Costco Increases Pay to Over $30 Per Hour for Most Workers

Costco will raise hourly pay for most U.S. store workers to over $30. However, a start date to implement this pay raise has not yet been set.

According to Reuters, Costco plans to raise hourly wages for its top-of-scale employees over the next three years. The increase will start with a $1 raise in the first year, bringing the rate to $30.20, followed by an additional $1 per year for the next two years, per a company memo. This wage hike follows a recent vote by Costco Teamsters union members in favor of a nationwide strike as they entered the final stage of contract negotiations ahead of the Jan. 31 deadline.

Employees at the bottom of the scale will get a salary increase of 50 cents to $20. “With these changes, we believe our hourly wages and benefits will continue to far outpace others in the retail industry,” the company said in the memo signed by CEO Ron Vachris.

The company and the union that represents thousands of its workers are in negotiations over a new collective bargaining contract. The current contract is set to expire Jan. 31, 2025. Costco Teamsters, which represent less than 10% of the company’s roughly 219,000 employees in the U.S., has voted to authorize a strike, demanding better pay and benefits.

Costco’s Hourly Employees Typically Start Higher Than Minimum Wage

Costco to raise hourly pay for most US store workers to over $30 https://t.co/JJNYk9GlmZ

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Costco’s hourly U.S. employees typically start at a higher wage entry rate than most jobs before getting periodic increases based on their time with the company. It is believed that because of these higher wages, Costco has a low rate of worker turnover, and more than half of Costco’s hourly workers are in the top category.

Other benefits for non-union workers include an additional week of vacation after 30 years of employment. New employees are eligible for a vacation in their first year of work.

Costco may be leading the charge pay-wise, but other retailers are trying to catch up.

In February 2022, Target announced that it would increase its starting pay to a range of $15 to $24 per hour. The exact starting wage depends on the job and the local market.

In late 2023, Walmart raised hourly wages to $18 per hour. Walmart also offers a bonus program for hourly workers, with a maximum bonus of $1,000 for workers who have been at Walmart for 20 years or more.

In November 2024, Sam’s Club increased its minimum wage to $16 per hour and raised pay for all employees. Additionally, Bank of America raised its minimum wage to $24 per hour for all full-time and part-time hourly employees in the United States on Oct. 1, 2024.