Costco's Profit Soars To $459 Million As Low-Wage Competitors Struggle

05/30/2013 09:56 am ET | Updated May 31, 2013
  • The Huffington Post

At a time when other retailers are struggling to get people into stores, Costco is enjoying a moment in the sun.

The big box giant's profit jumped 19 percent to $459 million last quarter, thanks in part to the company’s efforts to offer discounts to lure more members, according to Bloomberg. The company was able to offer those discounts and boost its profits while paying its workers a decent wage, a claim many of Costco’s competitors can’t make.

Nor can Costco's competitors claim growth quite like the wholesale retailer. Walmart’s sales suffered last quarter as shoppers struggled with a delay in their tax refund checks and a payroll tax hike. The company’s Sam’s Club unit, which is comparable to Costco, contended with similar obstacles in 2012.

Target, another Costco competitor, lowered its earnings forecast for the year, after customers cut back, pushing the retailer’s profits down 29 percent.

A typical Costco worker made $45,000 in 2011, according to Fortune. That’s compared to Sam’s Club workers’ average salary of $17,486 per year, according to salary information site Glassdoor.com. Walmart has also been the target of protests by some of its workers, who are protesting what they say are the company’s low wages.

For its part, Costco, or at least many of its officials, would like to see the company's practice of paying employees well put into law. The company’s CEO, Craig Jelinek, said earlier this year that he supports President Barack Obama’s proposal to raise the minimum wage, even arguing that lawmakers should boost it to $10 per hour.

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