Josh Harkinson

Josh Harkinson

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Born in Texas and based in San Francisco, Josh covers tech, labor, drug policy, and the environment. PGP public key.

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Here's How Walmart Could Pay Workers a Decent Wage Without Raising Prices

| Wed Nov. 20, 2013 6:08 PM EST

Walmart has gotten a lot of bad press this week over news of an Ohio store holding a food drive for its own workers, who were unable to buy Thanksgiving groceries on the retail giant's paltry wages. The store managers deserve credit for their thoughtfulness, but wouldn't it be better if Walmart simply paid its workers enough to feed themselves? A new report from Demos, a liberal think tank, suggests that doing so wouldn't be as hard as you might think.

Walmart could continue spending $7.6 billion to buy back its own stock, or it could pay every worker $14.89 an hour.

According to the report, "A Higher Wage Is Possible," Walmart spends $7.6 billion a year buying back stock. Those purchases drive up the company's share price, further enriching the Walton family, which controls more than half of Walmart stock (and for that matter, more wealth than 42 percent of Americans combined.) If Walmart instead spent that money on wages, it could give each of its 1.3 million low-paid US employees a $5.83 per hour raise—enough to ensure that all of its 1.3 million workers are paid a wage equivalent to $25,000 a year for full-time work.

Walmart and its defenders like to argue that raising wages would require it to raise prices, which would in turn hurt its low-income shoppers. But Demos disagrees: "Curtailing share buybacks would not harm the company's retail competitiveness or raise prices for consumers," the report says. "In fact...higher pay could be expected to improve employee productivity and morale while reducing Walmart's expenses related to employee turnover."

A spokesperson for Walmart did not immediately respond to a request for comment.

 

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Walmart Ads Target "Low Income" Consumers With Junk Food

| Mon Nov. 18, 2013 7:00 AM EST

In 2011, Walmart pledged to offer healthier grocery options by reducing the sugar and sodium content of packaged foods, rolling out a "Great for You" food label, and making fresh fruits and vegetables more affordable. It has done that to an extent, but those are not typically the products that it markets to its "low income" shoppers.

A November 13 advertising circular specifically aimed at low-income customers included discount coupons for a two-liter bottle of Coca-Cola, a 10-pack of Kool-Aid Jammers drinks, and a 9.5-ounce bag of Cheetos. Only 3 of the 36 discounted items in the ad were labeled "Great for You," while 10 of them touted high-sugar, high-sodium, or high-fat junk foods. The ad did not include any coupons for fresh fruits or vegetables.

By contrast, coupons appearing at the same time in a separate, more broadly targeted "Grocery" advertising page included yellow onions, whole carrots, and Bartlett pears.

At some point after November 13, Walmart changed the name of its "Low Income" coupon page to "Stretch & Save." Walmart did not respond to questions about why it changed the name and why its Stretch & Save customers don't deserve healthier options.

Early this year, Michele Obama appeared at a Walmart store in Springfield, Missouri, to tout the retail giant's move toward healthier offerings. "For years, the conventional wisdom said that healthy products just didn't sell," she said from a podium set up in the produce section. "Thanks to Walmart and other companies, we are proving the conventional wisdom wrong."

But Walmart's advertising strategy seems to suggest that the retail giant still isn't willing to market fresh fruits and vegetables to the shopping demographic that most needs them. It's hard to say why. Maybe Walmart has figured out that ads for Bartlett pears won't get the poor through the doors. Or maybe its mediocre and low-margin produce just isn't profitable enough.

Either way, one would hope Walmart, as a corporate citizen, could see value in marketing healthy foods to low-income shoppers, given that those shoppers are also its workers. Then again, controlling its employees' health care costs typically hasn't been a big part of Walmart's business plan.

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