Costco announces $16 minimum wage amid $15 debate in Congress
The hourly pay increase, effective next week, will make wholesale giant Costco the nation’s highest-paying retail chain.
As federal lawmakers are stalled on increasing the minimum wage to $15 by 2025, wholesale retail giant Costco has announced that next week, it will raise its employees’ salaries to $16 per hour.
The pay increase will make Costco the nation’s highest-paying retail chain.
Costco Chief Executive Officer Craig Jelinek made the announcement Thursday during a Senate Budget Committee hearing on worker wages. Jelinek said that providing a competitive pay rate “makes sense” for the business.
“We try to take care of our employees,” he told lawmakers, “because they play a significant role in our success.”
The $1 hike comes just over a year after Costco raised its minimum wage to $15 in 2019.
In speaking to Congress, Jelinek noted that while $16 is Costco’s new minimum wage, it is just that — the minimum. According to him, many of the retailer’s employees earn more than $25 an hour based on years of tenure and experience.
Senate Parliamentarian Elizabeth MacDonough ruled Thursday that the plan to gradually increase the federal minimum wage does not fit the rules of a budget debate and would not be part of the $1.9 trillion package that President Joe Biden has presented to Congress for coronavirus relief. It’s a setback but not surprising. The president said earlier this month he believed the minimum wage hike ultimately wouldn’t be included. Democrats, however, are still prioritizing it.
“We are not going to give up the fight to raise the minimum wage to $15 to help millions of struggling American workers and their families,” Senate Majority Leader Chuck Schumer said in a statement. “The American people deserve it, and we are committed to making it a reality.”
The minimum wage has been stuck at $7.25 since 2009, the longest stretch of sustained wages in U.S. history. Republicans have said that a $15 minimum wage would hurt small businesses. They have countered with a raise of the hourly wage to $10 by 2025.
A movement called Fight for $15 began in 2012 when more than 200 fast-food workers walked off the job in New York City in a demand for higher wages. The non-profit organization by the same name says it represents employees in more than 300 cities on six continents.
Sen. Bernie Sanders, who has long been a proponent of raising the minimum wage, tweeted the following Thursday: “Raising the federal minimum wage to $15 an hour would benefit 32 million workers and would give low-wage workers an extra $3,300 a year. I’ll say that again. Raising the minimum wage to $15 an hour would benefit 32 MILLION workers. Let’s get it done.”