Motley Moose – Archive

Since 2008 – Progress Through Politics

A Tale of Two Companies

“Could Costco make more money if the average wage was $2 or $3 lower?” Richard Galanti, Costco’s chief financial officer, mused in an interview with Businessweek. “The answer is yes. But we’re not going to do that.”…  

Imagine that … a company that recognizes that paying decent wages takes priority over corporate profits.  The shock to me, having known that CostCo paid more, was just how much CostCo on average does pay.

From the same article:

The average Costco worker made about $45,000 per year, Fortune reports. By comparison, Walmart-owned Sam’s Club, a Costco competitor, pays its workers $17,486 per year, according to salary information site

I work in IT and I don’t make $45,000 per year; not even close.  I’m gonna cry.

Costco’s insistence on treating its workers well hasn’t come at the expense of the company’s bottom line. The retailer’s profit jumped 19 percent to $459 million last quarter, while Walmart’s sales suffered during the same period.

Walmart’s PR department has had to work overtime in recent months as the discount retailer was tied to both fires at factories in Bangladesh and showed a marked insouciance toward same and then did not support efforts to improve conditions at other factories.  There have also been stories on the state of Walmart stores, specifically being dirty and poorly stocked.

And one of my Senators, Sanders, frequently points out that the Walmart heirs own more wealth than more than 40% of Americans.

Six members of the Walton family appear on the Forbes 400 list of the wealthiest Americans. Christy Walton, widow of the late John Walton, leads the clan at No. 6 with a net worth of $25.3 billion as of March 2012. She is also the richest woman in the world for the seventh year in a row, according to Forbes. Here are the other five:

No. 9: Jim Walton, $23.7 billion

No. 10: Alice Walton, $23.3 billion

No. 11: S. Robson Walton, oldest son of Sam Walton, $23.1 billion

No. 103: Ann Walton Kroenke, $3.9 billion

No. 139: Nancy Walton Laurie, $3.4 billion

That’s a grand total of $102.7 billion for the whole family.…  

 photo 058_zps7f258705.jpg  stolen from Betty Cracker at Balloon Juice

Of course, some would say that I’m jealous to point out how unfair it is for folks who did nothing but be born or were lucky enough to marry into a certain family and who make their money on the backs of low income workers both here and abroad.  Walmart sells cheap crap made by workers in other countries with little worker protection and sold by workers here and in other countries who cannot afford to buy the products they sell.

A Walmart is opening in the coming months just up the road from me.  Vermont hasn’t allowed “super” Walmarts but “enhanced” ones in the past.  I know nothing about this one other than I won’t step foot on its property.  If I can’t afford to buy something elsewhere I won’t buy it at all.


  1. HappyinVT

    I didn’t mean to put this on the front page.  It doesn’t meet the rules but I don’t know how to get it off.

  2. pittiepat

    about its employees.  If you haven’t already seen it, CNBC has a documentary about Costco, about how its stores are run and how decisions are made on what to stock.  You have considerably less product choices than Walmart or Sam’s but that didn’t really bother me.  Just knowing I was shopping in a place where the employees are treated well and who are paid sufficiently  (and benefits given) that they are not forced to reply on public assistance for healthcare.  There are a number of things about Walmart which infuriate me, but close to the top of the list is the inability of their employees to afford healthcare.  That greedy family can well afford to pay their employees a living wage without making much of a dent in their bottom line.

  3. Avilyn

    And I won’t set foot in Walmart/Sam’s club either.  Companies that pay livable wages & take care of their employees should be rewarded with my business as much as possible.  I like shopping at Wegmans for the same reason (although I wish they had a location more convenient to me).

  4. First Quarter Of 2013 Saw Largest Wage Drop Ever

    The first three months of 2013 saw wages fall 3.8 percent – the largest drop in hourly pay in the 65-year history of that statistic – despite an increase in worker productivity. With high unemployment freeing employers from fears that their employees will turn elsewhere, the U.S. recovery has been marked by a decoupling of rising productivity from stagnant wages.

    The gloomy milestone partly reflects the predominance of low-wage service jobs in the slow, steady streak of job growth since the recession. Increasing the minimum wage, as progressives in Congress hope to do, could help counter downward wage pressures at the bottom of the earnings ladder.

  5. Walmart’s Low Wages Cost Taxpayers Millions Each Year

    Due to low wages and few benefits, Walmart workers at a single 300-person Supercenter store rely on anywhere from $904,542 to $1,744,590 in public benefits per year, costing taxpayers, according to a new report from the Democratic staff of the House Committee on Education and the Workforce.

    The report focused its analysis on Wisconsin, because the state’s data is the most comprehensive and up to date. It looked at how many workers enroll in the state’s Medicaid program and extrapolated how many services they rely on from programs such as the Supplemental Nutrition Assistance Program, Earned Income Tax Credit, school lunch program, Low Income Home Energy Assistance Program, and Section 8 housing vouchers, among others.

    Buy at Walmart and get cheap stuff? Well, not exactly.

  6. Lightbulb

    They also have regular schedules for their employees. Most other big retail insists upon “open availability”, which means you might get your schedule less than 12 hours in advance. Some bosses in the rest of retail give you about an hour notice, and clopening in rampant.

    Costco minimizes clopening as much as they possibly can.

    Clopening is very common in both retail and fast food workspaces. It’s when management is so incompetent with scheduling that they force rank/file staff to be available for closing time(say, 10PM) but then be available pre-opening (say, 4AM) the next day.

    So, yes, Costco is excellent in many ways.

  7. JG in MD

    right up the street from me.

    I went to Wal-Mart the other day and I feel guilty every time I do it, but I have to buy inexpensively. I also have to buy in small quantities for a household of one person and two cats. And because of that I don’t know if I could save enough to pay the Costco annual fee.

    One of the many problems of being poor is that often you can’t act as your conscience dictates.

  8. virginislandsguy

    Most media attention has been on Jim Sinegal as the public face of Costco. But Jeff Brotman is the cofounder and Chairman of the Board and deserves some credit for their policies.

    I worked for a small stereo company back in the early ’70s. Jeff was the attorney for them and I met him a bunch of times. Even though I was just a 20 something flunky, he treated me with dignity at all times. Cool guy.

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