Wal-Mart Makes Empty Claim of 22,000 Jobs
Don't pity the laid off United Auto Workers in Michigan. They're not facing a bleak economic future at all. They can always find a good job waiting for them at Wal-Mart.
The giant retailer put out a press release late last week that focused on job creation and Michigan. It's all part of Wal-Mart's expensive campaign to brand itself as the 'live better' company.
In fiscal year 2009, Wal-Mart spent $2.3 billion on advertising. That's about $6.3 million every day spent on image. One of the key myths that Wal-Mart creates is a form of mathematics not taught in any school in Michigan. It's called Wal-Math, and it works this way:
1 job created by Wal-Mart, minus 1 job killed at a smaller retailer = 1 job.
The most recent example of Wal-Math can be found in a Bentonville, Arkansas press release that the retailer issued to the media during its Annual Shareholder's Meeting in Arkansas late last week. The release was picked up and run by mainstream media across the nation, and each version contained the inaccurate depiction of Wal-Mart's impact on our economy.
The headline on the Wal-Mart press release read: "Wal-Mart U.S. To Create More Than 22,000 Jobs In 2009." "Wal-Mart U.S. announced today that it will create more than 22,000 jobs in 2009 to staff new or expanded stores in the United States," the company said. "'During this difficult economic time, we're proud to be able to create quality jobs for thousands of Americans this year," said Eduardo Castro-Wright, vice chairman of Wal-Mart Stores, Inc. "At Wal-Mart, we offer competitive pay and benefits and real opportunities for our associates to advance and build careers. Job creation is just one way in which we're working hard every day to help people across this country live better."
Last October, Wal-Mart told analysts it planned to open 142 to 157 new or expanded stores during the 2010 fiscal year in the United States -- a drop of almost 50% from its pre-2007 new store pace. Based on the Wal-Math formula, the retailer is going to "create" more than 1,000 jobs in states like Arizona, California, Florida, Michigan, New Jersey, Utah, Virginia and South Carolina. That gives you a sense of which states will see the most local site fights this coming year.
Given the bankruptcy of General Motors, it was more than coincidental that Wal-Mart chose to quote the CEO of the Michigan Chamber of Commerce in its national press release: "We are excited that during these economically challenging times Wal-Mart is investing in Michigan by creating good paying jobs and offering benefits to their employees. The positive impact that these jobs will have on the families of the new employees and their communities cannot be overstated." All those auto workers cast off by General Motors and Chrysler can drive across town and apply for work at Wal-Mart. They will notice a slight pay differential -- but other than that -- a job is a job.
Wal-Mart implies that the net impact of their new stores will be 22,000 jobs. But this is a gross figure, not net. The net change to employment in the United States due to Wal-Mart expansions in fiscal year 2010 will be negligible, because of the offset from jobs lost at smaller merchants. Most media outlets just ran with that headline of 22,000 jobs -- but one NBC affiliate didn't buy it.
The NBC station in tiny Carolina Forest, South Carolina, WMBF, saw through Wal-Mart's phony jobs rhetoric. A Wal-Mart superstore is coming to Carolina Forest. "Not everyone is excited about it," the station admitted this week. The TV station quoted Wal-Mart's Assistant Manager in Myrtle Beach, South Carolina as saying that Wal-Mart is hiring people in tough times. "A lot of people were laid off for different, various reasons, and we're able to hire them and give them a stable job," the Wal-Mart spokeswoman said.
But WMBF countered with an economist, Don Shunk, who explained how Wal-Mart really works. Shunk said that Wal-Mart jobs come at a price. "In reality, those jobs are in a large part coming at the expense of other retailers that are laying off people and are simply going out of business," he said. Shunk noted that the quality of jobs found at Wal-Mart are often not on par with the quality of jobs people are losing.
The Carolina Forest Wal-Mart is going to eventually have 350 employees, but many of their jobs will not be stable, their wages will barely keep them out of poverty, depending on their family size, and their health care coverage will either come from their employed spouse or from state and federal taxpayers. That's how 'live better' translates into everyday practice.
It would be more honest to tell people what the net impact of store expansions will be this year, instead of trying to present Wal-Mart as a job creator. Just as convincing a case can be made that Wal-Mart, in fact, is a job destroyer, and that store expansions this year will cost many people currently in the retail business to lose their employment in tough times. In reality, Wal-Mart helps create unemployment in this recession. Its gains are usually someone else's losses. As one of Wal-Mart executive told his employees: "At Wal-Mart we make dust, our competitors east dust."
Let the laid off workers at the UAW to apply for work at Wal-Mart, where they can be retrained to learn how to make dust.
Al Norman is the founder of Sprawl-Busters, and author of the book "The Case Against Wal-Mart." He has been helping communities fight big box sprawl for the past 16 years. His website is http://www.sprawl-busters.com