(AP) – 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, 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 year ago.
The starting wage scale puts Costco above competitors, including Amazon, Target and Best Buy, which have $15 minimum wages. Walmart's starting pay is $11 an hour.
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.
The federal minimum wage is currently $7.25. Democrats are trying to push through a $1.9 trillion COVID-19 relief bill that would include a provision hiking 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 the minimum wage provision must be dropped from the bill, according to Democratic Senate aides, who spoke on condition of anonymity because the decision hadn't been released.