Wal-Mart is raising wages for some 500,000 hourly employees because worker pride in the company is vital to running a good retail business, CEO Doug McMillon told CNBC on Thursday.
"We make wage adjustments all the time. We just decided this is a really good moment to be more bold," McMillon said in a "Squawk Alley" interview. "Right now we want to make sure everybody is crystal clear how vital our store experience is to our future."
McMillon spoke on CNBC after Wal-Mart announced that hourly workers will earn at least $1.75 above the the current federal minimum wage, or $9 per hour starting in April. By next February, they will earn at least $10 per hour.
McMillon said Wal-Mart is trying to position itself ahead of the market in order to retain the best talent available as the employment situation continues to improve.
"Today's cashier is tomorrow's store manager. Tomorrow's store manager may have my job, so we want to make sure that opportunity is there for people, as it has been for so many of us in the past," he said.
The National Employment Law Project's Tsedeye Gebreselassie called Wal-Mart's decision to raise wages a small step in the right direction.
"It's really not enough especially considering the company is so profitable, posting $16 billion in profit last year," she said in an interview with CNBC's "Power Lunch."
On top of that, she said, because Wal-Mart is the nation's largest private employer, it has a real obligation to do better.
Retail expert Jan Kniffen of J. Rogers Kniffen Worldwide applauded the move, and said it will cause other retailers to follow suit.
"Long term this is going to be a real positive for Wal-Mart. They're going to have better employees. They're going to have happier people. The federal government will be off their back. The state government is off their back. The local government is off their back," he said.
"Wal-Mart will no longer be the most hated retailer in America."