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CONSHOHOCKEN, Pa. – IKEA on Tuesday joined the ranks of retailers boosting minimum hourly wages to remain competitive as a national labor shortage continues to shrink the available labor pool ahead of the holidays.

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The Scandinavian chain store confirmed it will hike its starting U.S. wage to $16 per hour on Jan. 1, boosting its average companywide hourly pay to $20.

IKEA’s average starting hourly wage for entry-level roles in the United States had been $14.79, The New York Times reported.

>> Related: Macy’s to boost hourly minimum wage to $15 by May 2022

In addition to the wage increase, the company also confirmed that it has enhanced its comprehensive benefits package to include a “minimum of five weeks of paid time away from work for all employees, education assistance, back-up child and adult care, and more inclusive health care benefits.”

Tuesday’s news came on the heels of a recent announcement that IKEA will offer bonuses to those working for the company on Aug. 31 who are still employed when the new year begins.

That bonus is expected to total $900 for full-time employees, and it will be prorated for part-time employees based on the hours they work, the Times reported.

“I am proud of everything we have accomplished over the past year, and we will continue to seek opportunities to grow our compensation and benefits offer and share our success with our co-workers,” Javier Quiñones, CEO and chief sustainability officer for Conshohocken, Pennsylvania-based IKEA U.S., said in a prepared statement.

A nationwide labor shortage, fueled by the COVID-19 pandemic, has spurred retailers in 2021 to raise wages and provide more benefits as competition for available workers heightens. Macy’s currently employs about 100,000 people in the United States, Reuters reported.

In September, Inc. said it had increased its average U.S. starting wage to more than $18 an hour, while Walmart Inc. has also touted raises.