How do you feel about Wal-Mart?
Find a Conversation
| Wed, 11-26-2008 - 6:23pm |
I read this op/ed (it's tied in with the automotive industry issues) http://www.indystar.com/article/20081119/OPINION12/811190304/1301/ARCHIVE the other day and it got me thinking. I've always heard about the lousy way they treat their employees but...it's their prices that keep me going back. Since I've moved to the South it's been even worse. They have Super Wal-Marts here where there is a grocery store in the Wal-Mart.
Now, there was an article the other day in my local newspaper with the mayor asking people to do their Christmas shopping downtown and buy local to support our mom & pop stores. Now, I'd love to do that but I have three kids and you know where I'm going.
Part of me really doesn't like what Wal-Mart stands for but the other part of me feels like "why should I pay more when I know I can get it cheaper there?"
Any thoughts?

Pages
http://www.commissionersam.com/node/492
http://www.commissionersam.com/sam_adams/files/WALMART.pdf
New Study Identifies Effect of Wal-Mart on Local Economies
By Roland Chlapowski
There has been a lot of debate about the effect that Wal-Mart has on the communities it moves into - in particular, whether or not it affects the overall employment and wages of the localities that allow Wal-Mart into their borders.
A recent academic study from October, 2005 tries to cut through the controversy by identifying and eliminating biases that may have affected the usefulness of some earlier studies. The results do have caveats, such as mixed evidence on whether or not Wal-Marts raise or lower employment rates in the towns they reside in. But, rather unambiguously, this study finds evidence that Wal-Mart stores reduce overall earnings - regardless of their effect on the absolute number of jobs in the community. The abstract reads:
"There is strong evidence that total payrolls per person decline, by nearly five percent in the aggregate, implying that residents of local labor markets earn less following the opening of Wal-Mart stores. And in the South, where Wal-Mart stores are most prevalent and have been open the longest, the evidence indicates that Wal-Mart reduces retail employment, total employment, and total payrolls per person."
You can read the Wal-Mart Study here in adobe.pdf format, and learn about the methodology the researchers used to adjust for already existing trends in local earnings and labor outlooks. (In short, they take into account the existing economic conditions by factoring in the dates that Wal-Mart stores opened in new regions.)
Sam continues to oppose the proposed Sellwood Wal-Mart for many reasons, including the effect Wal-Marts have on small, locally-owned businesses, the consequences for wages and employment, the store's anti-union policies, and the documented increase in demand Wal-Mart creates for social services - and the burden that creates for taxpayers.
"In the retail sector, on average, Wal-Mart stores reduce employment by two to four percent. There is some evidence that payrolls per worker also decline, by about 3.5 percent, but this conclusion is less robust. Either way, though, retail earnings fall. Overall, there is some evidence that Wal-Mart stores increase total employment on the order of two percent, although not all of the evidence supports this conclusion. There is stronger evidence that total payrolls per person decline, by nearly five percent in the aggregate, implying that residents of local labor markets earn less following the opening of Wal-Mart stores. And in the South, where Wal-Mart stores are most prevalent and have been open the longest, the evidence indicates that Wal-Mart reduces retail employment, total employment, and total payrolls per person."
The simple presence of a Wal-Mart does not mean it is good for a community. I lament the Wal-mart-isation of this nation, it has cleansed away retail character and reformed it into some sanitised, cookie cutter endeavour. No thank you.
The simple fact that it is beholden to corporate interests well beyond the community means there is a net outflow of capital from the area as a result of their sales - as compared to local businesses where the owners spend and invest their money largely locally.
And that... is the revenue that flows out. How much of a store's gross sales do you believe stays in the area? Only the salaries, monies paid to local contractors for maintenance, etc, the taxes, and charitable contributions. The rest heads elsewhere.
I just saw a guesstimate that places the average Wal-Mart store gross sales at 100 million a year. Iwould guess the average property tax is 100 to 250 thousand annually.
Full length fiction: http://llhaesa.org/ (pronounced la.hay.ess.sa)
Full length fiction: worlds undone
"You have no power over my body..." ~ Anne Hutchinson
Wal-mart SHOULD be to blame! They are in control of how many people they allow into their store at once. it says something when this hasn't happened in over 20 years. I've been to Black Friday every year BUT this year. Wal-mart has a really poor policy on how their
Yes, I agree with you about suing Walmart.
Sopal
<?xml:namespace prefix = v ns = "urn:schemas-microsoft-com:vml" />
Wal-Mart prices
Wal-Mart provides consumers low prices. For example, studies show that Wal-Mart Supercenter’s food prices can be anywhere from 8 percent to 27 percent lower than large supermarket chains for an identical shopping cart of goods. One study estimates that the average savings on groceries alone from a Wal-Mart or other food retail supercenter is about 20 percent of the average household’s food budget - an average annual savings of $1,335 for a household of four.
Irwin said it’s important to remember that lower food prices are especially beneficial for low-income consumers, who spend a higher percentage of their income on necessities such as food. "When communities try to keep a Wal-Mart out, it hurts all consumers, but, in particular, lower income households," Irwin said.
Lower-price ripple effect
In addition, prices at neighboring stores - grocery stores, drug stores or variety stores - tend to decline when a Wal-Mart enters the local economy. "So, even if you never shop at Wal-Mart, your budget will likely benefit from having one nearby," Irwin said. One study examining store prices in 165 communities showed immediate price declines of 1.5 percent to 3 percent, and long-term reductions reaching up to 13 percent.
Another study showed food costs at traditional grocery stores drop an average of about 5 percent after a Wal-Mart opens nearby. Some economists theorize that Wal-Mart’s low prices have had a large enough effect on the American economy to deserve some credit for keeping inflation at bay in recent years, Irwin said.
Wal-Mart workers
Wal-Mart is often accused of paying workers low wages and not offering affordable health care plans. A paper presented at a social sciences conference earlier this year showed average retail wages per person decline by about 7.5 percent countywide after Wal-Mart arrives, with wages in the South suffering the most. "This was a very careful study and it showed a causal link," she said.
Another study showed Wal-Mart workers earn an average of 31 percent less than the industry average for large retail store jobs, and that 23 percent fewer Wal-Mart workers are covered by employer-sponsored health insurance. While these findings are sobering, Irwin said, a Wal-Mart job may be a blessing to previously unemployed workers. "The suggestion is that workers are worse off, but that depends on where, or if, they were employed before the Wal-Mart opened," she said.
Small retailers
"Here the research is crystal-clear," Irwin said. "Small retailers get driven out of business when Wal-Mart moves into town." One national study showed that five years after a Wal-Mart or Kmart opening, an average of four small retailers shut their doors. Another researcher estimates that Wal-Mart’s expansion in the late 1980s to late 1990s accounts for 50 percent to 70 percent of the decrease in number of small retailers across the United States.
Retail and wholesale employment
The research findings on the overall effect of a Wal-Mart on total retail jobs in a community are mixed, Irwin said. One study found a community loses between 180Ð270 retail jobs after Wal-Mart settles in; another showed an initial increase of 100 retail jobs. Five years later, however, the job gain dropped to 50.
Jobs in the wholesale sector tend to decline because Wal-Mart, in effect, acts as its own wholesaler. One study estimated counties could expect a decline of 20 wholesale jobs after Wal-Mart moves in. "It’s reasonable to look at this as a range of what a community might expect - possibly a significant loss of jobs, or possibly a very modest increase," Irwin said. Based on the research results, communities shouldn’t expect a large net increase in jobs because a Wal-Mart moves to town, she said.
Impact on manufacturing
"This is a revolutionary time," Irwin said. "In previous years, retail didn’t have any power. The retail sector simply paid manufacturers for their goods and then sold them to consumers." Global retailers, including Wal-Mart, have changed that, Irwin said.
In its early years, Wal-Mart made innovative uses of technology and transportation to lower its costs and pass low prices on to consumers. Consumers responded, which increased Wal-Mart’s market position. "At that point, they could take advantage of their size to reverse the direction, pushing back on suppliers, saying ‘We’re not going to pay more than X amount for your product.’ Now, instead a producer-driven supply chain, we have a retailer-driven supply chain," Irwin said.
"This trend is larger than Wal-Mart - every large retailer has that kind of bargaining position now - but Wal-Mart has been a leader in this area. And it has meant lower prices for consumers," as well as a loss of manufacturing jobs to overseas.
Impact on tax revenues
Many communities hope a new local Wal-Mart store will stimulate retail sales and add to the local government budget through higher sales tax revenues. By attracting consumers from across county lines, they hope for budget growth without relying solely on expenditures - or tax increases - from local residents. However, one study of Iowa communities showed such increases to be short-lived. Total sales in these towns increased by 6 percent two years after a Wal-Mart opening, and that figure held steady through year seven, Irwin said. By year eight, sales began to decline, and by year 10, sales were 4 percent below pre-Wal-Mart levels. The author of the study speculated that as more big-box retailers opened in nearby communities, the benefit of drawing out-of-town consumers diminished.
Impact on social program costs
Irwin said some studies establish a link between Wal-Mart stores in a community and increased poverty and reliance on public assistance programs. A California study estimated that Wal-Mart employees use an estimated 38 percent more in public assistance programs than the average large-store retail employee. Another study showed a correlation between higher poverty rates in a county in 1999 and the number of Wal-Mart stores in that county from 1987-1998. Irwin calls these studies suggestive, but not definitive: "While they imply that the presence of a Wal-Mart store in a community generates added social costs, these studies have not rigorously demonstrated such causal links."
Given all of this data, Irwin said communities face complex choices when a Wal-Mart or other big-box retailer sets its sights nearby.
"Should a community try to keep Wal-Mart out? Maybe that’s not a good idea," she said. "In the first place, you’re not likely to be successful in those efforts. And if you are, chances are Wal-Mart will go to a neighboring community and drain retail sales out of yours. And your local residents won’t get the benefit of lower prices without driving far away."
Possibly the best thing a community can do is to minimize effects on those likely to lose in the big-box battles, Irwin said. For example:
Plan for development
Communities can be proactive with zoning and development standards to address big box retail before it comes to town. Such standards should consider the optimal timing and placement of large retail development so that it utilizes existing infrastructure, is consistent with the community’s master plan and generates potential benefits to the community. This includes identifying locations and designing structures that are the most likely to attract people to other businesses and community assets.
Promote existing retailers
Communities can help smaller retailers promote what they offer consumers that the big-box store on the edge of town cannot: customer service, special ordering or distinct types of merchandise. In addition, road signs and promotional campaigns should be designed to attract out-of-town big-box shoppers to other retail centers in the community.
Educate consumers
Consumers vote with their dollars, but often the larger costs of low prices aren’t clear to them. Communities should consider public education campaigns to make them aware of the economic impact of their shopping decisions.
The report is online at www.aede.osu.edu/programs/ComRegEcon/walmart.htm.
http://www.naco.org/Template.cfm?Section=Community_and_Economic_Development&template=/ContentManagement/ContentDisplay.cfm&ContentID=19884
>>> The simple presence of a Wal-Mart does not mean it is good for a community.
Right...damn those jobs and low prices!
>>> I lament the Wal-mart-isation of this nation, it has cleansed away retail character and reformed it into some sanitised, cookie cutter endeavour. No thank you.
Then don't shop there. Millions of other, however, go there to get low priced goods for their family, not have an existential experience.
>>> The simple fact that it is beholden to corporate interests well beyond the community means there is a net outflow of capital from the area as a result of their sales - as compared to local businesses where the owners spend and invest their money largely locally.
You think that the employees of Wal-Mart drive to other towns or states to spend their money? You don't think that shoppers who drive to the Wal-Mart from other towns don't buy other goods from other businesses in the area? They don't eat at local restaurants? LOL!
>>> And that... is the revenue that flows out. How much of a store's gross sales do you believe stays in the area? Only the salaries, monies paid to local contractors for maintenance, etc, the taxes, and charitable contributions. The rest heads elsewhere.
What do you imagine happens with any other national or regional chainstore? Do you imagine that the local Macy's gets it's goods from a local cotton mill? Do you think the local Ford dealership builds it's cars "in the back" with local labor?
>>> I just saw a guesstimate that places the average Wal-Mart store gross sales at 100 million a year. Iwould guess the average property tax is 100 to 250 thousand annually.
Sounds like $100-250K more than the community would get if Wal-Mart weren't there. Thanks Wal-Mart.
Pages