Costco’s average hourly wage is over $30. Here’s how that stacks up

Key Takeaways

• Costco now pays an average hourly wage of $30 an hour after its most recent wage increase, CEO Ron Vachris said Thursday.

• That puts Costco about $5.50 above the retail average in August, according to data from the Bureau of Labor Statistics.

• The retailer cites wages and its insider advertising policies as reasons for its high morale and low employee turnover.

New data from Costco Wholesale (COSTS) illustrates a key reason why the company is considered a good employer in the retail industry: wages are significantly above the national industry average.

During the company’s Thursday earnings conference call, CEO Ron Vachris said Costco’s average wage has reached “just north” of $30 an hour after a round of wage increases brought the minimum wage to $19.50 an hour and 50 cents per hour to each wage level.

Costco has long advocated that higher wages lead to more productive workers, which leads to higher sales. CFO Gary Millerchip said Thursday that wages are a “critical part of delivering a better experience for our members.”

Costco more than $5 above the store average

The warehouse retailer is about $5.50 above the store average of $24.57 per hour, as reported by the Bureau of Labor Statistics for August. Retail saw roughly the second-lowest average wage in the BLS data, at $24.02. That put it above just the hospitality industry at $22.18, with an average wage of more than $51 for utility workers.

Wages are one reason Costco has low employee turnover, along with its tendency to promote from within, which Vachris also highlighted in Thursday’s call. He said the company promoted 95 new warehouse managers in fiscal 2024, and 85% of those promotions were people who started as hourly workers at Costco.

According to BLS data, the total average private nonfarm wage in August was just under $34.

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