Wal-Mart Turns 50, But Not Everyone Celebrating
by July 2, 2012 10:14 pm 78 views
Kim Souza with our content partner, The City Wire, examines Bentonville-based Wal-Mart's supporters and detractors on the occasion of its 50th anniversary of doing business.
Sam Walton opened his first retail store in Rogers, Arkansas on July 2, 1962.
Writes Souza:
No one dreamed at the time the venture would eventually become the world’s largest retailer and employer with unprecedented profits for shareholders and values for consumers.
But economists continue to study and question the overall impact the Bentonville-based retail giant has had on the small business sector, its own suppliers, and the core army of “associates” that keep a legion of Walmart stores running around the clock.
Courtney Reagan, business analyst with CNBC, said Monday Wal-Mart’s 1.4 million U.S. employees account for 9.4% of the total retail trade workers in the nation.
According to the Bureau of Labor Statistics since 2005, Wal-Mart’s U.S. employee count is up 8%, but overall retail worker unemployment is up 8.7% in the same period. Unemployment in this sector rose from 6.8% in 2005.
Wal-Mart has had a profound impact on the retail sector overtime, despite the fact it was modeled after Gibson’s
Stores – a regional discounter that didn’t survive past the1990s.
“Walmart’s overall impact on the retail industry and beyond has changed the way business is conducted globally, and increased the consumer benefits – regardless of where they shop,” according to Walmartstores.com
That impact is both good and bad, depending on who you ask.
A 2004 study out of the University of Missouri, Sam Walton’s alma mater, found for every 100 jobs created by a new Walmart store, 50 retail and 30 wholesale jobs are lost over the next five years.
In 2007, another study by the University of California Berkley Labor Center revealed “When a state has 50 Walmart stores, the average wages for retail workers were 10% lower, and their job-based health coverage rate was 5% less than they would have been without Wal-Mart’s presence.”
The study concluded that nationally, the retail wage bill in 2000 was estimated to be $4.5 billion less in nominal terms due to Wal-Mart’s presence.
Read more on the subject from The City Wire at this link.