Baltimore Sun

Costco to raise starting hourly wage to $16

- By Alexandra Olson

NEW YORK — Costco will increase its starting wage to $16 an hour, surpassing most of its main competitor­s.

Costco CEO Craig Jelinek announced the increase Thursday at a Senate Budget Committee hearing, led by Sen. Bernie Sanders, I-Vt., to examine wages at major companies. Jelinek said the starting wage for Costco employees would rise to $16 next week, up from $15 the company instituted two years ago.

The starting wage scale puts Costco above competitor­s, including Amazon, Target and Best Buy, which have $15 minimum wages.

Jelinek saying the higher pay would bolster worker retention and productivi­ty.

“I want to note: This isn’t altruism,” Jelinek said. “At Costco, we know that paying employees good wages and providing affordable benefits makes sense for our business and constitute­s a significan­t competitiv­e advantage for us.”

Workers from Walmart and McDonald’s testified at the hearing to demand those companies raise their minimum pay. Walmart’s starting pay is $11 an hour.

The federal minimum wage is $7.25. Democrats have sought to increase the federal minimum wage to $15 an hour over five years, a policy strongly opposed by Republican­s.

That effort suffered a serious blow

Thursday when the Senate parliament­arian decided that a minimum wage provision must be dropped from the $1.9 trillion COVID-19 relief bill.

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

Costco’s announceme­nt also comes as labor groups are demanding hazard pay for grocery and other essential workers, which some companies offered at the beginning of the coronaviru­s pandemic and later ended.

Costco has continued to pay a $2 hourly premium to its hourly workers since March. Jelinek said Costco would end the premium as the one-year mark approaches but would convert some of it through increases in wages across pay scales.

Costco has 180,000 employees in the U.S.

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