The Real Reason Walmart U-Turned on Wages

[Panich52]

The Real Reason Walmart U-Turned on Wages

Why is the big box giant really raising wages for half a million of its associates?

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For more than half a century, Walmart has paid its 2 million-plus employees such depressed wages that many full-time workers cannot live on them. So many full-time employees are on state and federal welfare programs.

That’s how Walmart ended up becoming the single largest private-sector beneficiary of public assistance. U.S. taxpayers, according to Barry Ritzholtz of Rithholz Wealth Management, “have been subsidizing the wages of this publicly traded, private-sector company to the tune of $2.66 billion in government largesse a year.”

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Walmart has seen a 44% annual turnover rate among its hourly employees—a marked difference from the 6% turnover rate at rival Costco. ...

This practice may cost more than it saves. The Harvard Business Review estimates that for “skilled and semi-skilled jobs, the fully loaded cost of replacing a worker who leaves (excluding lost productivity) is typically 1.5 to 2.5 times the worker’s annual salary.”

Joel Naroff, chief economist at Naroff Economic Advisors, believes that “Wal-Mart’s move to raise their employee pay base is a sign that the labor market has already tightened.” Moreover, Walmart may just be trying to stop its workforce from leaving for better opportunitiesas the economy improves.

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Another explanation for the hikes is that Walmart’s wage raise may help stave off the union threat posed by insider protest groups such as the Organization United for Respect at Walmart (OUR Walmart).

People unionize when their needs are not being met. They think of unions when— for instance— wages are so low they need food stamps to buy from the place where they work, or when there is a food drive for them. If Walmart were to change this situation and provide them with what they need, what motivation would there be to unionize?

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Notably, Walmart’s promised salary increases aren’t even close to the minimum wage OUR Walmart wants. According to the retailer’s announced changes, over the next year, new associates will receive $9.00 an hour during training and at least $10.00 after.

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More
http://www.alternet.org/labor/real-reason-walmart-u-turned-wages?akid=12890.1924881._Cj8Ep&rd=1&src=newsletter1033204&t=20

[Thinkingabout]

1. This is a good move for any company. It is cheaper to keep good trained

Employees rather than hiring and training all the time. A good employee will go to work and do what they are supposed to and this makes the whole business work better.

[Sherman A1]

2. Like anything else

Wal Mart did this for their own motives and not for those of their workers. The stated objective was to improve customer relations as I recall, by having a happier and better grade of employee. There is also the reality of states and the federal minimum wage going up in the not too distant future. The reasons stated in the OP as well as giving their workers a bit more purchasing power to shop in their own stores.

Wal Mart can afford and should do much, much more. This is simply throwing the workers a few bones.

[anotojefiremnesuka]

3. If the workers do not unionize then they deserve to be treated like shit becasue that is what

telling the company to do to them.