LISSA’S: Workers and Communities Suffer When Wal-Mart Moves in

With annual sales of more than $288 billion, Wal-Mart netted $10.3 billion in 2004 profits, more than twice the profits of its leading retail competitors combined, according to the company's most recent annual reports. Wal-Mart CEO H. Lee Scott's salary and stock soared to $23 million in 2004. But many of his 1.3 million Wal-Mart employees are paid so poorly they can't even afford health insurance.

Wal-Mart's employees—more than 70 percent of them women—are paid an average $9.64 an hour if they are full-time employees, according to Business Week. Yet full-time workers, who comprise only about two-thirds of Wal-Mart's workforce, may be scheduled for as few as 34 hours weekly. Even at $9.64 hourly, working 34 hours a week, a Wal-Mart employee earns only $17,043 annually, well under the $18,850 federal poverty guideline for a family of four in 2004.
While 66 percent of workers at large U.S. firms get health coverage on the job, fewer than half of Wal-Mart workers do, an October 2003 AFL-CIO report finds.

Wal-Mart's virulent anti-union policies prevent workers from winning family-supportive wages and benefits. Unionized workers in the retail food industry make more than 30 percent more in hourly wages than their nonunion counterparts, according to a 2002 report by the Institute for Women's Policy Research. Yet when new employees start at Wal-Mart, they must first watch a video warning them against joining a union, according to author Barbara Ehrenreich, who chronicled her experience working at Wal-Mart in Nickel and Dimed: On (Not) Getting by in America.

By keeping its workers in poverty, Wal-Mart also impoverishes entire communities: When many residents have less to spend on goods and services, they can't support community merchants—and everyone's income and spending eventually drops.

Big-box retailers and supercenters such as Wal-Mart transform family-supporting, middle-class retail jobs into lower-paying jobs that often leave workers unable to pay bills.

With big-box retailers and supercenters tending to convert communities' union-scale retail jobs to fewer, lower-paying retail jobs, the difference in overall compensation, including wages and benefits, is "as much as $8 an hour," according to an October 2003 report prepared for the city of Los Angeles.

For every $1 wage cut, the local economy loses a total $2.08 as less money circulates through the local economy. If union grocery workers' wages were slashed to match the wages of Wal-Mart workers, their communities would lose between $1.6 billion and $3 billion annually.
If Wal-Mart paid each employee $1 an hour more, it could maintain its profitability level by increasing prices a mere half penny per dollar.

source aflcio.org