March 6, 2013 by David K. Sutton
Costco CEO Craig Jelinek Says Raise The Minimum Wage
It is well-known that Costco CEO Craig Jelinek takes a different approach when it comes to employee compensation and retention. He’s one CEO who values employee commitment, and there’s no better way to retain dedicated employees than to pay them what they are worth. Today Jelinek threw his support behind the Fair Minimum Wage Act of 2013, which would raise the federal minimum wage to $10.10 per hour.
“At Costco, we know that paying employees good wages makes good sense for business,” Jelinek said in a statement. “We pay a starting hourly wage of $11.50 in all states where we do business, and we are still able to keep our overhead costs low.”
“An important reason for the success of Costco’s business model is the attraction and retention of great employees,” Jelinek added. “Instead of minimizing wages, we know it’s a lot more profitable in the long term to minimize employee turnover and maximize employee productivity, commitment and loyalty. We support efforts to increase the federal minimum wage.”
Costco has a reputation for paying its employees above market rate, with the typical worker earning around $45,000 in 2011, according to Fortune. Walmart-owned Sam’s Club, in contrast, pays its sales associates an average of $17,486 per year, according to salary information website Glassdoor.com.
Are CEO’s at other large companies incapable of running their businesses as efficiently as Jelinek? What’s wrong with them? Is it greed or incompetence that leaves their employees earning less than they are worth?