Love Walmart or hate it. Shop there or boycott it. Those are your rights as an American consumer. But before you make a decision one way or another, please consider the overall picture, before reacting emotionally and viscerally to a store that provides jobs to 1% of the American people, while raising the standard of living for many of our poorer citizens. While doing some research because of an overwrought and rather histrionic conversation yesterday, I came up with an interesting fact (several really) which those that castigate stores such as Walmart for their profit making ability while excusing government of theirs will be sure to ignore: . For every $100 in sales, the average discount retailer like Walmart and Target earns $3.10 in profits, while the average take for the states with state and local sales taxes is more than twice that amount — almost $7, based on the 6.94% average sales tax rate for the 46 states that tax retail sales. Some high-tax states like Tennessee (9.45%), Arkansas (9.2%), Louisiana (8.9%) and Washington (8.9%), take in more than (or almost) $3 in state and local sales taxes for every $1 in retail profit. But look at who attracts the protests and boycotts…. Speaking of who boycotts Walmart.........which makes a modest 3.12% profit margin by helping to feed and clothe people who typically do not have a lot of spare money? Social-justice warriors who are too enlightened to let their poor neighbors pay lower prices, according to National Review’s Kevin Williamson. Meanwhile, contrary to widespread belief, big-box stores and chains like Walmart have increased wages in the retail sector as they have spread, according to a recent NBER paper Do Large Modern Retailers Pay Premium Wages? Here’s the paper’s conclusion: Over the last forty years, modern retail firms, those with the modern products and processes that support large chains, have become a large segment of the retail sector. Using worker-level data on wage rates, we show that the spread of these chains has been accompanied by higher wages. Large chains and large establishments pay considerably more than small mom-and-pop establishments. Moreover, large firms and large establishments give workers access to managerial ranks, and managers are a large fraction of the retail labor force, and earn about 20 percent more than other workers. A good part of these wage gains are returns to ability – large firms and large establishments hire and promote the more able. The retail sector pays considerably less than manufacturing, but as the manufacturing sector has declined over time, the growth of modern retail chains has increased retail wages and provided more promotion opportunities, particularly for the more able worker. And lastly, is there opportunity at Walmart for those that might otherwise not have a chance at upward mobility? I would answer in the affirmative, as about 75% of Walmart’s store managers began as hourly associates, and they now earn between $50,000 and $170,000 annually as managers. nationalreview/article/393648/who-boycotts-wal-mart-kevin-d-williamson/page/0/1 nber.org/papers/w20313 careers.walmart/about-us/working-at-walmart/
Posted on: Tue, 02 Dec 2014 10:46:38 +0000
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