A new Demos study has revealed that the only thing stopping Walmart from paying their employees $25,000 a year without raising prices is their ridiculous level of greed.
According to Demos, here is how Walmart could afford to pay their workers $25,000 a year without raising prices,
Now as another holiday season approaches, this research brief considers one way Walmart could meet the wage target its employees are calling for— without raising prices. We find that if Walmart redirected the $7.6 billion it spends annually on repurchases of its own company stock, these funds could be used to give Walmart’s low-paid workers a raise of $5.83 an hour, more than enough to ensure that all Walmart workers are paid a wage equivalent to at least $25,000 a year for full-time work.
Curtailing share buybacks would not harm the company’s retail competitiveness or raise prices for consumers. In fact, some retail analysts have argued that by providing a substantial investment in the company’s front-line workforce, higher pay could be expected to improve employee productivity and morale while reducing Walmart’s expenses related to employee turnover.
With more money in their wallets, Walmart employees would likely spend a portion of the cash at Walmart itself, boosting the company’s sales. Sales might also increase as customers benefit from an improved shopping environment.
The other benefits of offering higher pay for Walmart would be attracting better candidates for positions, good publicity, and the potential for employees to view working at Walmart as a source of pride.
Walmart’s business model reflects the narrow minded economic views of the Republican Party. By choosing to only share profits at the top, Walmart is calling the stockholders makers and their employees takers.
The Republican idea that a business has to raise prices if wages are raised is false. Companies like Walmart can afford to raise wages without raising prices if they choose to do so. Costco has proven both Republicans and Walmart wrong by paying a living wage and watching their profits soar. Customers have abandoned Walmart for Costco in 2013, because unlike Walmart, Costco supports raising the minimum wage.
Costco goes beyond the Democratic proposal of increasing the minimum wage to $10.10 an hour. They already pay a $11.50 minimum wage, “At Costco, we know that paying employees good wages makes good sense for business,” said Craig Jelinek, Costco’s President and CEO. “We pay a starting hourly wage of $11.50 in all states where we do business, and we are still able to keep our overhead costs low. An important reason for the success of Costco’s business model is the attraction and retention of great employees. Instead of minimizing wages, we know it’s a lot more profitable in the long term to minimize employee turnover and maximize employee productivity, commitment and loyalty. We support efforts to increase the federal minimum wage.”
Walmart is being undone by their own business model, which mandates that employees are the bottom of the barrel, and labor costs must always be kept absurdly low. Walmart’s abuse and mistreatment of their employees goes beyond the poverty wages that they pay.
The greed of the Walton family is killing Walmart, and they are costing taxpayers billions of dollars each year. Customers will continue to flee as long as Walmart decides that it would rather be a modern American workhouse instead of a responsible employer.