President Obama pointed out that Costco’s decision to pay workers a reasonable wage leads to better-trained workers and lower turnover. In pointing out what Costco is doing right, the President was really saying what corporations like Walmart are doing wrong:
[box type=”shadow”]Profitable corporations like Costco see higher wages as a smart way to boost productivity and to reduce turnover. So entry-level employees here — stock associates, cashiers — start out at $11.50 an hour. Start at $11.50.
The average hourly wage is more than $20, not including overtime or benefits. And Costco’s commitment to fairness doesn’t stop at the checkout counter; it extends down the supply chain, including to many of the farm workers who grow the product — the produce that you sell.
Now, what this means is that Costco has some of the lowest employee turnover in your industry. So you’re not constantly retraining folks because they quit. You got people like Teresa who has been here 27 years — because it’s a company that’s looking out for workers.
And I got to tell you, when I walk around, just — I had a little tour of the produce section, the bakery — you could just tell people feel good about their job and they feel good about the company, and you have a good atmosphere, and the managers and people all take pride in what you do.
Now, folks who work at Costco understand that, but there are a lot of Americans who don’t work somewhere like Costco, and they’re working for wages that don’t go as far as they once did. Today, the minimum wage — the federal minimum wage doesn’t even go as far as it did back in the 1950s. And as the cost of living goes up, the value of the minimum wage goes down over time. Just last year alone, workers earning the minimum wage basically got the equivalent of a $200 pay cut because the minimum wage stayed the same but costs of everything else are going up.[/box]
The President’s decision to tackle income inequality head-on is enraging right wingers, but many feel it is refreshing to see him strongly redoubling his efforts on that front. He has announced that he will be issuing a dreaded socialist executive order requiring federal employees to be paid a minimum of $10.10 an hour, once again setting off accusations of imperial socialism from the right–but the more reasonable segment of society realizes that this is just a small step in that direction.
Watch the full speech below–and you will want to watch the full speech: