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

By Nathaniel Meyersohn | CNN Organization

Costco will increase its commencing fee for hourly keep personnel in the United States to $16 an hour, placing its starting up wage over rivals this kind of as Amazon, Focus on and Greatest Obtain.

Costco has all around 180,000 US staff, and 90% of them work hourly. It will hike its least wage to $16 commencing future week, chief executive Craig Jelinek explained Thursday at a US Senate Finances Committee hearing on employee pay at massive corporations.

The shift arrives as Democrats in Congress look for to rally support for a $15 federal minimal wage. Sen. Bernie Sanders is the driving power driving Congress’ present-day drive to elevate the federal bare minimum wage, introducing a monthly bill past thirty day period to maximize it to $15 by 2025. President Joe Biden has also backed a $15 bare minimum wage. The federal minimal wage has stood at $7.25 an hour considering that 2009, but a expanding number of towns and states are elevating their minimum amount wage.

Costco, based in Issaquah, Washington, elevated its bare minimum wage to $14 in 2018 and $15 in 2019. The corporation says 20% of its hourly workers make the minimal wage.

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Much more suppliers and restaurant chains have also moved to a $15 an hour minimal rate. Amazon raised its setting up wage to $15 in 2018, when Concentrate on and Most effective Purchase bumped up their minimums to $15 last calendar year. Walmart, the major US retailer, has an $11 bare minimum wage, and it mentioned past week that it prepared to raise pay back for all over 425,000 workers, a quarter of its workforce, to at least $13 an hour.

Arindrajit Dube, a professor of economics at the University of Massachusetts Amherst who reports the minimum amount wage, claimed Costco’s go would put stress on rival employers these types of as Amazon to match its $16 least.

Although some companies have moved to $15 an hour or earlier mentioned, many enterprise leaders oppose a $15 federal minimum amount wage. Some businesses, especially little firms, have fought against elevating the minimum wage to $15, declaring it could prompt layoffs and even closures.