Costco Raises Minimum Wage to $15 an Hour -- Update
March 18 2019 - 6:20PM
Dow Jones News
By Sarah Nassauer and Micah Maidenberg
Costco Wholesale Corp. said it has raised starting wages for
store workers to $15 an hour, as a tight U.S. labor market
continues to drive fierce competition for hourly staffers.
Executives at the Issaquah, Wash.,-based retailer, which has
around 245,000 workers, said the company raised its minimum hourly
wage for U.S. workers from $14 and for Canadian staff from $14 or
$13, depending on the province, this week. It is the second such
increase in less than a year at the company, which raised its
hourly minimum from $13 last June in the U.S.
Costco will also increase pay for supervisors and has started
offering paid parental leave for hourly employees, said chief
financial officer Richard Galanti on a conference call to discuss
quarterly earnings Thursday.
Several large employers have been raising pay to lure or keep
hourly and part-time workers in a hot job market where unemployment
recently touched its lowest level in decades.
Last year, Amazon.com Inc. raised its minimum U.S. wage to $15
an hour. Target Corp., which pays store workers at least $12 an
hour currently, has promised to pay $15 starting next year. Walmart
Inc., the biggest private U.S. employer with about 1.5 million
workers, raised its starting wage to $11 last year.
The median worker at Costco was paid $38,810 last year, compared
with $19,177 at Walmart and $28,446 at Amazon. ( See how your
salary compares.)
Costco reported total revenue of $35.39 billion in the quarter
that ended Feb. 17, compared with $32.99 billion the year
earlier.
Same-store sales, or those generated at Costco warehouses and
e-commerce sites operating for more than a year, rose 5.4%, boosted
by 4.9% more traffic to stores and websites. Sales of fresh food
and everyday household items were strong during the quarter, said
Mr. Galanti. Online sales rose 20.2%, he said.
The company reported a profit of $889 million, or $2.01 a share,
compared with $701 million, or $1.59 a share, the year prior.
Analysts had forecast $1.69 a share, according to FactSet.
Costco shares rose 5% in after-hours trading. The stock is up
6.4% so far this year.
Write to Sarah Nassauer at sarah.nassauer@wsj.com and Micah
Maidenberg at micah.maidenberg@wsj.com
(END) Dow Jones Newswires
March 18, 2019 18:05 ET (22:05 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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