Costco's hourly workers are getting a raise — read the CEO's memo

• Costco hourly workers in the US, Puerto Rico, and Canada are getting raises later this month.
• Pay at both ends of the scale will increase by $1 per hour, CEO Ron Vachris said in a memo obtained by BI.
• The raise follows several increases in recent years as Costco tries to stay competitive on wages.

Costco has long been one of the highest-paying employers in retail — a reputation on track to continue as hourly workers in the US, Puerto Rico, and Canada are scheduled for raises later this month.

In a memo to employees on Monday obtained by Business Insider, CEO Ron Vachris said pay for service assistants, service clerks and meat cutters at both ends of the wage scale will increase by $1 per hour.

That brings the starting wage for those roles to $19.50 per hour — a gain of 5.4% for the lowest earners.

Vachris said the raises will take effect July 22 and are part of the company's "efforts to ensure our hourly wages remain highly competitive in the industry."

The median Costco employee made $50,202 in wages and benefits last year —better than those at Walmart, who earned $27,136, and Target, who earned $25,993.

Costco said in the memo that incremental steps on the wage scale, determined by seniority, will increase by 50 cents.

The company did not respond to BI's request for comment ahead of publication, but sources told BI the raise applies to nearly all hourly employees, with top-end clerks set to earn $30.90 per hour.

The raise follows several increases in recent years, including a 50-cent hike in March.

The wholesale club delivered two hikes in 2021, with then-CEO Craig Jelinek saying higher wages are "good business" that helps reduce turnover.

You can read the Costco CEO's memo to workers below:

Increases to Hourly Wage Scales
To: All U.S., Puerto Rico and Canada employees
From: Ron Vachris

As part of our continuing efforts to ensure our hourly wages remain highly competitive in the industry, effective July 22, 2024, we will adjust hourly wage scales for employees in the U.S., Puerto Rico and Canada as follows:

• Starting rates for Service Assistants, Service Clerks and Meat Cutters will increase by $1.00/hour.
• Top-of-scale rates for Service Assistants, Service Clerks and Meat Cutters will increase by $1.00/hour.
• All other steps on these hourly scales will increase by $0.50/hour.

Please contact your GM or Payroll Clerk with any questions. Thank you for all you do for Costco and for each other.

If you are a Costco worker who wants to share your perspective, please contact Dominick via email or text/call/Signal at 646.768.4750. Responses will be kept confidential, and Business Insider strongly recommends using a personal email and a non-work device when reaching out.