Friday, May 30, 2014

Costco employees are happy employees

Retail Company Are Really Happy With Their Pay

CREDIT: Shutterstock

By Bryce Covert May 25, 2014 at 11:57 am Updated: May 25, 2014 at 12:06 pm

In an analysis of employee feedback shared on Glassdoor over the past year, just one retailer comes in the top 25 for top marks on pay and benefits: Costco.

In fact, the company is ranked at number two on the list, although has the same rating — 4.4 — as the top rated company, Google. It also beats out some big tech companies, which are often thought of as paying well and giving workers good perks, like Facebook, Adobe, and Microsoft.

Costco has become known for paying its workers more than is typical in the retail sector, where median pay is $10.29 an hour. Its starting pay is $11.50 an hour and even the lowest paid positions report on Glassdoor that they make $11.80 on average. Across all positions, its average pay is nearly $22. It also offers benefits, with 88 percent of employees enrolled in company-sponsored health insurance.

On top of that, it offers significant room for advancement: 70 percent of its warehouse managers, who can expect to make about $22 an hour on average, started in the company’s lower ranked positions. This engenders high levels of worker loyalty, as its turnover rate is just 5 percent for those who have been there for more than a year.

All of this is significant given the working conditions at one of its competitors, Walmart’s Sam’s Club. Walmart is instead known for low pay, where workers make just $8.81 per hour on average, according to IBIS World. (Glassdoor says the average for a sales associate is $8.86.) Only about half of its employees get company-sponsored health care. In fact, Walmart workers make so little and get so few benefits that at just one store they have to rely on about $1 million in public assistance each year to get by.

Rather than reporting low turnover and high satisfaction, Walmart employees have held a series of strikes, beginning with a massive walk out on Black Friday in 2012 that saw 400 striking workers and continuing with nine strikes in November of last year from California to Florida. Workers have been demanding that it pay them at lest $25,000 a year, give full-time positions to those who want them, and end retaliation against those who speak up.

The differences in pay and benefits don’t just impact workers’ views of the companies. It may have an impact on the businesses themselves. Walmart was recently downgraded by a financial analyst for understaffing, among other things, a problem the company itself has previously recognized as consumers shunned its empty shelves and sales took a hit. Costco’s sales, meanwhile, beat expectations two months in a row and were up 6 percent over last year in January. The company gets much more revenue and profit per employee.

10 Mind-Blowing Facts About Costco:

This is an oldie from 2005 but a goodie from the New York Times:
How Costco Became the Anti-Wal-Mart