I love Nightly Business Report; this week. This week, financial commentator Hilary Kramer talked about Costco.
Kramer noted that Costco pays employees $17 an hour, which is $10 a more than Wal-Mart. She commented that Costco was reaping the benefits of this decision.
Costco also touts its employee benefits to market itself to prospective employees. (Wal-Mart nakedly notes that its health plan is designed to protect employees from catastrophic medical costs.)
Wal-Mart is assailed in the press for a litany of perceived wrongs, including moving towards offering employees high deductible health care plans, forced overtime, and having a disproportionate number of employees using medicaid and other state sponsored benefit plans.
Costco's stock price is up almost 12% in the last year; Wal-Mart is up 4.0% in the same period.
Now, I'm not sure that I'd call Wal-Mart and Costco strict comparables. Wal-Mart and Target are a bit closer. Target's stock price is up 15.2%.
My view is that the stock market is another collective consciousness...and one that literally values companies.
I can't tell you why the market likes Target and Costco more than it does Wal-Mart. But try Googling each company and see how many positive/negative websites come in the results. (And if you add "employee benefits" to your search, there is quite a marked difference.)
Benefits and insurance are tough in small businesses: Mom & Pop pay higher rates to provide employees with health insurance than Wal-Mart does. Many small businesses decide that they can't afford to provide this benefit.
I don't have any answers...but it is worth adding to the mix of things to consider as we decide what we want to create.
And to my recent points on conscious competition: you're "competing" for the best employees, too.