NEW YORK (AP) – Costco will increase its starting salary to $ 16 per hour, surpassing most of its main competitors.
Costco CEO Craig Jelinek announced the increase Thursday at a meeting of the Senate Budget Committee, chaired by Senator Bernie Sanders, to examine the salaries of large companies. Jelinek said the initial salary for Costco employees will increase to $ 16 next week, up from $ 15 set by the company two years ago.
The initial salary scale places Costco above competitors, including Amazon, Target and Best Buy, who have minimum wages of $ 15. Walmart’s initial payment is $ 11 per hour.
Jelinek said higher wages would increase workers’ retention and productivity.
“I want to note: this is not altruism,” Jelinek said. “At Costco, we know that paying well-paid employees and providing affordable benefits makes sense for our business and is a significant competitive advantage for us.”
Workers at Walmart and McDonald’s testified at the meeting to ask those companies to raise their minimum wage.
The federal minimum wage is currently $ 7.25. Democrats are trying to promote a $ 1.9 trillion COVID-19 aid bill, which would include a provision to raise the federal minimum wage to $ 15 an hour for five years, a policy strongly opposed by Republicans.
The effort suffered a severe blow on Thursday, when the Senate parliamentarian decided that the minimum wage should be removed from the project., according to the assistants of the Democratic Senate, who spoke on condition of anonymity, because the decision had not been published.
An increasing number of states have already raised the minimum wage to $ 15 an hour.
Costco’s announcement also comes as workers’ groups demand payment for food and other essential risks, which some companies offered at the beginning of the coronavirus pandemic and later ended.
Costco continued to pay a $ 2 per hour premium to its March hourly workers. Jelinek said Costco will end the premium as the one-year mark approaches, but will convert some of it through salary scales.
Costco has 180,000 employees in the United States. Jelinek said more than half earn $ 25 an hour or more.