How Rich Is The Costco CEO And What's The Average Pay Of Its Employees?

Jim Sinegal is the co-founder and now-retired CEO of American membership-based big-box retailer Costco. Despite building one of the largest retail chains in America, Sinegal consistently earned less than the average salary of CEOs and has called it "wrong" to have massive disparities between employee and executive pay, according to Business Insider. During his leadership tenure, Sinegal introduced many of Costco's strategies to keep overhead costs as low as possible, including its minimalistic retail spaces, limited inventory, and total lack of pricey advertising. To this day, this money allocation strategy has allowed for higher wages across the entire staff.

Born into a working-class family in Pittsburgh, Jim Sinegal worked his way through various grocery chains before founding one of the most profitable retailers in the nation. He co-founded Costco with Seattle-based attorney Jeff Brotman in 1983 (via Britannica). During his 35-year career at Costco HQ, the humble Sinegal was publicly praised for his generosity, frugality, and going out of his way to help his employees succeed and be happy. So, how much was he paid as CEO? Sinegal earned a $350,000 salary during his tenure at Costco – which was far less than the industry average of $1 million for Fortune 100 CEOs at the time.

When Sinegal went into retirement in 2018, he owned over $263 million in Costco stock (via The Seattle Times). Craig Jelinek is the current Costco CEO. He succeeded Sinegal, who stepped down in 2012. Jelinek had worked with Sinegal since his early days at FedMart.

So far in his time as chief executive officer, Jelinek has preserved Sinegal's generous leadership strategy by prioritizing its people. "We just stayed to our principles. It's what we do: take care of customers and employees and the people who are selling us merchandise," he said in a Seattle Times interview (via Business Insider). In 2018, he had a reported base pay of $800,000 a year plus a $97,000 bonus. He netted another $6.3 million in stock awards.

The current minimum pay of a Costco employee is $16 per hour (via USA Today). "Since Costco's inception, the company has been committed to paying the employees very competitive retail wages and providing them broad and affordable health care benefits," Jelinek said in February 2021. "Two years ago we moved our starting hourly wage to $15 everywhere in the U.S." More than 50 percent of U.S.-based Costco staffers earn more than $25 per hour, according to the CEO (via NBC News).

Costco even rewards hourly employees with regular bonuses and offers paid vacation time. "We try to take care of our employees because they play such a significant role in our success," Jelinek said (via Deli Market News).

"This is not altruistic; this is good business," Sinegal told The New York Times in 2005 regarding Costco's wages and benefits plans. So, there you have it. Modest, progressive leaders running a company that treats its employees well. What a concept!