Congressional Study: Walmart Costing Taxpayers because of its Low Wages!

Dear Commons Community,

Walmart wages are so low that many of its workers rely on food stamps and other government aid programs to fulfill their basic needs, a reality that could cost taxpayers as much as $900,000 at just one Walmart Supercenter in Wisconsin, according to a study released by Congressional Democrats on Thursday.  Though the study assumes that most workers who qualify for the public assistance programs do take advantage of them, it injects a potent data point into a national debate about the minimum wage at a time when many Walmart and fast food workers are mounting strikes in pursuit of higher wages.  The study uses Medicaid data released in Wisconsin to piece together the annual cost to taxpayers for providing a host of social safety net programs, including food stamps and publicly subsidized health care, to workers at one Supercenter in the state.

According to the report, Walmart had more workers enrolled in the state’s public health care program in the last quarter of last year than any other employer, with 3,216 people enrolled. When the dependents of those workers were factored in, the number of enrollees came to 9,207.

“When low wages leave Walmart workers unable to afford the necessities of life, taxpayers pick up the tab,” the report says.

The Huffington Post commented:

“The report, entitled “The Low-Wage Drag on Our Economy,” was produced by Democrats with the House Committee on Education and the Workforce, which is chaired by Rep. George Miller (D-Calif.). The committee says it chose Wisconsin because the state’s data “appears to be the most recent and comprehensive.” The paper is an updated version of an earlier report by the same committee in 2004, which at the time estimated that a 200-employee Walmart store could account for $400,000 in public assistance for workers.

“The labor policies of Walmart, and those of companies that emulate its low-road approach, end up leaving taxpayers holding the bag,” Miller said in a statement.

Critics have long denounced Walmart for paying such low wages that many workers are forced to take advantage of public-assistance programs like food stamps or Medicaid. (Notably, many Democrats who lament this scenario are strong backers of such programs.)

In fact, many workers throughout the retail industry take advantage of these programs, though a 2004 study of Walmart workers in California estimated the chain’s workers availed themselves of 38 percent more non-health, public-assistance money than workers at competing stores. (That report, by the University of California, Berkeley, had findings similar to the committee’s 2004 study.)

The Congressional report’s timing is no accident. Miller, along with Sen. Tom Harkin (D-Iowa), has sponsored legislation that would raise the federal minimum wage to $10.10, a boost that would presumably benefit many Walmart store employees. (The federal minimum wage, which prevails in the 31 states that do not mandate a higher one, is currently $7.25, where it’s been since 2009.) Democrats have argued that boosting the minimum wage would help pull some workers off of these programs.

Following sparse but high-profile walkouts by Walmart employees late last year, the union-backed worker group OUR Walmart announced “prolonged strikes” by employees this week. As of Thursday, organizers said 80 workers had joined the walkouts — a tiny fraction, for sure, of the estimated 1.4 million Walmart workers across the country, though labor activists are hopeful the strikes will inspire other workers.”


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