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Pay hikes shows market can decide wages: Engler

Decisions by Wal-Mart and Aetna to raise pay show that markets are capable of determining the appropriate wages, John Engler, president of the Business Roundtable told CNBC on Monday.

"There is particularly, I think, today a premium on talent," the former Michigan governor said in a "Squawk Box" interview. "But there is also on the part of companies, I think, a desire to retain their workforce. That was what Aetna said, and Wal-Mart was sort of hinting at the same thing. We want to build our own, grow them, and train them."

Engler was responding to a question about whether government should step in to mandate a higher minimum wage.

Last week, Wal-Mart announced that it would increase pay for some 500,000 employees to $9 per hour by April, followed by another raise to $10 an hour by next February. Aetna said last month it would hike base pay to $16 per hour and offer expanded benefits.