In a notable move reflecting changing labor market dynamics, Costco announced plans to increase wages for hundreds of thousands of workers, with top-scale clerks set to earn $31.90 per hour starting March 2024.
The retail giant, employing 272,000 people across the U.S. and Canada, will implement hourly increases ranging from 50 cents to one dollar. Top-scale assistants will see their wages rise to $30.20 per hour, while entry-level clerks and assistants will earn $21 and $20 per hour respectively.
The wage increases come as part of a three-year employee agreement, which includes additional $1 hourly increases scheduled for March 2026 and March 2027. The company is also enhancing benefits, offering vacation time to new employees in their first year and providing six weeks of time off for workers with 30 years of service.
This wage adjustment occurs against the backdrop of ongoing negotiations between Costco and the Teamsters union, representing 18,000 workers across six states. The union has authorized a strike, demanding better compensation that reflects the company's strong financial performance. Costco reported $254 billion in revenue for its latest fiscal year, with net income of $7.3 billion - double its 2019 profits.
The retailer maintains a strong track record in employee retention, with approximately 93% of workers staying with the company beyond their first year in the U.S. and Canada. This latest wage increase builds upon earlier improvements, including a July 2024 boost that raised entry-level positions to $19.50 per hour.
Ron Vachris, Costco's president and CEO, emphasized the company's commitment to competitive compensation, stating their wages and benefits "will continue to far outpace others in the retail industry."
The wage increases at Costco represent a departure from decades of wage stagnation across many sectors, potentially setting new standards for retail worker compensation in an evolving labor landscape.