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Costco raising hourly wages to over $30 as union strike looms

By
Published  January 31, 2025 6:31pm PST
Consumer
FOX TV Digital Team

History of Costco

Here's how Costco, the world's largest warehouse membership club, came to be.

The Brief

    • Costco will raise wages, with top-tier employees earning over $30 an hour by 2027 and entry-level pay increasing to $20.
    • The hike comes amid labor tensions, as 18,000 unionized workers voted to authorize a strike.
    • Union leaders call it a reaction to worker pressure, not a proactive move by Costco.

LOS ANGELES - Costco has announced pay raises for most of its hourly workers, with top-tier employees set to earn over $30 an hour by 2027, According to a memo obtained by Reuters.

The move comes as union negotiations intensify ahead of a looming strike deadline.

According to the memo, the wage increase will roll out over the next three years, with an initial $1 raise this year, bringing the highest hourly pay to $30.20. Lower-tier employees will also see a 50-cent increase, raising their minimum hourly wage to $20.

RELATED: Costco strike looms: What it means for shoppers

What this means for Costco workers

By the numbers:

  • Top-tier employees will receive a $1 pay increase each year, reaching $32.20 by 2027.
  • Entry-level workers will see a 50-cent raise, bringing their hourly wage to $20.
  • Costco employs over 300,000 workers globally, with more than 18,000 union members under Teamsters representation.

The pay increase puts Costco among the highest-paying major retailers. However, union leaders argue that the raise doesn’t go far enough given the company’s record-breaking profits.

Customers shop at a Costco Wholesale store on January 31, 2025 in Chicago, Illinois. (Photo by Scott Olson/Getty Images)

Why is a Costco strike possible?

Big picture view:

The wage hike comes as negotiations between Costco and the Teamsters union approach a critical deadline. Earlier this month, 85% of unionized Costco workers voted to authorize a strike if a fair contract isn’t reached.

Teamsters spokesperson Matthew McQuaid dismissed Costco’s pay increase as a reaction to union pressure.

"Don’t be fooled by Costco’s fake generosity. This is not a worker-friendly company — it's a company that’s terrified of worker power," McQuaid said.

The union is pushing for better pay, stronger benefits, and improved working conditions, claiming that the current offer doesn’t fairly reflect the company’s massive profits.

ConsumerNews