Tuesday, August 03, 2004

Taxpayers Paying for Wal-Mart's Low Wages

People who defend Wal-Mart's and other low-wage employers say that at least they're keeping down costs for consumers. Not if those consumers are taxpayers, they're not. A new study shows what some of us have been saying for a while: Wal-Mart employees are so poorly paid that they still need state aid to get by.

By Abigail Goldman, LA Times Staff Writer

Inadequate wages and benefits force workers at Wal-Mart stores in California to seek $86 million a year in state aid, according to a report released Monday by the UC Berkeley Labor Center.

Moreover, if other retailers cut their wages and benefits to the levels offered by Wal-Mart Stores Inc., the cost to California's public-assistance programs would rise by $410 million annually, the study said.

In their report, Berkeley researchers Arindrajit Dube and Ken Jacobs contend that more than other retail workers, Wal-Mart employees rely on a variety of public-aid programs, including food stamps, Medicare and subsidized housing.

"In effect, Wal-Mart is shifting part of its labor costs onto the public," the researchers wrote. "Wal-Mart's long-term impact on compensation in the retail industry has the potential to place a significant strain on the state's already heavily burdened social safety net."
The public debate about whether Wal-Mart benefits or hurts local communities has grown considerably louder over the last few years, particularly in California, where some communities have opposed the company's expansion plans.

The company's wage and benefit structure was also cited as a reason behind last year's strike and lockout of unionized grocery workers in Southern California; the largest supermarket chains said they needed to revamp costs to compete with the retail giant.

Dube and Jacobs' study took into account statewide data on wages paid by large retailers, the numbers of workers throughout the retail industry who use state assistance programs and information gleaned from lawsuits about Wal-Mart's pay and benefits.
The report found that Wal-Mart's wages on average were 31% below those of the broader group of large retailers — $9.70 an hour versus $14.01 an hour.

And with less earning power, Wal-Mart workers rely more heavily on state resources, Dube and Jacobs found, costing the state $32 million in health-related expenses and $54 million in other assistance.

The study contends that the average non-management Wal-Mart employee receives $1,952 in public assistance compared with $1,401 for workers at large retailers in general.

"The disproportionate use by Wal-Mart workers of the various healthcare and social safety net programs, and the cost that that brings to the state, is an important consideration for policymakers," Jacobs said in an interview.

Dube and Jacobs noted that other studies have reported similar findings.

In Georgia, a state survey of the state's children's health insurance program found that Wal-Mart employees' families disproportionately relied on the program, accounting for more than 10,000 of the 166,000 children enrolled.

In Congress, a report by Democratic staffers on the House Committee on Education and the Workforce looked at employee eligibility for assistance programs and found that a typical 200-employee Wal-Mart store could cost federal taxpayers $420,750 a year, or more than $2,000 per employee.

Wal-Mart has disputed those findings. (emphasis added by me)

I just bet they have. You know what it means that Wal-Mart's employees are even eligible for state aid? It means that Wal-Mart, one of the richest corporations in the country if not the world, is paying wages that are below the poverty line. And this is a corporation whose profits are so immense it could easily afford to double the salaries of every worker it's got and give them decent health care benefit packages and still retain an extremely healthy bottom line. Their excuse for not doing it is a lulu.

Bentonville, Ark.-based Wal-Mart, the world's largest retailer, maintains that it pays competitive wages and relieves public assistance burdens by giving jobs to many people who otherwise would not be employed.

So if we're even bothering to pay our workers at all, you should be grateful. It's a bonus. Really, we're doing you a favor. You should be happy we put these lazy, good-for-nothing welfare bums to work and got them off the dole--sort of, a little bit anyway. What, you want us to pay them a living wage, too? What are you, a Communist? You should be down on your knees thanking us, not hassling us because we demand they work one day a week for free or lock them in so they can't goof off or kite some of their measly pay or fire them when they complain about how little they're making, all that whiny shit about sick kids and they can't pay the rent, that's not our fault. We pay a competitive poverty wage, and if they can't get by on $200 a week take-home when the lowest rent in the area is $700 a month, that's their problem. This is a business, not a charity.

So listen up, all you pathetic taxpayers, you pay off because if you fuck with us, we'll scoot these people right back onto welfare and then you'll be paying all of it, not just 80%. So shut the fuck up. We're Corporate America and we make the rules. Ask Georgie, he'll tell you.