% and part timers will see a wage increase of about 6%. These changes are projected to cost Walmart an extra $1.5 billion, on top of the $1.2 billion that came about as a result of wage increases last year. Despite these increases, Walmart remains the target for criticism in the debate over increasing minimum wage. Senator Bernie Sanders has repeatedly attacked Walmart in his speeches.
WHAT MAKES YOU MIDDLE CLASS?
While Bernie Sanders and Hillary Clinton have always drawn the line for middle class at a household income of $250,000, data from the U.S. Census Bureau suggests otherwise. In 2014, an income of $206,000 got you into the top 5% of earners. Data showed that the average middle class American had an annual salary of $53,700. While $250,000 a year isn’t the defining number for middle class, it has been used since 1992, under the presidency of BIll Clinton. Obama has used it in planning his tax reforms. Despite this precedent, Martin Sullivan, chief economist with Tax Analysts, says $250,000 is an arbitrary figure. So what truly defines middle class?
IBM TO BUY TRUVEN HEALTH
International Business Machine, otherwise known as IBM, is set to buy Truven Health Analytics, a company which gathers and analyzes healthcare data, for $2.6 billion. This is IBM’s fourth healthcare related purchase in the last year. IBM says that the purchase will attract nearly 9,000 clients to its Watson Health portfolio, which was released in April 2015. Deborah DiSanzo, general manager of Watson Health says that Truven will make IBM the world’s leading provider in the field of healthcare data and analytics.
WALL STREET SLUMPS
After a three day surge in stocks, Wall Street slowed down on Thursday after oil stocks dropped once again and Walmart slumped. Seven out of ten sectors of the S&P index dropped, led by the financial sector which dipped 0.7%. The biggest drag on the Dow index came from supermarket chain Walmart, which dropped 4% to just $63.46 a share. Walmart’s drop was slightly counteracted by IBM’s jump of 5.4%. Ryan Larson, head of U.S. Equity Trading at RBC Global Asset Management thinks this is “somewhat of a day of pause” and that the drop is mostly due to “short covering”.