Wal-Mart is a favorite of many consumers because of its low prices, but a new report claims those bargains have a dark side.
Because of the chain’s low wages, its workers are often pushed to accept public aid, including food stamps and subsidized housing, according to a report from congressional Democrats.
That means a single Wal-Mart Supercenter store in Wisconsin may require taxpayers to shell out as much as $1.7 million per year — or nearly $6,000 per employee — in aid, according to one estimate in the report. A second estimate pegged the cost to taxpayers at a lower $904,542 per Supercenter. The study examined Wal-Mart stores in Wisconsin because of the availability of Medicaid enrollment data for the fourth quarter of 2012.
“When low wages leave Wal-Mart workers unable to afford the necessities of life, taxpayers pick up the tab,” the report notes. “Taxpayer-funded public benefit programs make up the difference between Wal-Mart’s low wages and the costs of subsistence.”
Wal-Mart defended its record by noting the company offers opportunities to its workers, spokeswoman Brooke Buchanan told The Huffington Post. She said 75% of Wal-Mart managers started as hourly employees. The company provides “a chance to move up in the ranks,” she said.
It’s not as if Wal-Mart doesn’t have the resources to increase wages. The retailer, which employs about 1.4 million U.S. workers, earned $17 billion in profits last year. While the report notes it’s not clear how much Wal-Mart pays its hourly workers, one research company pegs the average at $8.81. (That’s above the federal minimum wage of $7.25 but below President Barack Obama’s call for a $9 baseline wage.)
At $8.81 per hour, the average Wal-Mart sales associate would gross about $18,300 per year, or well within the income range for a family of four to receive food stamps.
In Wisconsin, Wal-Mart was ranked as the employer with the most workers on the state’s Medicaid program, the report notes. Even though 3,216 employees qualify for Medicaid, Wal-Mart is responsible for 9,207 enrollees because of children and adult dependents of those workers.
Meanwhile, some Wal-Mart employees are participating in strikes around the country and leading a protest in caravans to the company’s annual shareholder meeting on Friday, the Nation notes.
Source: MSN MONEY