Costco raises its employees ’minimum wage to $ 16 an hour

Costco will increase its starting salary to $ 16 an hour, beating most of its main competitors.

Costco chief executive Craig Jelinek announced the increase Thursday at a Senate Budget Committee hearing, led by Sen. Bernie Sanders, to examine salaries at major companies. Jelinek said the starting salary for Costco employees would rise to $ 16 a week compared to the $ 15 the company instituted two years ago.

The initial salary scale places Costco above its competitors, including Amazon, Target and Best Buy, who have a minimum wage of $ 15. Walmart’s starting salary is $ 11 an hour.

Jelinek says higher wages would boost workers ’retention and productivity.

“I want to point out: this is not altruism,” Jelinek said. “At Costco, we know that paying employees good wages and providing affordable profits makes sense for our business and is a significant competitive advantage for us.”

Walmart and McDonald’s workers testified at the hearing to demand that these companies raise their minimum wage.

The federal minimum wage is currently $ 7.25.

Democrats are trying to pass a $ 1.9 trillion COVID-19 aid bill that would include a provision that would raise the federal minimum wage to $ 15 an hour for five years, a policy they strongly oppose. the Republicans.

That effort hit hard on Thursday when the Senate MP decided that the minimum wage provision should be removed from the bill, according to Democratic Senate advisers, who spoke on condition of anonymity because the decision had not been published.

A growing number of states have already raised the minimum wage to $ 15 an hour.

Costco’s announcement also comes when labor groups demand payment for dangerous living conditions for groceries and other essential works, which some companies offered at the start of the coronavirus pandemic and then ended.

Costco has continued to pay a $ 2 per hour premium to its workers per hour since March.

Jelinek said Costco would end the premium as the one-year mark approaches, but would convert part of it through wage increases on the pay scales.

Costco has 180,000 employees in the US. UU. Jelinek said more than half earn $ 25 an hour or more.