How A $33-An-Hour Costco Worker Retired A Millionaire

Costco is once again making headlines for all the right reasons as one of its long-tenured, hourly wage employees is able to retire a millionaire.

The Wall Street Journal just ran a piece on Tony Barzar, a 60-year-old worker assigned to the self-checkout area who has worked for Costco since 1986. The outlet noted that Barzar earns $32.90 an hour and that holdings in his 401(k) have boosted his retirement savings to over $1 million. It’s all indicative of how Costco focuses on retaining high-quality employees and paying them well, which in turn leads to better experiences for both customers and workers.

This is not the standard in the retail industry, which is notoriously high turnover and usually offers relatively low wages. But Costco wants employees to stay longer rather than pay to train new ones all the time.

One 2023 study from the consulting firm McKinsey looked at online reviews of over 100 retailers by both customers and employees. The study found that the top 25% highest employee-satisfaction scores were more than twice as likely to fall in the top 25% of customer-satisfaction scores.

“The happiest workers can engender similar emotions in their customers, but they are also better at their jobs,” the report said.

Barzar is not the only employee enjoying these benefits. According to the retailer’s Chief Financial Officer Gary Millerchip, “many thousands” of Costco’s U.S. hourly workers have over $1 million in their 401(k) accounts. The company investing in employees in this way encourages them to stay, and because of their reputation there is “a pipeline of employees coming behind that group that also are building that level of experience.” Millerchip added that it was cheaper to retain good employees in the long run rather than constantly train new ones.

The numbers bear this theory out as Costco continues to perform well year over year. Per WSJ, Costco stock has increased over 2,000% over the past 20 years, trading as low as $40 per share following the 2008 recession to around $953 this week.

Costco is known for caring about customer perception, which is obvious based on its famous loss leader $1.50 hot dog and soda combination that hasn’t changed even as prices escalate.