By Angel González
Seattle Times, January 29, 2014
... On Wednesday, the day after his State of the Union address called for lifting the minimum wage for working Americans, the president chose to speak at a Costco in Maryland. The Issaquah-based company, he said, is proof that higher wages are “a smart way to boost productivity and to reduce turnover.” ...
The presidential visit underscores how Costco is gaining a prominent role in the growing national debate about income inequality.
The company is known for paying its workers well — an average $20.89 per hour for its hourly employees. Starting salaries at its warehouses amount to $11.50 an hour, said Chief Financial Officer Richard Galanti, well,above the federal minimum of $7.25.
Costco’s executives are also famous for taking home less than those in competing companies at a time when executive salaries have skyrocketed and average wages have stagnated in the face of global competition. ...
Many of the company’s shareholders, who saw Costco profits grow even as other retailers suffered through the recession, seem happy with the approach.
In a recent securities filing, shareholder Davis Advisors said Costco’s culture, as led by its board of directors, “has been a core element of the longterm success of the company in part because it inhibits any temptation to take actions (like raising prices or cutting store-employee pay and benefits) that might temporarily boost earnings and stock price” at the expense of long-term value. …
Copyright 2014 Seattle Times