Minimum wage and Costco
So I watched Morgan Spurlock's show 30 Days last night -- this episode was all about trying to live on minimum wage. Did you know that the minimum wage has not been raised by the government in over 8 years?
I don't know if you ever have, but I have been that poor. There was a time when I was in between high school and college. I knew lots of people who worked 2 and 3 jobs to support their kids. I had one job -- at a yogurt place. It paid like $4 something an hour. I had to share a place in the hood -- the crappiest hole I've ever lived in. Surrounded by Mexican families who lived 10 to an apartment, with babies all around who would cry all night.
I grew tired of the yogurt job very quickly, mainly because it just didn't pay enough. So I started working as a waitress and a maid. At least with tips, I could hope for more than an hourly wage of 4 something. And as a maid working for myself, if I worked fast, I could earn as much as $10 an hour. Six years later, when I had taken all the community college courses I could take and was ready to finish up at the university, I was making $10/hour as a receptionist. Same as what I made as a maid, only I didn't have to clean toilets.
Deciding to go back to college was one of the smartest things I ever did. Yeah, it was a risk, having to take out all those student loans. I still owe a buttload of money to Sallie Mae. But at least I'm not working as a receptionist anymore. One of the great things about this country (whoops I almost wrote company - ha - Freudian slip) is that we do have choices. You don't have to stay working in a minimum wage job. You can go to school and start a whole new career. I worked my way through school and upon graduation, I accepted a position paying $35/hour. Over 3 times what I was making before.
Clearly, the investment I made in myself was worth it. And not just because I earn more money. That is the least of it. I am grateful that I took the risk because I broadened myself as a person. I learned that I can accomplish what I set out to do. Which is probably what gave me the foundation of confidence that made me believe I could sell a cookbook. Which has led to me now believing that I can sell a novel.
The thing is, everything builds on everything else. One step leads to another, leads to another. People don't become rich or famous or brilliant overnight. They take one little step that seems like nothing at the time but it leads to another step and another and another. And you know what? I'm glad I went through all of that. I'm glad I was that poor and worked my way up. Because I really do appreciate things now.
But back to the subject of minimum wage. I was reading the NYT this morning and there is an interesting article about Costco. I never shop at Costco, even though there is one just down the street from my house. I guess I just didn't want to pay the $45 or whatever it is to join, and I figured I couldn't really use Costco because they make you buy too much stuff at one time. But now that I read this article, I am going to start shopping there. In fact, I might even buy some Costco stock.
Some exerpts:
Costco's average pay, for example, is $17 an hour, 42 percent higher than its fiercest rival, Sam's Club. And Costco's health plan makes those at many other retailers look Scroogish.
Good wages and benefits are why Costco has extremely low rates of turnover and theft by employees, he said. And Costco's customers, who are more affluent than other warehouse store shoppers, stay loyal because they like that low prices do not come at the workers' expense. "This is not altruistic," he said. "This is good business."
Despite Costco's impressive record, Mr. Sinegal's salary is just $350,000, although he also received a $200,000 bonus last year. That puts him at less than 10 percent of many other chief executives, though Costco ranks 29th in revenue among all American companies.
"I've been very well rewarded," said Mr. Sinegal, who is worth more than $150 million thanks to his Costco stock holdings. "I just think that if you're going to try to run an organization that's very cost-conscious, then you can't have those disparities. Having an individual who is making 100 or 200 or 300 times more than the average person working on the floor is wrong."
Workers seem enthusiastic. Beth Wagner, 36, used to manage a Rite Aid drugstore, where she made $24,000 a year and paid nearly $4,000 a year for health coverage. She quit five years ago to work at Costco, taking a cut in pay. She started at $10.50 an hour - $22,000 a year - but now makes $18 an hour as a receiving clerk. With annual bonuses, her income is about $40,000.
"I want to retire here," she said. "I love it here."
How Costco Became the Anti-Wal-Mart: http://www.nytimes.com/2005/07/17/business/yourmoney/17costco.html?incamp=article_popular
I don't know if you ever have, but I have been that poor. There was a time when I was in between high school and college. I knew lots of people who worked 2 and 3 jobs to support their kids. I had one job -- at a yogurt place. It paid like $4 something an hour. I had to share a place in the hood -- the crappiest hole I've ever lived in. Surrounded by Mexican families who lived 10 to an apartment, with babies all around who would cry all night.
I grew tired of the yogurt job very quickly, mainly because it just didn't pay enough. So I started working as a waitress and a maid. At least with tips, I could hope for more than an hourly wage of 4 something. And as a maid working for myself, if I worked fast, I could earn as much as $10 an hour. Six years later, when I had taken all the community college courses I could take and was ready to finish up at the university, I was making $10/hour as a receptionist. Same as what I made as a maid, only I didn't have to clean toilets.
Deciding to go back to college was one of the smartest things I ever did. Yeah, it was a risk, having to take out all those student loans. I still owe a buttload of money to Sallie Mae. But at least I'm not working as a receptionist anymore. One of the great things about this country (whoops I almost wrote company - ha - Freudian slip) is that we do have choices. You don't have to stay working in a minimum wage job. You can go to school and start a whole new career. I worked my way through school and upon graduation, I accepted a position paying $35/hour. Over 3 times what I was making before.
Clearly, the investment I made in myself was worth it. And not just because I earn more money. That is the least of it. I am grateful that I took the risk because I broadened myself as a person. I learned that I can accomplish what I set out to do. Which is probably what gave me the foundation of confidence that made me believe I could sell a cookbook. Which has led to me now believing that I can sell a novel.
The thing is, everything builds on everything else. One step leads to another, leads to another. People don't become rich or famous or brilliant overnight. They take one little step that seems like nothing at the time but it leads to another step and another and another. And you know what? I'm glad I went through all of that. I'm glad I was that poor and worked my way up. Because I really do appreciate things now.
But back to the subject of minimum wage. I was reading the NYT this morning and there is an interesting article about Costco. I never shop at Costco, even though there is one just down the street from my house. I guess I just didn't want to pay the $45 or whatever it is to join, and I figured I couldn't really use Costco because they make you buy too much stuff at one time. But now that I read this article, I am going to start shopping there. In fact, I might even buy some Costco stock.
Some exerpts:
Costco's average pay, for example, is $17 an hour, 42 percent higher than its fiercest rival, Sam's Club. And Costco's health plan makes those at many other retailers look Scroogish.
Good wages and benefits are why Costco has extremely low rates of turnover and theft by employees, he said. And Costco's customers, who are more affluent than other warehouse store shoppers, stay loyal because they like that low prices do not come at the workers' expense. "This is not altruistic," he said. "This is good business."
Despite Costco's impressive record, Mr. Sinegal's salary is just $350,000, although he also received a $200,000 bonus last year. That puts him at less than 10 percent of many other chief executives, though Costco ranks 29th in revenue among all American companies.
"I've been very well rewarded," said Mr. Sinegal, who is worth more than $150 million thanks to his Costco stock holdings. "I just think that if you're going to try to run an organization that's very cost-conscious, then you can't have those disparities. Having an individual who is making 100 or 200 or 300 times more than the average person working on the floor is wrong."
Workers seem enthusiastic. Beth Wagner, 36, used to manage a Rite Aid drugstore, where she made $24,000 a year and paid nearly $4,000 a year for health coverage. She quit five years ago to work at Costco, taking a cut in pay. She started at $10.50 an hour - $22,000 a year - but now makes $18 an hour as a receiving clerk. With annual bonuses, her income is about $40,000.
"I want to retire here," she said. "I love it here."
How Costco Became the Anti-Wal-Mart: http://www.nytimes.com/2005/07/17/business/yourmoney/17costco.html?incamp=article_popular