Costco slammed for wages and benefits

March 26, 2004 9:32 PM

Costco draws criticism from Wall Street for paying decent wages. One analyst complains that "Costco runs its business like it is a private company." The Teamsters think otherwise, claiming Costco is the only company Wal-Mart fears. [via Obscure Store]
posted by F Mackenzie (55 comments total)

I was going to let my Costco membership lapse but now I will renew. . .

Fuck the WSJ, fuck the investors-first mindset.

Good for Costco. I will try to divise a way to let them know.
posted by Danf at 9:48 PM on March 26, 2004

Interesting. I guess this is some of the bad side of taking capitalism to its limits. Since worker happiness can't really be quantified or tailored to the bottom line (aside from say, reducing new worker retraining costs if you don't have high turnover), it gets lost in the mix. It is in the best interests of a public company to pay its workers as little as possible, charge as much as possible for goods and turn in the highest possible profits.

Costco is doing right by their workers, I have several family members that are long-time employees, but I had no idea they paid so well and offered such good benefits. Frankly, I'm surprised and impressed. They're certainly a successful american company that customers like and I shop there every once in a while when I need a pallet of toilet paper.

It'll be interesting to see what Costco does about this. It would seem in the best long-term interests to continue to treat their employees right, but in the short-term, profits could rise if benefits were reduced.
posted by mathowie at 9:55 PM on March 26, 2004

I know several people who work at the Costco back home. It's a surprisingly demanding job. Costco expects every employee to be on the look-out for customer fraud, for example. The most amazing thing is, though, that they all are. Where we've all heard that Wal-Mart has to lock their stockers in to keep them from stealing the store blind, at Costco, employees are incredibly vigilent about anything that might cause a stock loss.

Treat your employees right, and they'll actually care about their jobs. A novel concept, I know, but one that seems to be working for Costco.
posted by jacquilynne at 10:00 PM on March 26, 2004

WSJ's opinions is about as close to central-planned socialism as one can get without going communist. The free market is supposed to be, you know free, free to try things differently, free to compete in different ways, etc. Investors are also free to put their money elsewhere too.

Costco appears to pay a penalty for its largesse to workers. The company's shares trade at about 20 times projected per-share earnings for 2004, compared with about 24 for Wal-Mart

The above makes no sense. Costco is a 'warehouse club' not a retail store. Comparing it to Sam's Club would be a better comparision. Not to mention I wouldnt walk into a Walmart if you paid me, its filthier than KMart and the prices aren't that hot. Low cost leaders have their place but so does everyone else.

Ann does mention Sam's club here:

Sam's Club has a "cost advantage" over Costco, she adds, because it can "leverage efficiencies" from Wal-Mart in areas such as merchandise sourcing and logistics, keeping basic membership fees a third cheaper than Costco's.

Wait, Sam's can lean on Walmart when it needs to yet Costco doesnt have a big daddy to help it. Hmm, that kinda helps explain things.

Ann Zimmerman , but the Ayn Rand books down for a second. Walmart's recent expansion has a lot more to do with KMarts recent implosion.

Write to Ann Zimmerman here!
posted by skallas at 10:11 PM on March 26, 2004

How is it that a shareholder in the share market gets any more kind of say in how the company is run than a punter at the horse race gets in how the horse is fed?

I'm all for full disclosure, more than the WSJ is. As in, I'm in favor of serious fines and jail time for 'creative accounting' of any kind. Of course you have the right as a shareholder to know where your money is going. But the right to have any kind of say in that, beyond taking your money out, let alone getting legal redress if your stock falls, flaws the system.

As for encouraging Joe Sixpack to throw money into the stock market for CEOs to vacuum up, that's just stupid, and legislating to insulate him from suffering the losses that will inevitably come his way is just wrong. It smacks of childish "no-losers"-ism, greatly discourages companies to honestly admit losses, and hence leads to the scam factory we currently have.
posted by aeschenkarnos at 10:41 PM on March 26, 2004

Danf: Fuck the WSJ

skallas: WSJ's opinions is about as close to central-planned socialism as one can get without going communist.

It wasn't an opinion piece. It was a news piece, and a well-written one, at that. Do you sincerely see some sort of bias in the article?

The above makes no sense. Costco is a 'warehouse club' not a retail store. Comparing it to Sam's Club would be a better comparision.

Aww, ferchrissakes. If Sam's Club was traded independently of Wal-mart, you'd be absolutely right, but it's not. The writer drew up a quick and dirty valuation comparison to add a little depth to her story.

What do you expect Ann Zimmerman to do with your emails, anyway?
posted by trharlan at 10:54 PM on March 26, 2004

>It wasn't an opinion piece.

The WSJ has a pretty damn strong bias on its own, if you haven't noticed.

trharlan: The writer drew up a quick and dirty....

and wrong analogy. They are two very different industries. I can buy 12oz of Ketchup at Walmart, but at Sam's Club/Costco I have to buy the friggin gallon. False analogy and all that, chap.

>What do you expect Ann Zimmerman to do with your emails, anyway?

Read them and try not to think of bad and erroneous examples that support the anti-labor opinions expressed in in the article.
posted by skallas at 11:14 PM on March 26, 2004

"Costco continues to be a company that is better at serving the club member and employee than the shareholder."

And this is an INSULT??


...costco figured out that treating their employees well attracts better employees and keeps the ones they have happier and more productive. Good for them.

If all businesses would catch this same clue, capitalism would work a lot better.

Don't go handing costco humanitarian awards either - you can bet their policies are ALL about the bottom line. Better employees = more money. this is the 'rational self-interest' rand was talking about.
posted by Tryptophan-5ht at 11:37 PM on March 26, 2004

The interesting part for me was the employee turnover figure - Costco has a figure of 24% pa, compared to Walmart's 50%. Hiring costs a lot of money. Between 10 and 25% of annual salary, depending on the industry. I would imagine that alone could justify Costco's hiring practises.

aeschenkarnos I must respectfully disagree with.

If I own a share in a company, I am a part owner. I can vote for board members. I do indeed have a say beyond the ability to buy or sell. And of course, larger shareholders have a larger say. The system depends on us doing so, in fact, and one cause of the US markets' problems is that institutional investers have been very slack in exercising their rights as owners.

The analogy with horseracing is a false one. I do not bet on shares, and neither do most investors who make money over the long term. I own a chunk of the company, and I'm very interested indeed in how my company is run.

I think encouraging people to invest in shares is foolish if they aren't simultaneously educated in finance. And your market is still largely overvalued, so your average investor's not going to find any bargains. I'm not sure what the connection with that comment and the story is though.
posted by i_am_joe's_spleen at 12:26 AM on March 27, 2004

I think the biggest flaw in the 'rational self-interest' theory is that people - very much including business executives - are generally very dumb by nature. Thus, rational self-interest leads to idiotic policies that hurt everyone.
posted by kaibutsu at 1:37 AM on March 27, 2004

skallas: ...and wrong analogy. They are two very different industries. I can buy 12oz of Ketchup at Walmart, but at Sam's Club/Costco I have to buy the friggin gallon. False analogy and all that, chap.

I believe the comparison is valid. Investors looking to put their money into a warehouse chain stock will see Sam's Club and Costco at the top of the list. They're the market leaders. Since they can't buy Sam's Club stock, they will consider buying Wal-Mart stock. Therefore Wal-Mart and Costco stock compete for investor demand. Increased investor demand drives up stock prices. Higher stock prices are an asset for any company.

That having been said, I personally hate this general investor short-sightedness and the stockholder-is-king mentality that's so standard that it's explicity taught in business school.
posted by halonine at 1:41 AM on March 27, 2004

"I think the biggest flaw in the 'rational self-interest' theory is that people - very much including business executives - are generally very dumb by nature."

isn't that the same flaw in democracy and VCR clocks?
posted by Tryptophan-5ht at 2:55 AM on March 27, 2004

IANAEA (economic analyst)... but.. seems to me, the people driving a company should be those with a developed sense of where the company should go and what it should be... not any old ass hole with a dollar who wants two (an investor)

I realize that by owning a "chunk" of the company investors are entitled to your say... but are they really in a position to dictate its policies? Why aren't there 30 steering wheels on public buses?
posted by Tryptophan-5ht at 3:03 AM on March 27, 2004

isn't that the same flaw in democracy and VCR clocks?

Damn straight.

Bring on the age of the Philosopher King!

New version includes trained monkeys to press the record button on your VCR! Never miss a Murphy Brown rerun due to personal incompetence again!
posted by kaibutsu at 4:32 AM on March 27, 2004

from the WSJ story:

Public companies need to care for shareholders first.

as the recent Enron, Parmalat, etc cases prove.


Costco's kind-hearted philosophy
...
Costco appears to pay a penalty for its largesse to workers

how dare they give a decent salary to the workers.
too bad you can't export cashier and janitor jobs to the Third World, then you'd really be able to exploit them.

nice to see the WSJ has gotten back to 18th century Economics.

I think ms Zimmerman has forgotten an important aspect: how terrible for the shareholders that slavery is illegal in the US -- imagine the happiness of shareholders if you could really cut costs.

the WSJ used to limit the "cheerleaders for plutocracy" thing to its sweatshop-loving, Clinton-is-Satan, Dean-is-Osama, kill-all-Muslims, foam-at-the-mouth editorial page. nice to see that attitude seep into the actual "reporting" sections of Dow Jones' paper.
posted by matteo at 5:00 AM on March 27, 2004

I'm with trharlan. I thought this was a well written piece and fail to see where you guys are picking up all the bias.
The editorial page of that paper reeks. The news pages are usually terrific and fairly even handed.
posted by CunningLinguist at 5:12 AM on March 27, 2004

I remember not too long ago there was a blue page post on the rather draconian measures that Wallmart had to go through to prevent shrinkage. How do Costco's shrinkage rate compare to Wallmart's? Does the average Alex Keaton bother to take that into consideration (if there is a difference)?

This hits close to home in a roundabout way. I'm an electrical engineer and I work for a server/supercomputer company that's been spiraling into oblivion for the 7 or 8 years I've worked there. I've noticed since almost day one that most of the measures that have been taken as corrections really weren't designed to correct anything. They didn't make it better for the employees and they didn't really help balance the bottom line. They sure didn't improve the market problems that got us into our particular predicament.

Sometimes they got executives big bonuses and other times they were things that the street applauded. Rarely, other than by serendipity I would argue, did they actually improve the company.
posted by substrate at 5:36 AM on March 27, 2004

Cunninglinguist and trharlan, it doesn't matter what page of the paper an 'article' appears on. Every piece in a newspaper is an editorial. There is no such thing as objective journalism. Its just often harder to see the bias when it is embedded within a group of articles reflecting the same bias. To see the bias, you have to read other papers.

It is easy to present 'facts' as if that's all they are. Unfortunately, despite what we're taught in America, there is no such thing as a 'fact'.

Yes, you can give me the old '2+2=4, that's a fact' nonsense, but it is beside the point. When you're presenting any story to the public, the choice to even present that story is an editorial choice in and of itself.

For instance, some newspapers find it important to cover the 'facts' of corporate bottom lines and shareholder value while other newspapers find it important to cover the 'facts' of employee working standards.

Both of those can be 'facts', but which fact do you want to report on? Which 'fact' is more important to you, as a newspaper editor?
posted by PigAlien at 5:43 AM on March 27, 2004

FYI: If you bought a TV (or anything else, I think) from Costco 10 years ago and it suddenly stopped working - Costco will take it back no questions asked. Their return policy, thought perhaps not aggressively advertised, is extremely generous.
posted by Hankins at 5:54 AM on March 27, 2004

Unless the article shows an actual, rather than a fantasized, link between Costco's stock value and its employee treatment it is all just a breeze blowing between a pair of glutes.

As for bias - all of the anti labour opinions are from institutional analysts accredited with proper and impressive sounding job titles. The pro labour opinion is from an investment manager described as a "fan" implying an irrational devotion.
posted by srboisvert at 5:59 AM on March 27, 2004

I like this gem in the article

You have to take the shit with the sugar
posted by RubberHen at 6:27 AM on March 27, 2004

For all I know, I own stock in Costco through one of my mutual funds. . .I used to keep track of such things but it's too hard anymore.

Even if I owned stock directly, I would still support Costco. . .and it's funny that I have never stepped foot inside a Walmart of Sam's Club, would never even thing of doing so, but I do have a Costco Card.,

Another cool fact: Costco flew in the Jayhawks for their company picnic last summer, in the Seattle area. . .
posted by Danf at 7:22 AM on March 27, 2004

rubberhen: poor Mary Poppins

i_am_joe's_spleen: If I own a share in a company, I am a part owner. I can vote for board members

Indeed you can if you own a stock with voting rights. As far as I know there are stocks who are privileged when it comes to the distribution of profits (they take more then stock with vote) and privileged in the even of bankrupcy, BUT they don't have any vote or limitation of voting rights.

Basically they're similar, but not equal to obligations emitted by the company. Not equal because obligations come first and stocks after in the event of bankrupcy.

But back to the point I wanted to make: ok , stocks are good idea to distribute risks and cost (for the shake of simplicity I'm not discussing stock fraud and fraud from company to stockholder now) but...

...when was the notion that stockholder are to be satisfied at the expense of the company survivability formed ?

In other words: why in the hell should company make stockholder gain some bucks ? Stockholder that are into a company for short to medium term return want that buck, but who's going to pay that buck ?
posted by elpapacito at 7:23 AM on March 27, 2004

I think the focus of the article on wages and benefits was too narrow, for several reasons.

First of all, an axiom of American business is that there is a major regional difference in wages and prices. But with the exception of the largest of the big cities, is this still true? Can you live on $14K in the panhandle of Florida as well as a person in upstate New York can live with $95K?

Second, and some have already mentioned it, is "corporate culture". Is it a reflection of where a company is headquartered as much of anything else (Wal-Mart, AR; Costco, WA)? Or is it based on the stage in the life cycle of a corporation: start-up, growing, mature, old, or in decline?

You also see this in the overall "company attitude". For example, when was the last time you saw public protest against a new Costco being built?

There is a lot more going on here than just wages and benefits.
posted by kablam at 7:27 AM on March 27, 2004

kablam: possible, what do you think is behind the scenes ?
posted by elpapacito at 7:44 AM on March 27, 2004

i think they ought to drag that forbes guy through manhattan from the back of his harley and leave him tied to a hydrant in front of the WSJ to die.
posted by quonsar at 8:23 AM on March 27, 2004

skallas made a good point distinguishing Walmart from Cosco. Think he is correct looking at membership fees. The customers paid a fee letting them shop at Cosco which adds to more revenue being spread through the company.
posted by thomcatspike at 8:34 AM on March 27, 2004

There is a lot more going on here than just wages and benefits.

Maybe he's thinking about the Costco being built on the grassy knoll. :)

Folks, it ain't rocket science. Treat your employees right and treat your consumers right, and everyone's happy. I see Costco doing something close to what Eugene Ferkauf did with the Korvette's stores back in the 1950s. Ferkauf undercut his competition by buying in bulk and moving merchandise at discount rates -- an appealing idea for postwar consumers looking to save a few bucks. The difference here is that Ferkauf was ruthless about how he treated his employees, and that Costco, while demanding, figured that offering reasonable wages and benefits was the way to keep employees happy.

Interestingly enough, it was expansion and mismanagement that did Korvette's in. I suspect Wal-Mart will fall eventually for the same reasons.
posted by ed at 8:42 AM on March 27, 2004

I suspect Wal-Mart will fall eventually for the same reasons.
Not sure if they will fall. Seems in the future they will be the "dolloar store" retail chains through out the US.
posted by thomcatspike at 8:51 AM on March 27, 2004

Good for Costco!

I had no idea that they paid so well. So they actually pay a living wage and have good benefits and Costco's the one that has screwed-up priorities? I don't think so...
posted by SisterHavana at 9:38 AM on March 27, 2004

Frankly, I'm surprised and impressed. They're certainly a successful american company that customers like and I shop there every once in a while when I need a pallet of toilet paper.

see, you hit right on the head. It is power if one needs to buy a pallet of toilet paper.
posted by clavdivs at 9:49 AM on March 27, 2004

I believe the comparison [between Wal-Mart and Costco] is valid. Investors looking to put their money into a warehouse chain stock will see Sam's Club and Costco at the top of the list.

The article does not point out that Sam's Club is losing to Costco in the warehouse club market-- to wit-- Sam's Club has 71% more U.S. stores than Costco (532 to 312), yet for the year ended Aug. 31, Costco had 5% more sales ($34.4 billion vs. an estimated $32.9 billion).

If you notice from the WSJ article, the only claim that Sam's Club is in any way superior to Costco comes from one of Wal-Mart's spokespeople.

Furthermore, Wal-Mart and Sam's Club, sharing the same brand, appeal to vastly different markets than Costco. Wal-Mart is good if you're looking for everyday products that can be bought very cheaply. Costco sells premium products at low prices. Sam's Club is having a lot of trouble breaking in to the "premium" market because they are dragged down by the Wal-Mart name and market space.

The WSJ article is an interesting one, but it is poorly sourced. I recommend that it be read side-by-side with the Fortune article.
posted by deanc at 9:50 AM on March 27, 2004

Go CostCo !! Go living wages !!

I went to their site, bought a membership and bought stock in their company thru their ShareBuilder link, and then sent them an e-mail telling them why. If you have the time (they could take some on-line shopping lessons from Amazon) and the dough, tell them in a way that will really have an impact.
posted by marsha56 at 9:52 AM on March 27, 2004

The difference in trading multiples mentioned in the article probably has more to do with public perception that Wal-Mart is one of the fastest growing retail chains around. There's strong brand recognition there and an expectation of future growth. I'm sure that impacts on stock demand hence a higher price.

Despite the fact that writer found a couple analysts who supported the hypothesis that the market thinks CostCo pays too well, I doubt that makes much of a difference with most buyers. Although the earnings expectations that had to be revised down a couple times last year probably didn't help their stock price any.
posted by willnot at 10:36 AM on March 27, 2004

Walmart, In the 90's didn't the first employees whom had stock do well financially? Having cash clerks & stockers retiring young.
posted by thomcatspike at 11:01 AM on March 27, 2004

The turnover rate at Costco was listed as 24% and 50% at Walmart. How much money is that extra 26%? Would that make up the difference in base pay and benefits?

Another interesting point that we are not seeing apples to apples, is that the employees who work part-time are listed as 43% for Costco and 30% for Walmart. That's not a fair comparison as Walmart considers a full-time employee (I don't know the exact number) something like 30 hours a week. Take that into account and the numbers are completely wacked.

This article was incredibly poorly sourced, the WSJ should seriously consider doing a follow up piece when they get all the number comparisons accurate.
posted by nakedelf at 11:30 AM on March 27, 2004

Everyone seems to think Wal-Mart is going to be the paradigm from here on out. While the chain may indeed keep on rolling for another decade or more, like everything else, the business model is eventually going to be eclipsed. We as a society - if not as individual investors - may well be better off it is eclipsed by a balanced model along the lines of a Costco, a model in which the needs of everyone involved - customers, employee as well as shareholders - are met; something where one need, such as that of the shareholders, is not held to trump the rest.
posted by kgasmart at 11:40 AM on March 27, 2004

Who would have thought that paying your workers more would make your workers care more about your company? If we start giving people another dollar and hour...... the terrorists have already won.
posted by Keyser Soze at 12:13 PM on March 27, 2004

You can be paid a lot and still hate who you work for.

One of the strongest factors working against unions are employers who treat their employees well. For the totally bizarre example of employee loyalty, Mars, the candy maker, is legendary.

Mars, still privately owned, have employees who care so much about their work that they are almost a little scary.
A cradle-to-grave employer, for years nobody would talk to an outsider about went on inside their production plants. How they inspire their workers is one of their great secrets, and other businesses would pay a fortune to find out how they do it.

Good pay is one thing, but when you work for Mars, you never leave. This speaks volumes.
posted by kablam at 3:34 PM on March 27, 2004

kablam--

Kind of funny that you link to an example of a Mars employee talking about what goes on inside their production plants...
posted by effugas at 3:41 PM on March 27, 2004

Honestly, though I personally prefer the policies of Costco over Walmart, some of our members, through their comments here, seem to need a basic lesson in modern investment and fund management. For all the rocket science and research the investment banks do, the fund managers and other institutional investors (the only people who count in determining stock prices) are as irrational and subject to fads and emotions as any MeFite.

So if one analyst, looking for a hook to differentiate his work and employer from the rest of the pack, says to herself "Hey, labor is a big part of their costs and WM is much more of a miser," that meme will get launched into the investing ether and everyone else will either jump on board, make snarky comments and ignore it, or come up with a competing analysis which shows how wrong Analyst A is. In any scenario, as long as the meme comes from a recognized analyst (who may or may not have ripped it off from some discussion board), everyone investing in that sector or type of stock will have to deal with it. This includes journos looking for today's lead.
posted by billsaysthis at 4:01 PM on March 27, 2004

effugas: as I said, "...for years...". As noted in that link, it was a complete surprise that the company agreed to answer any questions at all. But that heightened security is not uncommon in the candy industry, rife with industrial espionage.
What is uncommon is how loyal their employees are, and how the cultivate that loyalty. How many companies still have the cradle-to-grave philosophy that used to be the hallmark of a good company?

Wal-Mart continually fights to keep its employees from unionizing. But I have a feeling that sooner or later, they will, and Wal-Mart will have to have a major attitude adjustment, or slowly collapse.
posted by kablam at 6:21 PM on March 27, 2004

I like to think of this huge building backlash against Walmart and how it does business.

I liked CostCo before and like it more now. I've gone through three phone systems and paid for one.

I haven't set foot in WalMart for many, many months now and never plan to go near one again.
posted by fenriq at 8:41 PM on March 27, 2004

I'm selling my Wal-Mart stock and putting it all back into Costco.
posted by jasenlee at 9:53 PM on March 27, 2004

While Costco is better than Wal-Mart, they are not universally loved. They force employees to gather signatures of an initiative they are supporting and use eminent domain to take away land from a church in Cypress, CA.
posted by calwatch at 1:11 AM on March 28, 2004

"I think the biggest flaw in the 'rational self-interest' theory is that people - very much including business executives - are generally very dumb by nature."

isn't that the same flaw in democracy and VCR clocks?

It is the same flaw in democracy, which is why we don't have a straight democracy - we have a regulated democracy (a republic), with a constitution and multiple branches that check one another, to offset the impulses, fears, and irrational tendencies that we collectively fall prey to in the short term if we don't guide ourselves by creating long term rules.

I don't know what to tell you about VCR clocks, though.
posted by mdn at 7:39 AM on March 28, 2004

they weren't forcing employees - they were paying employees. forcing implies that they were made to do it without pay.

also, they did not try to take land away from a church. the city of cypress did that.
posted by centrs at 7:57 AM on March 28, 2004

Wow, calwatch, way to misrepresent your link. When I read your description, I expected to find a story of employees who said they disagreed with the initiative still being forced to collect the signatures. Or employees being asked to solicit signatures on their own time. Or something even remotely objectionable. But "Costco pays employees to look after Costco's interests" doesn't play nearly as well, does it?

The second link is also sketchy as hell. But at least there, an argument can be made that they could probably have put a stop to it by stepping away from the table. The council might have continued their scheme with another big box retailer, of course, but at least Costco would have tried.
posted by jacquilynne at 9:12 AM on March 28, 2004

How many times have you heard 'Stocks in [Corporation] rose sharply on news of a massive downsizing plan'? Lots?

If that doesn't feel right to you, then you have the freedom not to invest in those stocks. Yes, there's always the incentive to reduce inefficiency, but, frankly, the WSJ's perspective here isn't one of 'investment', but of short- and medium-term speculation.
posted by riviera at 9:15 AM on March 28, 2004

frankly, the WSJ's perspective here isn't one of 'investment', but of short- and medium-term speculation.

You appear to have given the nail massive cranial trauma, as they say. Seriously, I know you were just explaining a pretty basic, but that's a well-turned phrase. It kind of describes Wall Street in general since the 1980's.
posted by Ignatius J. Reilly at 11:59 AM on March 28, 2004

basic point
posted by Ignatius J. Reilly at 12:00 PM on March 28, 2004

I suppose Costco is telling people what to do on their time. If your employer told you to campaign for George W. Bush all day, instead of doing your normal job, would you do it?
posted by calwatch at 5:13 PM on March 28, 2004

Depends how much they paid me. The line between ethics and money is a bit blurry. But the fact is, unless you can present any evidence at all that there were employees who asked not to be tasked to supporting that initiative, and were then forced to, you're making tenuous connections where none exist.
posted by jacquilynne at 6:05 PM on March 28, 2004

"If your employer told you to campaign for George W. Bush all day, instead of doing your normal job, would you do it?"

Given that this is illegal in most if not all jurisdictions, and that I work in a federally regulated industry, um... no.

"Is it a reflection of where a company is headquartered as much [as] anything else...?"

Large national companies do very much reflect the culture of their HQ region. I submit the following as anecdotal evidence:

I liked the large (public, shareholder-driven, Buffet-property) company I work for -- headquartered locally -- until it was bought out by some outfit from a flyover state. After a couple of years the culture became one of looking really tremendously busy over actually getting things done. Judging from how my stock options are doing, the market rather preferred actual results to the ruse.

There's also a new corporate blindness to the fact that the cost of living here is much, much higher than out in flat, square corn and wheat country, and unfortunately that's reflected in the customary compensation packages.
posted by majick at 8:08 PM on March 28, 2004

It wasn't an opinion piece. It was a news piece, and a well-written one, at that. Do you sincerely see some sort of bias in the article?

There's a way to make an effort at appearing non-biased, and this article doesn't follow it. If the headline was "Analysts question Costco employee compensation," that would be true. However, no one at Costco made the statement "We have a dilemma."

In fact, the only direct quote from a Costco representative I could find in the article was a statement of corporate philosophy that could have been lifted from any press release. The only quote from an acknowledged shareholder is positive. All of the negative comments come from analysts.
posted by mikeh at 8:50 AM on March 29, 2004