The
Wal-Mart Stores, Inc. (NYSE:
WMT) spin machine is in full force today. The first line from a recent press release from the company: "This month, Wal-Mart Stores, Inc.
will open 81 new stores and clubs across the country, providing jobs for 26,000 associates."
Economist Paul Krugman wrote about the company's questionable status as a job creation machine back in 2005:
... Adding 100,000 people to Wal-Mart's work force doesn't mean adding 100,000 jobs to the economy. On the contrary, there's every reason to believe that as Wal-Mart expands, it destroys at least as many jobs as it creates, and drives down workers' wages in the process ... The new store takes sales away from stores that are already in the area; these stores lay off workers or even go out of business. Because Wal-Mart's big-box stores employ fewer workers per dollar of sales than the smaller stores they replace, overall retail employment surely goes down, not up, when Wal-Mart comes to town.I don't have a strong position on whether Wal-Mart is good or evil. It's probably somewhere in the middle. But there's something disingenuous about trumpeting the creation of jobs using the gross number of hires with no mention of the fact that many jobs at other stores will be lost. I'm not saying Wal-Mart doesn't have a right to move in and put people out of business. That's capitalism. But bragging about job creation without taking that into account? That's some pretty serious spin.
Wal-Mart added that it's also building two new "High-Efficiency (HE.2) prototypes designed to significantly reduce greenhouse gas emissions and use 25 percent less energy than a standard Wal-Mart Supercenter."
Reader Comments (Page 1 of 1)
3-05-2008 @ 8:52PM
Bobby said...
Since mr Krugman is putting his elitist demonizing spin on walmart taking jobs away in the private sector he should also take into account although their "big box" stores have less employees to goods sold that also accounts for lower prices for an economy starving for fairness in that category. Other than forming a monopoly which eliminates competition & leaves us to the will of large entities to manipulate pricing this is never the case with walmart. Unfortunately they do hurt "smaller" business that can't compete mainly because of buying power & organization but there are enough massive chains (Costco, Target, etc.) to keep walmart honest. Anyone opposed to one of the best american success stories ever should take every dollar bill they have & effectively clip a third off of it symbolizing what the organized structure of a walmart saves the consumers.
3-05-2008 @ 8:52PM
Jeff said...
Citing Krugman as a source pretty well invalidates your entire position.
3-05-2008 @ 9:41PM
dave malden said...
Wal Mart sucks down competing stores within its zone of influence (about a 10 mile radius). It probably is still a new gain in jobs but a loss of spirit.
Look at the JOb-Jab bit on Wally's
3-05-2008 @ 9:43PM
sam Walman said...
Sorry its Jib-Jab
3-06-2008 @ 12:06AM
Jerry said...
Hey they left out all the jobs that they have overseas in China in the factores where they keep all those kids at saddly low wages to produce there made for walmart products and put in the walmart warehouses in china waitting to be shipped here just so they can make a killing off of the products because they made them so cheaply with the help kids yes in China Walmart employs children they have even documented it on TV one of My brothers in law was so discussed to here it he won't shop at walmart anymore because he seen that on TV
3-06-2008 @ 12:18AM
Brockage said...
Unfortunately critics like Mr Krugman don't give us facts, but instead rely on the handy "there's every reason to believe," but then if he had "facts," I suppose they'd be from a source hostile to Wal-Mart anyway, so it's six of one and half a dozen of the other. That's what we get when we mix where we buy our household items with where we stand politically. How weird that shopping one store rather than another is a political act. You're ok if you buy toilet tissue at Target, and if you buy it at Costco, you are among the elite in society - tres chic.
3-06-2008 @ 5:47AM
Michael Schneider said...
Innovative companies like Wal-Mart and Southwest Airlines have helped keep inflation low over the past twenty + years by providing efficiencies not only in those companies but efficiencies that diffused through their industries. If Wal-Mart cost some jobs in retail department stores and mom-and-pops, consumers have had more money in their pockets to spend elsewhere, creating jobs in other areas. Wal-Mart has had a lot of criticism just because they compete with more beloved department stores or with the mom and pops but Southwest has brought the same kinds of efficiencies to the airline industry and has earned nothing but adulation. I think part of the reason for this is that there aren't any mom and pop airlines and though people worry about big carriers ability to survive the savings on airline tickets is more visible than the smaller amounts saved much more frequently by shopping at Wal-Mart (It's interesting that some of the lower costs stem from the same processes-- like locating a bit out of the mainstream where costs are higher for real estate, taxes etc.). Big department stores and big airlines are seen by many as dinosaurs (see Richard Branson's recent comments in the Billionaire Watch section at http://www.Barrelomoney.com) but consumers seem to have more attachment to the department store dinosaur that the airline dinosaurs who are viewed as having brought problems on themselves. The other issue is of imports from China and other places which Wal-Mart uses. This doesn't affect Southwest. The US economy has gotten more tied to the global economy and the trade balance has suffered but Wal-Mart's crime here seems to be just doing a good job of doing what someone else would do or ultimately figure out how to do in a global economy.
3-06-2008 @ 11:56AM
Greg said...
What a crock!!
Wal-Mart expands because the population expands.
The "buying" or consumer base is growing in this country and every other country and the opening of a new Pizza Hut does not mean that Dominos is closing.
Why is Wal-Mart so vilified in this nation? Sam Walton was once revered and looked upon as a great entrepreneur and savy business man. Now if a Wal Mart opens up everyone condemns the move as imperialistic.
As well if you own a store and are not aware of the existance of Wal-Mart and do not take steps to compete BEFORE they move into your town or area you are foolish.
I live in Phoenix, AZ and a Wal Mart opened a store on a blighted property that had been vacant for years due to the failure of a "mall developement". Wal-Mart paid for all of the improvements to roads and infrastructure and provided over 800 jobs. There were over 9000 applicants for positions at the new wal-mart and I am not aware of one single store closure near the Wal Mart.
God Bless Wal Mart!!!
3-07-2008 @ 12:51AM
Jerry said...
Greg Hello Sam is DEAD you know like not in control of the company now and well if you haven't been able to see maybe because you a just blind walmart shopper just go in and think walmart is all great and don't see all the things have happend since he died but the company has went down hill so much all they care about now is money money money you could tell they didn't care about just money when Sam was alive they care about there workers they cared about what they sold they cared about having cheaper prices now now days though they only care about making money for them selfs and and the way it seems to me as far as they see who cares about anything else but how much money we bring in from our selfs because if you haven't heard all the things about how they treat there works and what they sell and how about how low this is they put children to make there products for them you know the ones that say made for walmart well walmart has control of making them and know who makes them and they just don't care about that children other then the fact that they can pay less and get away with it then oh well yea they do care about that ...lol
3-09-2008 @ 8:51PM
Bob said...
As a long time shopper at wal-mart and my wife an ex employee I think all the bad mouthing of wal mart is unfair some of it is true but most is wrong. But after years of shopping there I am no longer shopping at any wal mart stores I am sick and tired of going in there and buying crap made in China I would say 80% of the stuff in there is imported from China. When Mr. Walton was alive he bought a lot of stuff made in the good old U.S.A I know now it is hard to find a lot of items made here anymore because of the GREED of the ceo of different companies shipping out jobs overseas I now go to different stores and pay a little more to buy items made in the usa all I can say is if more people stop going to wal mart and finding stores that sells made in america products maybe all the greedy ceo will catch on and start providing more jobs to us americans.