Walmart Could Give Big Raises Without Raising Prices, Demos Think Tank Says

November 20, 2013 | | Plain Dealer |

Walmart, enmeshed in a debate over low wages highlighted by a food drive for employees at a Canton store, can significantly raise the salaries of sales clerks and other workers without having to find additional money for the pay hikes, says a research brief by a think tank.

Instead of spending billons each year to buy back shares of its own stock in an effort to boost the price of shares, the company could redirect those funds to employee raises, said Amy Traub, a senior policy analyst with the self-described "progressive" Demos in New York City. She said based on the $7.6 billion Walmart spent buying back shares last year, the company could have given its low-wage employees raises of $5.83 an hour.

"A company must really invest in the fundamentals of its workforce and human capital rather than these Wall Street financial maneuvers that don't really improve the company, its performance or productivity at all," said Traub, who co-authored the brief with Catherine Ruetschlin, a Demos policy analyst

The brief clearly comes down on the side of workers, who have been battling with the world's largest retailer over wages. The Organization United for Respect at Walmart, or OUR Walmart, comprised of associates and supporters, is demanding that no full-time employee make less than $25,000 a year. Members of the group have gone out on strike against the retailer, including those who struck Monday in Dayton and Cincinnati, seeking higher wages. The authors specifically mention the struggle.

That debate came into sharp relief in Northeast Ohio earlier this week, after The Plain Dealer reported that bins had been set up in an employee-only area at a Canton store under signs reading "Please Donate Food Items Here, so Associates in Need Can Enjoy Thanksgiving Dinner."