Costco’s Respect for Its Workers Wins Obama’s Respect for Costco
Costco (NASDAQ:COST) is President Obama’s retailer of choice. Why? The company’s wage and employee practices mirror what the president encourages in terms of employee management — closing the gap between the wealthy and the poor. Obama is set to hit Costco Wednesday morning, the day after his state of the union speech, and there he is expected to praise Costco’s wage practices and highlight the store as a good example of what other retailers should follow.
Market Watch reported on Obama’s visit Monday and explained the differences between big-box retailers like Costco and Wal-Mart (NYSE:WMT), highlighting why the president favors the wholesale store. Costco pays an average of just under $21 an hour, offers health benefits to most employees, and some of its workforce is unionized. Wal-Mart, on the other hand, has long been criticized for its meager wages, paying its employees an average of under $13 a hour, offering sparse healthcare benefits, and denouncement of any kind of unionization. See the difference?
Costco is Obama’s go-to retailer to praise because its progressive style of management mimics what the president has been calling for all along — higher wages and benefits that help offset the growing gap in America between the rich and the poor. Costco executives also support an increase in the minimum wage, have vocalized their approval of Obamacare, and have contributed to both of Obama’s presidential campaigns. Sounds like a match made in heaven.