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Key Takeaways
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Costco now pays an average hourly wage of $30 per hour after its most recent round of raises, CEO Ron Vachris said Thursday.
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That puts Costco roughly $5.50 above the retail average in August, according to data from the Bureau of Labor Statistics.
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The retailer credits wages and its policy of promoting from within as reasons for high morale and low employee turnover.
Fresh data from Costco Wholesale (COST) illustrates a key reason it’s thought of as a good retail employer: Its wages are substantially above the national industry average.
On the company’s Thursday earnings conference call, CEO Ron Vachris said Costco’s average wage has reached “just north” of $30 per hour after a round of wage increases brought its minimum wage to $19.50 per hour and added 50 cents per hour to each pay tier.
Costco has long advocated the nation that higher wages lead to more productive employees, which leads to higher sales. CFO Gary Millerchip on Thursday said wages are a “critical part of delivering a better experience for our members.”
Costco Over $5 Above Retail Average
The warehouse retailer is roughly $5.50 above the retail average of $24.57 per hour as reported by the Bureau of Labor Statistics for August. Retail broadly saw the second lowest average wage in the BLS data at $24.02. That put it above only hospitality at $22.18, with an average wage over $51 for workers in the utilities sector.
Wages are one reason Costco has low employee turnover, along with its tendency to promote from within, which Vachris also highlighted in Thursday’s call. He said the company promoted 95 new warehouse managers in fiscal 2024, and 85% of those promotions were people who started as an hourly worker at Costco.
The overall average private nonfarm wage in August was just under $34, according to the BLS data.
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