LISSA’S: Wal-Mart’s Wages Increase in China, Rollback in US

Wal-Mart is raising wages for its employees -- in China, that is. Yes, the labor union representing Wal-Mart's Chinese workforce won yet another fight against Wal-Mart, successfully negotiating for an 8 percent raise for 2008 and 2009 as well as setting terms for paid vacation, social security, and overtime. This comes at a time when China's economy is booming, and demands for higher wages and better benefits are being pushed by none other than the Chinese government. Meanwhile, as the U.S. economy falters and Wal-Mart benefits, Wal-Mart's U.S. hourly workers are experiencing nothing short of a wage "rollback."

Sadly, wages for the average hourly U.S. Wal-Mart employee have actually fallen when adjusted for inflation. In 2004, Wal-Mart reported an average (Wal-Mart refuses to disclose a median wage which would provide a more accurate picture of wages at the company) hourly wage of $9.68. In 2008, the reported wage is $10.86. But in 2004 dollars, the average hourly wage is $9.55, which means workers are worse off today than they were four years ago. So, while the price of gas, food and health care are rising, Wal-Mart employees' wages are falling.

Even when not accounting for inflation, Wal-Mart's "average" disclosed hourly wage puts a family of four below the federal poverty line. In light of the fact that "full-time" work for Wal-Mart employees is often 34 hours a week, this means the "average" hourly worker earns only about $19,200 annually. Plus, starting wages at the company's stores are often much lower than the "average hourly wage."

So, it is no wonder that Wal-Mart employees top the public assistance rolls for Medicaid, SCHIP and other programs. But instead of actually raising wages to help employees lift themselves out of poverty, Wal-Mart chooses to get credit for telling them about how to get more government assistance. Case in point, just a few weeks ago, Wal-Mart came out in support of legislation that would require large employers to notify their employees about the availability of the Earned Income Tax Credit. Wal-Mart would never disclose how many of its employees likely qualify for this poverty-alleviating tax option, but given Wal-Mart's low wages, it is likely to be a sizeable number.

This is all happening in the context of an American economy that continues to decline while Wal-Mart's revenue continues to rise higher than ever. The company was again crowned the largest company in the world by Forbes, and has continued to outperform its retail competitors as shoppers trade down. The Walton family -- who control 43% of Wal-Mart stock through the Helen Walton Family Group -- earned close to $29 billion just on the increase in Wal-Mart stock prices during the previous seven months (November 2007 to June 2008) alone. The relationship between the Walton family and Wal-Mart workers is a stark example of the old adage that while the rich get richer, the poor get poorer.

We don't begrudge Wal-Mart raising wages at its stores in China (the employees there certainly need it) and it's also appropriate for the company to inform its employees about issues such as the Earned Income Tax Credit. But the company's U.S. employees need higher wages now more than ever.

Instead of perpetuating a cycle of poverty among its workers with a low wage, poor benefit business model, it is time Wal-Mart consider a meaningful wage increase for its hourly U.S. employees who are struggling just to make ends meet for their families. Wal-Mart can and should do better for its 1.4 million U.S. workers.

source: The Huffington Post

LISSA’S: Discounted Employees

Discounted employees

Wal-Mart's appalling labour practices mean it's getting rich at the expense of workers and their families

Wal-Mart, the world's largest private employer, now employs over 1.3 million Americans. Globally, more than two million people are now Wal-Martees, and several million more are dependent on these employees. Millions also make their livelihoods by selling their products, albeit at rock-bottom prices, to Wal-Mart. In America the only employer with more clout than this overgrown supermarket chain is the federal government. The company has annual revenues three times larger than California's state budget, profits bigger than the GDP of many small developing nations and the clout to set its own purchasing prices and drive competitors out of business by undercutting them with consumers.

This is all bad - very bad. I'm not going to try to make the argument that all big corporations are, by definition, problematic. For better or worse, we live in a corporate world. Unless we want to dedicate our lives to living some back-to-land dream, for the foreseeable future most of us are going to spend a significant portions of our incomes shopping at one megastore or another.

No, the reason it's bad that Wal-Mart is so extraordinarily dominant (and, arguably, the reason why Wal-Mart is so dominant in the first place) is that the company has appalling labour practices.

The monitoring group Wal-Mart Watch has reported stories of employees refused bathroom breaks, forced to work off-the-clock overtime and punished for attempting to unionise their fellow employees.

In recent weeks, I've spoken with employees who have been with the company nearly a decade and still make only about $10 per hour. Huge numbers of Wal-Mart workers earn far less, scraping by on as little as $7 an hour.

Many are technically part-time, because if they're listed as not working a full 40-hour work week they don't qualify for health insurance for the first year of employment. Afterwards, when the benefits kick in, Wal-Mart removes a startlingly high percentage of the already-low wages to help cover the costs of the insurance. In other words, while Wal-Mart claims to provide most of its employees with health insurance, in reality the employees themselves are paying much of the bill.

One 58-year-old woman I spoke with brings home, in a good month, just over $1,100 after taxes. Out of this, over $100 is removed for health insurance. If the insurance she got for this was comprehensive, that wouldn't be so bad. But it's not. She has to pay the first $1,000 of her medical bills each year before her insurance kicks in, and after that she still has to pay $20 for every doctor's visit and $20 for most prescriptions. So, she has health insurance, but she can only really afford to use it for emergencies. Other employees pay less that her per month in premiums, but their deductibles are even higher - having to pay upwards of $2,500 before the insurance kicks in.

How far does a $1,000 take-home paycheque go today? Well, figure that even in a depressed rural community, $350 is about as low as you can go for rent or a mortgage, or even for paying to use a trailer lot space. Heating is going to run you about $100 a month. Utilities, including phone charges, another $100. Since a car is pretty much a necessity in most of the small towns and outer-burbs where Wal-Mart sets up shop, add in $100 a month for basic car insurance. If you're paying off the car, your payments will be at least $100 a month. Then there's gas. At current prices, even someone not driving more than a few miles a day to and from work is likely spending close to $100 a month on gas.

That leaves about $150 for food, basic household items like toilet paper, dish soap and shampoo, clothing, medical bills, the paying off of credit card debt and entertainment.

What gives? Well, first off goes entertainment. If you're working a low-wage job in America today, even going to the movies is increasingly an impossibility.

Then you go without new clothes. Then medicines. Sure, you might need your blood pressure pills or you'll likely have a heart attack or stroke down the road, but who can plan that far ahead when you have to make a few dollars and change last the month. Many end up giving up their insurance altogether, banking on the fact that they are paid so little they can qualify for state Medicaid coverage or hoping, against hope, that they don't get sick.

Finally, you start skipping meals. Recently, I've interviewed Wal-Mart employees who never eat breakfast, who take low-grade sandwiches to work for lunch and crack open a discount can of soup for dinner. They buy fruit if it's on sale at one or another discount market. Occasionally they treat themselves to low-grade meat for dinner.

Wal-Mart has annual revenues of over $351bn, and last year made over $11bn in profit. On the assumption an average employee works close to 40 hours a week, it could pay every one of its two million employees an extra two dollars an hour (translating to roughly $4,000 more per year, per employee) and still end up with nearly $4bn in profit each year. That's close to $1.5bn more than the 2007 profit level of Target, its closest rival in the all-in-one department store business and a company known for paying its workers more than Wal-Mart does.

The extra money would raise hundreds of thousands of workers out of lives of poverty, would allow them to afford healthcare and to buy enough food to feed themselves and their families.

Don't hold your breath on this happening anytime soon. But, next time you shop at Wal-Mart, remember that many of those who serve you probably don't make enough money to properly feed and clothe their families.

source: guardian unlimited

LISSA’S: A $10 Minimum Wage At Wal-Mart? Better Wish For Two Front Teeth..

By: Al Norman

The UC Berkeley Labor Center has been producing research since 1964, but this week the research team released not one---but two---studies, neither of which you will find under Wal-Mart's Christmas Tree.

According to the first report, "A Downward Push: The Impact of Wal-Mart Stores on Retail Wage and Benefits," researchers found that employees at Wal-Mart earn lower average wages and receive less generous benefits than workers employed by many other large retailers. "Our research finds that Wal-Mart store openings lead to the replacement of better paying jobs with jobs that pay less," the Labor Center reports. "Wal-Mart's entry also drives wages down for workers in competing industry segments such as grocery stores."

The study examined Wal-Mart store openings for the 8 year period 1992 to 2000, and found that the opening of a single Wal-Mart store in a county lowered average retail wages in that county by between 0.5 and 0.9 percent. "In the general merchandise sector, wages fell by 1% for each new Wal-Mart. And for grocery store employees, the effect of a single new Wal-Mart was a 1.5% reduction in earnings," the study concludes. With an average of 50 Wal-Mart stores per state, the average wages for retail workers were 10% lower, and their job-based health coverage rate was 5 percentage points less than they would have been without Wal-Mart's presence. "Nationally, the retail wage bill in 2000 was estimated to be $4.5 billion less in nominal terms due to Wal-Mart's presence." This suggests that workers in 2000 would have taken home $4.5 billion more in their total paycheck if Wal-Mart had not been around.

"Overall," the researchers say, "the results strongly support the hypothesis that Wal-Mart entry lowers wages and benefits of retail workers." With more than 1.3 million American workers, Wal-Mart accounts for 55% of all general merchandise workers. In the area of large general merchandise companies with more than 1,000 employees, Wal-Mart workers earned 25% less than workers at competitor stores. Wal-Mart's impact on grocery store workers is especially dramatic. Wages of unionized supermarket workers are 27% higher than their non-union counterparts.

The UC study also found no evidence of job gains when a Wal-Mart opens. "Our study demonstrates that the opening of new Wal-Mart stores produces a decline not just in average wages," researchers explain, "but in the total wage bill of a county." As for health care benefits, the new study reports that 10 new Wal-Mart stores in a state caused a 1 percentage point drop in the proportion of retail workers getting health insurance from their workers.

The second study, "Living Wage Policies and Wal-Mart: How a Higher Wage Standard Would Impact Wal-Mart Workers and Shoppers," concludes that Wal-Mart could increase its minimum wage to $10 per hour and greatly boost the well-being of its low-income workers with little financial impact on most shoppers. Even if Wal-Mart passed on to consumers the entire cost of raising its wage floor to $10 per hour, the average impact on a Wal-Mart shopper would be higher product prices of less than 1% (0.9%). On the other hand, almost half (46.3%) of the wage income gain would go to workers living below 200% of the federal poverty level.

Less than 1 in 3 (29.3%) of shoppers with incomes below 200% of the poverty level would be impacted by the small price increase from raising wages. Giving Wal-Mart workers a more livable wage, it turns out, would literally be a 'small price to pay' for consumers. The study estimates that the average Wal-Mart shopper would have to pay an extra 36 cents per shopping trip, or less than $10 a year. Wal-Mart workers would gain $2.38 billion more in wages---a 9.3% increase in Wal-Mart's current payroll. For the lowest income Wal-Mart workers, a $10 minimum wage at Wal-Mart would translate into $1,020 to $4,640 more a year in pre-tax income. The Wal-Mart workers would notice the increase in their paycheck, but the average Wal-Mart shopper wouldn't even notice a change.

Wal-Mart claims that its average hourly wage is $10.11 an hour. But payroll data suggests that what workers get depends on their gender, race and job title. According to the wage study, 769,666 Wal-Mart workers are earning $9.02 or less per hour. There are 376,061 Wal-Mart full and part-time workers making less than $8 an hour. If all these workers were from the same city, they would equal the population of Minneapolis or Honolulu. If Wal-Mart raised the wages of its 238,872 full-time workers earning less than 8 an hour to $10, the average worker would take home an annual increase of $4,640. That's the definition of "live better" to the retailer's workforce.

According to the new wage report, as of January, 2007, Wal-Mart had sales exceeding $731 million every day, with around 18.1 million shoppers per day, and 127 million customers every week. The average shopper would pay $9.70 a year to give Wal-Mart workers a $6.52 million raise per day, or a total wage hike of $2.38 billion annually. This assumes that Wal-Mart absorbs none of this wage cost itself.

One of the best things Wal-Mart as a corporation could do to help low income families would be to provide its own "associates" with a decent wage hike. These two studies, seen in tandem, suggest that Wal-Mart currently is depressing wage rates in its industry, at a time when it could easily afford to give its workers a greater share of the pie. Wal-Mart could help hundreds of thousands of its own people to "live better," but instead has deliberately chosen to "save more" for the corporation---at the expense of the people who have helped the company make billions in profits.

What chance is there that Wal-Mart workers will find a $10 per hour minimum wage in their Xmas stocking? The "Associates" might as well be whistling through their two front teeth.
To view copies of the two reports released this week by the UC Labor Center, go to: http://laborcenter.berkeley.edu/

Al Norman is the founder of Sprawl-Busters.com, and author of the book Slam Dunking Wal-Mart: How You Can Stop Superstore Sprawl In Your Hometown