Walmart Can Afford to Pay its Workers $12 Per Hour, Study Finds
Here's even better news: You can afford to pay these workers more. “Everyone knows” that when a retail employer pays higher compensation to “ground level” employees, the costs get passed on to the consumer. A recent study found that if Walmart employee wages were raised to $12 per hour, the cost passed on to the consumer would be $12.49 per year – just over a dollar a month.
The same study quoted earlier studies showing that Walmart's entry into a market is a decidedly mixed blessing for a community, coming with lower costs for the consumer at the cost of replacing existing jobs at retailers with lower paying jobs at Walmart, and increased cost at the state level to compensate for the number of Walmart employees who receive state and federal food and medical assistance as a result of their low wages.
This study has larger implications for the question of wages in general at the lowest tier of the economy. If the cost of labor can be passed on to the consumer at such a low rate, would it then follow that it benefits both the business and the society at large to demand higher wages – the business in order to be able to attract a higher caliber of worker, and the society in order to bolster the working and middle classes and increase income security.
Secondary effects from this on society would be substantial as well. If low paying retail and other businesses raised wages, this would have the effect of significantly raising the buying power of the section of society most likely to spend its entire income, which would in turn increase demand for products, which would then lead to higher levels of employment.
Henry Ford discovered this nearly a century ago, when he decided to pay the workers on the assembly line enough for them to purchase their own automobiles. Its a shame too many American businesses have forgotten this basic lesson.