The Real Facts About Wal-Mart: Walmart's Wages
Walmart’s entry into a market depressed wages and displaced better-paying retail jobs.
- A 2005 study found that Walmart’s entry into a metropolitan area eliminates similar jobs that pay about 18% more than Walmart. In those areas, the total average earnings of retail workers fell by 0.5 to 0.8%1.
Walmart’s average wage is below retail industry standards.
- Walmart’s national average wage of $11.75 an hour2 is 2.5% below the average wage of $12.04/hour for Retail Sales persons, the largest retail industry occupation, as reported by the Bureau of Labor Statistics (BLS)3.
Walmart’s average wage is below poverty level.
- Walmart’s average wage of $11.75/hour translates into annual pay of $20,7744. This is almost 6% below the Federal Poverty Level of $22,050 for a family of four.
Walmart’s average wage is distinctly lower than the average wage for unionized competitors in key markets.
- The average Walmart associate in California earns 26% less than the average wage of a UFCW worker at one of the three major supermarkets under the current master contract for Southern California5.
- In Massachusetts, a Walmart associate earns 19% less on average than a retail worker covered by a UFCW contract with a large employer6.
Walmart can afford to pay higher wages.
- According to a 2007 report, if Walmart started paying a $10/hour minimum wage, its workers could each earn $1,020 to $4,640 more per year, before taxes. If Walmart were to pass this cost directly to shoppers, the average consumer would need to pay only 36 cents more per shopping trip, or $9.70 per year7.
- In 2008, Walmart CEO Mike Duke received $12.2 million in total compensation8, or 587 times the annual income of the average full time Walmart Associate.
Walmart has a history of making taxpayers pay for the consequences of its low wages.
- According to a 2004 study9, public assistance used by Walmart associates costs California about $86 million a year. If Walmart associates in other states use public assistance at the same rate as those in California, the total taxpayer bill for Walmart public assistance could be up to $2 billion a year.
Walmart wages: not designed to support a family.
- Walmart spokesperson Mona Williams was quoted in 2004 for admitting that, "More than two thirds of our people... are not trying to support a family that’s who our jobs are designed for10."
Footnotes
1. Dube, Arindrajit and Steve Wertheim, October 2005. “Walmart and Job Quality—What Do We Know, and Should We Care?” http://laborcenter.berkeley.edu/retail/walmart_jobquality.pdf.
2. Nationwide average Walmart wages from “Corporate Facts: Walmart By the Numbers,” Walmart fact sheet dated February 2010. http://walmartstores.com/FactsNews/FactSheets/
3. Mean hourly wage rate for Retail Salespersons, obtained from Bureau of Labor Statistics, National Occupational Employment and Wage Estimates, May 2008, available at: http://www.bls.gov/oes/current/oes_nat.htm
4.The calculation assumes that a full-time Walmart worker works an average of 34 hours a week, 52 weeks a year. The average of 34 hours a week is obtained from an internal Walmart memo http://www.nytimes.com/packages/pdf/business/26walmart.pdf
5. UFCW analysis of store-level hours distributions and wage progressions from a 2009-2010 Southern California multi-employer master contract with seven UFCW locals.
6. From UFCW analysis of store-level hour distribution and wage progressions from a 2009-2010 UFCW master contract with a large New England supermarket and five UFCW locals.
7. Dube, Arindrajit, Dave Graham-Squire, Ken Jacobs, Stephanie Luce, December 2007. “Living Wage Policies and Wal-Mart: How a Higher Wage Standard Would Impact Wal-Mart Workers and Shoppers.” University of California, Berkeley Center for Labor Research and Education. Available online at http://laborcenter.berkeley.edu/retail/walmart_livingwage_policies07.pdf
8. Wal-Mart Stores Inc. Definitive Proxy Statement (Form DEF-14A) filed with the Securities and Exchange Commission on April 20, 2009, p. 36.
9. Dube, Arindrajit and Ken Jacobs, August 2004. “Hidden Cost of Walmart Jobs: Use of Safety Net Programs by Walmart Workers in California.” University of California, Berkeley Center for Labor Research and Education. http://laborcenter.berkeley.edu/retail/walmart.pdf
10. Transcript of PBS Newshour, 23 August 2004