An employee organizes Apple Inc. AirPods on sale at a Costco Wholesale Corp. store. of San Francisco, California.
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Costco raises its minimum hourly wage to $ 16, placing its starting wage above many of its rivals such as Amazon, Walmart and Best Buy.
“Two years ago, we moved our starting hourly wage to $ 15 everywhere in the United States Starting next week, the starting salary will reach $ 16,” Craig Jelinek, CEO of Costco, said during a hearing of the Senate Budget Committee on Thursday.
The retailer has more than 180,000 employees in the U.S. and 275,000 employees worldwide.
The move comes as Congress debates raising the federal minimum wage by $ 15 per hour as part of President Joe Biden’s $ 1.9 trillion Covid-19 relief bill.
Target and Amazon pay workers a minimum of $ 15 per hour. Walmart’s minimum wage starts at $ 11 an hour, but has recently announced increases of 425,000 employees that will increase the average retailer’s salary to more than $ 15 per hour. Walmart is the largest entrepreneur in the country.
Starting in March last year, the chain set a $ 2-per-hour premium for its employees to help cushion the financial stress the pandemic caused many people.
“As we approach the one-year mark of this extra pay, we will limit the temporary premium, but turn part of the premium into a permanent increase by increasing each step on the hourly wage scales,” Jelinek said.
Costco employees in the United States have been with the company for more than nine years on average, with more than 60% of its employees with an average of five years or more of service.
Costco has 803 locations worldwide, including 558 in 45 states in the United States, Washington and Puerto Rico.
The company was not immediately available to comment further on its decision.
Correction: The hearing took place on Thursday. An earlier version of this story misrepresented the date.