Tony Barzar, a 60-year-old Costco employee in Tucson, Arizona, has accumulated over $1 million in his retirement account, a financial milestone attributed to the retail giant's long-standing commitment to employee well-being and retention.
Barzar, who began his career at the company in 1986 when it was still Price Club, now earns the maximum hourly wage of $32.90 as a self-checkout monitor. His transition from a pension plan to a 401(k) following Costco's acquisition of Price Club in 1993 has been instrumental in the growth of his retirement fund. "I could retire, but what would I do? Costco has been good to me," Barzar told The Wall Street Journal. "I didn’t think me and my family would reach where we sit now."
The significant growth of his retirement savings has allowed Barzar to purchase a three-bedroom house with a pool and fund two trips to Europe in the past decade.
Costco's business model appears to prioritize long-term employee retention, recognizing that the cost of continuously training new hires can exceed the investment in experienced staff. This strategy is reflected in the company's remarkably low one-year turnover rate of approximately seven percent, a stark contrast to the retail industry's average of around 60 percent, according to the Bureau of Labor Statistics. "Thousands" of Costco employees currently have retirement plans exceeding $1 million, according to Chief Financial Officer Gary Millerchip.
Beyond competitive wages, Costco offers comprehensive benefits, including affordable healthcare. Barzar's wife, Jody, who also worked at Costco for 26 years in the bakery department, benefited from the company's insurance plans, which covered her three brain surgeries during cancer treatment. Barzar also utilized Costco's therapy benefits to cope with his wife's illness, highlighting the depth of support the company provides. He has since returned to work part-time at the same hourly rate.
Barzar, who received the Employee of the Year award in 2018, has opted to remain in his customer-facing role, declining opportunities for advancement. He stated, "I would say this is my calling, right where I’m at."
Another example of Costco's long-tenured employees is Lee Warders, who is in his 90s and retired from the Covington, Washington, store in April. Warders began working at Costco in 2011 and had developed a strong rapport with customers, some of whom created a Facebook page to share pictures with him. He contributed up to 50 percent of his income to his 401(k), leading to a substantial retirement fund.
Costco also employs "culture coaches," experienced staff members who mentor newer employees, contributing to a positive work environment. Barzar's journey exemplifies how the company's approach to compensation and benefits can foster loyalty and provide financial security for its long-serving employees.
