Walmart Affect The Economy
I do not believe that Walmart opening in this city will be helpful for our economy. There has been a lot of controversy surrounding Walmart, many people believe that Walmart helps the economy but many other believe it hinders it, in certain cases one is true, but in other cases the ladder is true. Walmart causes job loss in almost every city it enters into (Blasio, 2011), has a negative impact on “Mom and Pop” stores that are already existing within the community (Haltiwanger, Jarmin, & Krizan, 2009) and it decreases overall wages for the region (Mielach, 2012).
When Walmart opens in new cities it causes the loss of three already existing jobs when it only has two job openings. This causes a 2.7% reduction in retail employment (Blasio, 2011). …show more content…
Walmart is responsible for the closure of 40-50% of small discount stores between 1980 and 1990 (Kille & Ordway, 2015). One community in Chicago in 2008, experienced 82 of 306 established local business closed their doors because of the Walmart that opened in 2006 (Blasio, 2011). When people support small local businesses $68 out of every $100 stays within that community, where as with companies like Walmart only $43 of every $100 stays in the community, $25 out of every $100 not staying within the community does not sound like a large amount of money, but Walmart is a billion dollar industry, that means $250 000 000 every year that does not stay in small communities that could boost the economy of a city (Blasio, 2011). The closer a small business is to Walmart the more likely it is to close, if the store is within 1 km of the store it has between 35-60%, for every kilometre away the store is it decreases by 6% (Berg, 2012). The percentage could be varied by the type of store such as drugs stores have a 20% likelihood of closing, home furnishings is about 15%, hardware stores are about 18 and toy stores have a 35% chance (Berg, 2012). Walmart also decreases prices at other stores by roughly 7-13%, which can impact “Mom and Pop” store bottom line …show more content…
The difference between already established employees in existing stores salary and a Walmart is roughly $3 an hour (Mielach, 2012). Most of Walmart employees fall below the poverty line, which can increase the burden on the taxpayers because they could qualify for government assistance (Blasio, 2011). Walmart can also increase the rent smaller business must pay in shopping malls because owners of strip or shopping malls use these stores to draw in small retailers (Kille & Ordway, 2015). The total earnings of retail workers all over North America has decreased by $4.5 billion per year because of Walmart (Mitchell, 2007). If Walmart were to increase their minimum by $1.14 for every store and passed that increase on to consumer the price increase on product would only by 0.09% (Mitchell, 2007). Keeping Walmart’s wages low hinders the local communities because the less money that the employees have the less money they can spend in the local economy, which makes it hard for communities with Walmart’s to thrive (Quednau, 2015). Walmart offers yearly bonuses to their staff sometimes they are estimated at $2000 for each employee, but any theft that happens within the store comes out of those bonuses equally, it has been $11 instead of the promised $2000 in the past (Nolan,
When Walmart opens in new cities it causes the loss of three already existing jobs when it only has two job openings. This causes a 2.7% reduction in retail employment (Blasio, 2011). …show more content…
Walmart is responsible for the closure of 40-50% of small discount stores between 1980 and 1990 (Kille & Ordway, 2015). One community in Chicago in 2008, experienced 82 of 306 established local business closed their doors because of the Walmart that opened in 2006 (Blasio, 2011). When people support small local businesses $68 out of every $100 stays within that community, where as with companies like Walmart only $43 of every $100 stays in the community, $25 out of every $100 not staying within the community does not sound like a large amount of money, but Walmart is a billion dollar industry, that means $250 000 000 every year that does not stay in small communities that could boost the economy of a city (Blasio, 2011). The closer a small business is to Walmart the more likely it is to close, if the store is within 1 km of the store it has between 35-60%, for every kilometre away the store is it decreases by 6% (Berg, 2012). The percentage could be varied by the type of store such as drugs stores have a 20% likelihood of closing, home furnishings is about 15%, hardware stores are about 18 and toy stores have a 35% chance (Berg, 2012). Walmart also decreases prices at other stores by roughly 7-13%, which can impact “Mom and Pop” store bottom line …show more content…
The difference between already established employees in existing stores salary and a Walmart is roughly $3 an hour (Mielach, 2012). Most of Walmart employees fall below the poverty line, which can increase the burden on the taxpayers because they could qualify for government assistance (Blasio, 2011). Walmart can also increase the rent smaller business must pay in shopping malls because owners of strip or shopping malls use these stores to draw in small retailers (Kille & Ordway, 2015). The total earnings of retail workers all over North America has decreased by $4.5 billion per year because of Walmart (Mitchell, 2007). If Walmart were to increase their minimum by $1.14 for every store and passed that increase on to consumer the price increase on product would only by 0.09% (Mitchell, 2007). Keeping Walmart’s wages low hinders the local communities because the less money that the employees have the less money they can spend in the local economy, which makes it hard for communities with Walmart’s to thrive (Quednau, 2015). Walmart offers yearly bonuses to their staff sometimes they are estimated at $2000 for each employee, but any theft that happens within the store comes out of those bonuses equally, it has been $11 instead of the promised $2000 in the past (Nolan,