The pandemic has wreaked havoc on the retail industry, while big box chains like Walmart, Target, and Costco continue to come out on top. More retailers are bumping up their minimum wages to attract workers and comply with shifting legislations. Amazon ($AMZN) raised its starting wage to $15 in 2018, Target ($TGT) and Best Buy ($BBY) increased their minimums to $15 last year. Walmart ($WMT), the largest retailer in the country, has an $11 minimum wage, and announced last week that it plans to raise pay for 425,000 employees, a quarter of its workforce, to at least $13 an hour. But one chain is rising above the rest.
Costco ($COST) will raise its starting rate for hourly store workers in the United States — who make up about 90% of its US workforce — to $16 an hour beginning next week. Chief executive Craig Jelinek made the announcement today at a US Senate Budget Committee hearing on worker pay at large companies. The news comes a few days after the warehouse retailer said it will be administering COVID vaccines in select cities. Costco has been raising its minimum wage on a yearly basis since 2018. The company says 20% of its hourly employees make the minimum wage.
According to our data, COVID hasn't impacted Costco's hiring efforts. Since last February, over 5,000 people added Costco as their employer on LinkedIn. The company's total LinkedIn employee headcount has risen from 46,800 to 51,900 workers, an 11% increase. (Costco counts roughly 180,000 US employees, so LinkedIn only represents a fraction of its workers and new hires.)
Meanwhile, chains like Target and Walmart have increased their LinkedIn headcounts by 14% and 18%, respectively. 162,000 people list Target as their employer on LinkedIn, while 523,000 list Walmart. Amazon, the biggest pandemic winner, watched its LinkedIn headcount surge a whopping 60% over the last year. The (brutal, but typical) calculus is clear— the bigger the company, the bigger the workforce, the smaller the compensation for lower level employees. But Costco's hike will likely put pressure on competitors to match its $16 minimum.
Costco's move coincides with Democrats in Congress seeking support for a $15 federal minimum wage. Last month, Sen. Bernie Sanders introduced a bill to increase it to $15 by 2025. President Joe Biden has also affirmed his support for raising the federal minimum wage from $7.25 — which has been in place since 2009 — to $15.
About the Data:
Thinknum tracks companies using the information they post online, jobs, social and web traffic, product sales, and app ratings, and creates data sets that measure factors like hiring, revenue, and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales.
