Costco raises its bare minimum wage in US to $16 an hour

By Nathaniel Meyersohn | CNN Business

Costco will elevate its starting up amount for hourly retailer personnel in the United States to $16 an hour, placing its setting up wage higher than rivals these types of as Amazon, Target and Very best Buy.

Costco has all-around 180,000 US staff, and 90% of them work hourly. It will hike its bare minimum wage to $16 starting up coming week, chief govt Craig Jelinek reported Thursday at a US Senate Spending budget Committee listening to on worker pay back at massive companies.

The shift arrives as Democrats in Congress seek out to rally guidance for a $15 federal least wage. Sen. Bernie Sanders is the driving power powering Congress’ present-day drive to raise the federal minimum amount wage, introducing a invoice last month to enhance it to $15 by 2025. President Joe Biden has also backed a $15 minimum amount wage. The federal minimum wage has stood at $7.25 an hour because 2009, but a developing variety of metropolitan areas and states are increasing their bare minimum wage.

Costco, centered in Issaquah, Washington, raised its minimum amount wage to $14 in 2018 and $15 in 2019. The company states 20% of its hourly staff make the minimum wage.

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Much more suppliers and cafe chains have also moved to a $15 an hour minimal price. Amazon lifted its starting wage to $15 in 2018, when Focus on and Greatest Obtain bumped up their minimums to $15 past year. Walmart, the biggest US retailer, has an $11 minimum wage, and it said last week that it planned to raise shell out for close to 425,000 staff members, a quarter of its workforce, to at least $13 an hour.

Arindrajit Dube, a professor of economics at the College of Massachusetts Amherst who research the minimal wage, stated Costco’s shift would set strain on rival businesses such as Amazon to match its $16 minimum.

Despite the fact that some organizations have moved to $15 an hour or higher than, numerous small business leaders oppose a $15 federal bare minimum wage. Some companies, notably tiny firms, have fought from increasing the minimum wage to $15, indicating it could prompt layoffs and even closures.