How Does Wal-Mart Really Affect Your Community?

Last year I investigated the superstore Wal-Mart and its negative impact on communities through unethical business practices. By paying low wages and not offering health insurance, employees are often forced to rely on public support. This cost is then passed on to the taxpayer, according to a study by a University of California Berkeley. According to the schools Ken Jacobs "effectively, in California and the rest of the country, they are shifting their labor costs onto the public."1
However, according to Wal-Mart's Cynthia Lin, they pay far more in taxes than other stores and help the community by hiring out-of-the-mainstream workers. According to Whitaker that includes seniors, students, immigrants and part timers. "Wal-Mart actually reduces the taxpayer burden for public assistance, because they say without Wal-Mart, at least some workers would be on unemployment, while still others would be depending on pubic assistance for support" says Lin. But most progressive economists agree that low wage paying jobs are more harmful to the poor than no job at all. A more comprehensive measure of labor utilization is "underemployment" 2. The Bureau of Labor Statistics compared workers in this group to the unemployed, discouraged workers (people who looked for work at some point over the past year, but have given up due to lack of prospects), involuntary part-timers (part-time workers who would prefer full-time work), and a smaller group of people who want to work but face a barrier such as lack of transportation or child care. They found that underemployment was potentially more dangerous due to work related expenses.
This debate continues while the superstore has to answer to charges of gender discrimination and hiring illegal immigrants. They are also up against growing political resistance to their expansion. Community pressure has already blocked the construction of one store in Los Angeles, and the city council may require proof somehow that a new superstore will help and not hurt the community. People may save a little on their groceries, but they will see their taxes go up because of emergency room visits. Wal-Mart has a basic math business strategy; low prices and entry level jobs are a plus. That seems simple enough, until you factor the social cost involved.