Costco plans to increase its minimum wage to $16 per hour commencing in the upcoming week. According to Chief Executive Officer Craig Jelinek on Thursday, this will pay above most of its key competitors.

Costco to Hike Up Minimum Wage

CEO Craig Jelinek stated in a meeting with lawmakers, "Two years ago, we moved our starting hourly wage to $15 everywhere in the U.S. Effective next week, the starting wage will go to $16," reported News Break.

The meeting was a Senate Budget Committee hearing, spearheaded by Sen. Bernie Sanders, to evaluate major companies' wages. Jelinek remarked that Costco employees' starting wage would hike up from the $15 that the company instituted two years ago.

Walmart also declared major changes to employee wage increases on February 18. The company said it would raise wages for around 425,000 employees to between $13 and $19 per hour, reported Washington Examiner.

Competitors, including Target, Amazon, and Best Buy, have $15 starting wages. Walmart's minimum wage is $11 per hour.

Jelinek stated that the higher salary would increase productivity and worker retention. According to the CEO, "I want to note: this isn't altruism. At Costco, we know that paying employees good wages and providing affordable benefits makes sense for our business and constitutes a significant competitive advantage for us," reported The Epoch Times.

Congress is taking on whether to increase the federal minimum wage limit to $15 per hour. The measure could be included in President Joe Biden's $1.9 trillion economic relief bill. It is currently pending the Senate parliamentarian's decision on the subject.

Walmart and McDonald's workers testified at the hearing to demand those companies to increase their minimum salary. The federal minimum wage currently stands at $7.25.

Also Read: $1,400 Stimulus Checks to Be Voted on Friday, Gets Unprecedented Push

The president supports a federal measure to bolster the minimum wage. However, the latest statement from White House chief of staff Ron Klain suggested the administration would not make efforts to overrule the Senate parliamentarian if she decides to remove the wage raise from the spending bill.

Costco is based in Issaquah, Washington. It hires more than 180,000 people in the U.S.

According to Jelinek, "It takes a lot of time to interview, find employees, lot of labor involved just trying to hire individuals. We want people to stay with us. In my past experience, wages usually don't put people out of business. How you run your business will put you out of business."

The most recent announcement of wage increase from shops including Costco and Walmart also possibly seek competitive advantages between their online retail counterpart Amazon. Amazon raised its minimum wage for employees to $15 per hour in 2018.

Democrats are making efforts to push through a $1.9 trillion COVID-19 relief bill that would include a provision hiking the federal minimum wage to $15 per hour in the course of five years. Republicans adamantly oppose this policy.

However, such efforts suffered a serious blow on Thursday when the Senate parliamentarian denounced the bill's minimum wage provision. This was according to Democratic Senate aides, who spoke on condition of anonymity because the ruling has yet to be released.

Related Article: House Democrats Reveal a $1.9 Trillion COVID-19 Relief Bill That Includes Minimum Wage Increase