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The Lakewood Times

Costco Proves That Paying Employees a Fair Wage Makes Good Business Sense

3/12/2013

2 Comments

 
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Costco is proving Republicans and Wal-Mart wrong by paying workers a living wage while also earning record profits.

While Wal-Mart experienced February sales that were considered, a “total disaster,” Costco’s earnings for the second quarter of the year climbed 39%. The New York Times reported, “Costco Wholesale’s net income for its second quarter climbed 39 percent as it pulled in more money from membership fees, sales improved and it recorded a large tax benefit.”

Costco CEO Craig Jelinek openly supports raising the minimum wage to $11.50 an hour, “At Costco, we know that paying employees good wages makes good sense for business. We pay a starting hourly wage of $11.50 in all states where we do business, and we are still able to keep our overhead costs low. An important reason for the success of Costco’s business model is the attraction and retention of great employees. Instead of minimizing wages, we know it’s a lot more profitable in the long term to minimize employee turnover and maximize employee productivity, commitment and loyalty. We support efforts to increase the federal minimum wage.”

Costco is proof that the Republican idea that labor must be stomped on in order for our economy to prosper is wrong. It is possible for companies to earn record profits while respecting their workers and paying them a living wage. Wal-Mart embodies the conservative ideology that the country functions best when wealth is concentrated at the top. To match the Walton family’s fortune, an average Wal-Mart employee would have to work for the company for 7 million years. This model is what Republicans are advocating for the entire country, and it is failing to lead to prosperity.

Given Costco’s record profits, Wal-Mart’s blaming of the payroll tax and gas prices for their decline in sales doesn’t wash. Costco’s customers also faced higher gas prices and payroll taxes, but their sales were up six percent during the first quarter of the year.

Despite what both Wal-Mart and Republicans have been saying, companies can prosper and still have a conscience. When companies pay a living wage, workers benefit. When workers make more money, they spend more money. When people spend more money, the economy is stronger. When the economy is stronger, the nation as a whole benefits.

2 Comments
lakewooder
3/12/2013 12:07:36 pm

its obvious a democrat wrote this bias article , while I think Costco is a great place to shop ,blaming republicans for th ills of the economy could be nothing further from the truth ,if they keep on insisting on raising taxes and handing out millions to those who let the government run their lives how long can this country sustain those socialistic adgenda's before running out of other peoples money

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Jon Teske
3/24/2013 01:55:31 am

Guess what? If all businesses paid a living wage, more people would be paying more taxes and less people would be on assistance. Everybody's taxes would go down and we'd all be better. Guess what else? Republicans consistently vote for measures that allow businesses like Wal Mart to subsidize their profits on the backs of the taxpayers. For the record, I have no party affiliation, just the ability to see who's wrong.

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