Wednesday, May 23, 2007

Study finds Wal-Mart contributes to poverty

The study, which sought to identify the independent effect of Wal-Mart stores on changes in U.S. family-poverty rates at the county level, found that one of the greatest effects of a Wal-Mart opening is the closing of mom-and-pop-type operations.

The authors state in the study that "by displacing the local class of entrepreneurs, the Wal-Mart chain also destroys local leadership capacity."

Poverty rates will rise if retail workers displaced from existing mom-and pop-type operations work for Wal-Mart at lower wages because they have no alternatives, all else equal, according to the study.

The demise of mom-and-pop stores leads to the closing of local businesses that supplied those stores, such as wholesalers, transporters, logistics providers, accountants, lawyers and others. Many of these are higher-paying jobs. The study concludes that it is likely that these more highly-educated individuals depart from the rural community in pursuit of better opportunities elsewhere, contributing to the rural-to-urban exodus over the last decade, leaving behind those with fewer opportunities and raising the poverty rate by reducing the number of nonpoor households in the denominator.

Wal-Mart is estimated to employ no more than 2 percent of the average county's work force. The share of Wal-Mart's employment in total county retail jobs is substantially greater than only 2 percent. In addition, the Wal-Mart jobs may be part time as opposed to full time, leading to lower family incomes, all else equal, the study said.

A spokesperson for Wal-Mart was unavailable to comment for this story.

Via-St. Louis Business Journal


I was camping near Farmington, MO this weekend and went into town for some forgotten gear/food. The downtown was dead (Saturday afternoon), with lots of places boarded up. Why? Lo & behold there was a new Super Center built at the intersection of 67 & 72, thereby killing any reason for someone to go anywhere else.
you should have taken some pictures.
Sorry, that was me
what was even funnier was when tracy and i were in the parking lot there was a young mother or big sister maybe 17) with scads of kids. she was wearing a summer dress, empire waist looking, floral. as we were bypassing woman's clothing there was a rack with those same dresses. we both did a double take and chuckled. considering that walmart has limited clothing options and the other stores are boarded up, it's conceiveable that everyone will be dressing identically pretty soon hehe.
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