Tags: Community & Outreach, Government & News & Crime
January 13, 2014With Costco Wholesale moving forward with a Cumming location, social media lit up with enthusiasm.
Local realtors, loyal shoppers and those looking for a place to work rejoiced with hundreds of shares and comments.
In my years covering community news, I have never seen a retail store cause so much excitement.
On the other hand, when plans for a third Walmart location in south Forsyth County were announced last year, the joy was not as fervent.
What makes a Costco so much more desired than a Walmart?
Even though both retailers offer customers low prices on merchandise, I think there’s a lot to be said about employee satisfaction (and free samples).
While Costco is the second-largest retailer in the U.S. behind Walmart, workplace happiness at Costco remains high; while Walmart keeps making national headlines with workers asking for better pay and more benefits.
Costco’s hourly workers average $21 an hour, and starting pay is about $11.50 per hour.
Walmart has said the average wage for its full-time employees in the U.S. is $12.67 per hour, with starting pay at about $8.50. The state’s minimum wage is $7.25 an hour.
Some Wall Street analysts have said Costco is overly generous, not only to customers but to its workers as well. But in the last five years, Costco has grown 39 percent and its stock price has doubled since 2009.
Craig Jelinek, Costco’s chief executive officer, told Bloomberg News last summer that people need to make a living wage with health benefits.
“It also puts more money back into the economy and creates a healthier country,” Jelinek said. “It’s really that simple.”
I don’t think Jelinek is saying minimum wage should be $18 per hour, but paying a higher wage can be a good business model, history has shown.
In 1914, Henry Ford, founder of Ford Motor Company, started an industrial revolution by more than doubling wages to $5 from about $2.38.
A mere $5 in 1914 had the buying power equal to $116 in today’s market, according to the Bureau of Labor Statistics inflation calculator. The first cars Ford had built in number, the 1903 Model N, cost about $3,000, or $70,000 in today’s money.
Henry Ford saw the advantages of paying a high wage for productivity, and yes, sales.