Sam’s Club increases starting pay for store workers, taking on Costco

Sam’s Club is hiking its pay for hourly retail workers, a move to attract employees and compete better against its rivals.

The club chain, owned by Walmart Inc., said store employees’ starting wages in the US will increase to $16 from $15. The company, which operates about 600 stores, also plans to give bigger raises to workers with longer tenures. The changes go into effect early November and will affect nearly 100,000 employees.

Initial pay at Sam’s Club remains below that of its main competitor, Costco Wholesale Corp. Costco, which operates more than 800 locations, in July raised its starting wage for US workers to $19.50.

Low pay, strenuous activities and unpredictable schedules have long made US retail work less appealing to job seekers. Turnover spiked during the pandemic, when employees faced unruly shoppers and hard-to-enforce mandates on face masks. US hourly wages jumped during the pandemic, but have generally climbed at a more modest pace since then.

Walmart, which employs about 1.6 million people in the US as the world’s largest retailer, started giving managers annual stock grants and raised their pay this year.