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.
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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.
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“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.
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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.”
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