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Hey, Walmart, Want to Fix Those Sales Problems? Why Not Invest in Workers?

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Kenneth Quinnell
Kenneth Quinnell

An internal memo, recently leaked by a Walmart manager, urged store managers to improve lagging sales, primarily through addressing problems with understocked shelves and with keeping fresh meat, dairy and produce stocked and aging or expired items off the shelves. Such complaints are widespread at Walmart stores and are likely a significant factor in the company’s sales, which have lagged for 18 months. While the memo catalogs problems the company faces, it ignores the two most obvious solutions—giving workers adequate hours and paying those workers the $15 living wage they’ve been calling for.

Janet Sparks, a member of the OUR Walmart campaign seeking to improve wages and working conditions, said that substantial staffing cuts that began in 2010 are a big part of the problem: “Understaffing, from the sales floor to the front end, has greatly affected the store.”

Retail consultant Burt P. Flickinger III echoed Sparks’ comments:

“Labor hours have been cut so thin, that they don’t have the people to do many activities. The fact that they don’t do some of these things every day, every shift, shows what a complete breakdown Walmart has in staffing and training.”

This blog originally appeared in AFL-CIO.org on November 13, 2014. Reprinted with Permission. http://www.aflcio.org/Blog/Corporate-Greed/Hey-Walmart-Want-to-Fix-Those-Sales-Problems-Why-Not-Invest-in-Workers

Author’s name is Kenneth Quinnell.  He is a long-time blogger, campaign staffer and political activist.  Before joining the AFL-CIO in 2012, he worked as labor reporter for the blog Crooks and Liars.  Previous experience includes Communications Director for the Darcy Burner for Congress Campaign and New Media Director for the Kendrick Meek for Senate Campaign, founding and serving as the primary author for the influential state blog Florida Progressive Coalition and more than 10 years as a college instructor teaching political science and American History.  His writings have also appeared on Daily Kos, Alternet, the Guardian Online, Media Matters for America, Think Progress, Campaign for America’s Future and elsewhere.


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Fast food workers and SEIU President arrested outside McDonald’s HQ

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seiu-org-logoAdriana Alvarez has worked at McDonald’s for 4 years and makes just $8.75 an hour. She’s fighting for $15 an hour to win a better life for herself and her two year-old son Manny.

Just now, SEIU President Mary Kay Henry, Adriana and more than 120 fast food workers from across the country were arrested outside of McDonald’s corporate headquarters in Oak Brook, Illinois, where hundreds of workers are refusing to be silenced before their shareholder meeting.

These fast food workers need your help. Call McDonald’s and tell them you stand with Adriana and the other workers right now: 888-979-7395. Tell them that it’s time for $15 an hour and the right to form a union without intimidation.

Adriana and her fellow McDonald’s employees were arrested for their brave act of peaceful civil disobedience. Each of them was standing up for themselves, the families their wages support, and pretty much every fast food worker everywhere. Mary Kay Henry was arrested alongside them to send a clear message to fast food workers everywhere that the 2.1 million members of SEIU — home care workers, child care workers, adjunct professors, security officers, hospital workers and many others — proudly stand with them.

Please show your support now for these unbelievably courageous workers by calling McDonald’s this minute: 888-979-7395.

Tell McDonald’s that you support these workers. Tell them that it’s shameful that workers have to be arrested in order to be heard.

Just to be extra clear: Workers have already risked a lot by going on strike last Thursday in the biggest fast food action in world history. And it’s even scarier to go straight to the source and speak up for what they believe in. But Adrianna is doing it, and so are dozens of others. It’s pretty amazing.

Now it’s your turn to speak up for what’s right. Pick up the phone and call McDonald’s now: 888-979-7395.

The McDonald’s shareholder meeting starts in less than 24 hours and we have to make sure they hear us. No one who works for a living should be forced to live in poverty. No one who works for a corporation that makes more than $5 billion in profit should have hungry kids at home.

We’ve been live tweeting today’s action from Oak Brook at @SEIU, so check out our Twitter feed for of-the-moment updates. You can also visit FastFoodGlobal.org to stay updated as news breaks.

This article was originally printed on SEIU on May 21, 2014.  Reprinted with permission.

Author: Flora Johnson, Home Care Worker, SEIU Healthcare Illinois Indiana


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We Cannot Build a Strong, Equitable Economy on Low-Paying Jobs

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Mary Kay HenryWhat started out last fall as a one-day walkout at fast-food restaurants to protest poverty-level wages and stand up for basic human dignity has transformed into a movement that has captured the public interest.

I’ve been privileged, especially in recent weeks, to talk to institutional partners, policymakers and media about why low-wage workers across the country are risking their jobs and forgoing a much-needed day’s pay to work toward a better future for themselves and their families. We will be better off when hardworking people have enough money in their pockets to put back into their communities and generate more jobs, and SEIU members are proud to back these workers in their pursuit of economic justice and better lives for their families.

I traveled to New York City on Wednesday, to talk to Comedy Central host Stephen Colbert about the fast-food strikes. How in the world did this happen? I told Kendall Fells, an organizer from Fast Food Forward, it is because of the courage of the strikers, such as Shay Kerr and Shakira Campbell.

Shay has worked at McDonald’s in East Flatbush, N.Y., for six months. She earns minimum wage and, because sometimes her hours are cut for no reason, she can’t rely on a set pay every week. Since she cannot make ends meet on her wages, she has been bouncing around shelters. She’s fighting for a union so she can make a better life for herself and her 6-year-old son. Shakira is leading an action tomorrow at her store to be put back on the schedule. Their stories echo stories I’ve heard from workers all around the country.

Shakira, Shay, and many others who I have had the privilege of meeting in recent months are helping the public understand that, contrary to what some believe, these positions aren’t being filled by teenagers. Anyone who thinks they are is nostalgic for a time that no longer exists.

More than 4 million people work in the food service industry. Their average age is 28. Many of these workers have children and are trying to support a family. The median wage (including managerial staff) of $9.08 an hour still falls far below the federal poverty line for a worker lucky enough to get 40 hours a week and never have to take a sick day. According to the National Employment Law Project, low-wage jobs comprised 21 percent of recession losses, but 58 percent of recovery growth in the last few years.

This means middle-class jobs are disappearing while low-wage jobs are growing. If we simply accept this as fact, then the divide between the haves and the have-nots will only grow worse. And that is just wrong.

We cannot build a strong, equitable economy on low-paying jobs. Corporate profits are at an all-time high. McDonalds earned $5.5 billion just last year; other fast-food restaurants and retail chains are similarly profitable. They can afford to raise wages.

Americans have a long history of sticking together to fight for something better. SEIU can be proud of how we are fighting on so many fronts, from winning commonsense immigration reform, to delivering on the promise of the Affordable Care Act, to telling our elected officials to invest in vital public services, and to organizing in various sectors to make sure workers have a voice in the workplace. All of our members are involved in these campaigns to help workers strengthen and grow our union. As we do it, we know we have to reach out to the growing service sector of low-wage jobs in retail and fast food.

We are united to make a path to power for all workers; winning a just society; and leaving the world a better and more equal place for next generations to come.

This article originally appeared on SEIU blog on August 8, 2013.  Reprinted with permission.

About the Author: Mary Kay Henry is the International President of the Service Employees International Union (SEIU).


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Can McDonalds Make A Profit While Paying $15 An Hour?

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Bryce CovertWhile the average McDonalds employee in the United States makes just above the $7.25 minimum wage, that story is different in other countries. As Jordan Weissmann reports at The Atlantic, the minimum wage for full-time adult workers in Australia is $14.50 and McDonalds employees just negotiated a 15 percent raise by 2016. Yet the company has about 900 locations in the country.

Meanwhile, its profit margins at company-owned restaurants are higher in Europe than in the U.S. despite many countries there having a higher minimum wage. France’s minimum is about $12 an hour, and yet there are more than 1,200 locations there.

Residents of other countries pay more for their Big Macs, in part at least to make up for those extra costs, but the increase in prices is not drastic. Australians paid an average of $4.62 in U.S. dollars for a Big Mac in July and it cost $4.66 in the eurozone, while Americans paid $4.56. That’s a difference of about 6 to 10 extra cents, which would mean raising Big Mac prices a little over 2 percent in the U.S. to come equal with those in Europe.

Higher prices are related to the fact that the company does spend more on the cost of labor in other countries. In the U.S., it spends about 25 percent of its expenses on workers at the locations it owns, and franchises usually assume labor costs will take up about 30 to 35 percent. Worldwide, those costs have been found to come to closer to 45 percent of expenses. But the company reported nearly $5.5 billion in net income overall last year, up from about $2.4 billion in 2007, with more revenues coming from Europe than the U.S.

Australian locations have other ways to keep labor costs low, like exploiting a loophole that only requires an $8 wage for teenagers. Weissmann also reports that the company likely gives its higher paid European employees more responsibility and so ekes out more productivity from those workers. While productivity has risen in the U.S., wages haven’t.

But it’s clear, even to the company itself, that its American wages are not enough to get by on. It released a sample budget for employees that suggested paying nothing for heat, getting a second job, and spending just $20 a month on health care. While it claims to be an above minimum wage employer in the U.S., its average wages are mere cents more.

The inability to get by on its low wages has sparked pushback from workers across the country, with fast food workers striking in nine different cities. They are calling for a $15 minimum wage, the same as Australia’s, which is higher than President Obama’s $9 an hour proposal and Congressional Democrats’ of $10.10 an hour.

This article originally appeared on ThinkProgress on August 6, 2013.  Reprinted with permission. 

About the Author: Bryce Covert  is the Economic Policy Editor for ThinkProgress. She was previously editor of the Roosevelt Institute’s Next New Deal blog and a senior communications officer. She is also a contributor for The Nation and was previously a contributor for ForbesWoman.


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Walmart: Portrait of a Job Killer

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Image: Mike HallWhenever communities, lawmakers or activists question or criticize Walmart for the way it treats workers—the low-pay, the stores’ impact on the communities—the retail giant pulls out a well-worn script with a simple message, “Walmart creates jobs and if there’s one thing this economy needs, it’s more jobs.”

Setting aside the quality of the jobs for another day, is Walmart telling the truth? Sure doesn’t look like it, according to Salon’s Kathleen Geier, who matches Walmart’s claims against in-depth research from universities, economists, government studies and other sources. Here’s what she finds:

Contrary to Walmart’s self-glorifying mythology, the retailer is anything but a job creator—in fact, it is a huge job killer. Not only that, destroying jobs is an essential component of Walmart’s anti-worker business model.

She cites a study led by Economist David Neumark—who, by the way, has written against raising the minimum wage in a Wall Street Journal op-ed.

Using data from more than 3,000 counties, [the] results show that when a Walmart store opens, it kills an average 150 retail jobs at the county level, with each Walmart worker replacing about 1.4 retail workers. These results are robust under a variety of models and tests.

2009 study by Loyola University found that the opening of a Chicago Walmart store was “a wash,” destroying as many jobs as it created. According to the report, “There is no evidence that Wal-Mart sparked any significant net growth in economic activity or employment in the area.” Says Geier:

In short, when Walmart comes to town, it doesn’t “create” anything. All it does is put mom-and-pop stores out of business.

Walmart’s job-killing spree doesn’t stop at the city limits. The remains of once good jobs are scattered throughout Walmart’s entire supply chain. Its cut-throat drive for lower prices, writes Geier, squeezes suppliers to deliver goods at the lowest possible prices and that means cutting labor costs—aka jobs.

Read the full article.

Walmart’s using that specious jobs argument in its fight to block a living wage law in Washington,D.C. Find out more here.

Article originally appeared on AFL-CIO NOW  on August 6, 2013.  Reprinted with permission. 

About the Author:  Mike Hall is a former West Virginia newspaper reporter, staff writer for the United Mine Workers Journaland managing editor of the Seafarers Log.  He came to the AFL- CIO in 1989 and has written for several federation publications, focusing on legislation and politics, especially grassroots mobilization and workplace safety


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Living Wage Law Would Create Benefits for Business, City’s Economy

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John PetroIn response to the hottest legislative issue in City Hall right now, the Daily News ran two opinion pieces on a bill that would guarantee living wages to all workers at city-subsidized development projects. This would mean that if a developer receives city tax breaks or other assistance to build a mall, for example, the retail workers, janitors, parking attendants, and any other employee at that mall would be paid at least $10 an hour with health benefits, or $11.50 an hour without benefits.

The principle behind the bill is simple: the city should only use taxpayer dollars to create high-quality jobs. Subsidizing the creation of poverty-level jobs makes little economic or fiscal sense. After all, it already costs the state at least $5.2 billion to provide services and assistance to the working poor. Why should we use scarce tax dollars to subsidize development that will only add to these public costs?

In a piece filled with false assumptions and unsupported claims, Diana Furchtgott-Roth argues that guaranteeing the creation of good jobs will actually hurt the city’s economy and its taxpayers. Not only is the living wage in Furchtgott-Roth’s crosshairs, but also the prevailing wage and even the minimum wage. In other words, Furchtgott-Roth rejects the idea that government should regulate the labor market.

Clearly there are good reasons for government to do exactly that, not just in the name of altruism but for the sake of the taxpayer, the business climate, and the city’s overall economy. In 1960, speaking to members of Congress, President John F. Kennedy noted that, “The increases in purchasing power resulting from a higher minimum wage will help to restore consumer demand required to put our idle industrial capacity back to work.”

Even in China, which built its economy on low-cost labor, cities are passing new laws that boost worker wages in order to increase the purchasing power of Chinese households and to create domestic demand for Chinese goods and services.

But the discussion about wages and business in New York City has become so backward that the real and demonstrable benefits of boosting wages for the city’s economy has become lost in a sea of misinformation.

Take Furchtgott-Roth’s piece. The living wage bill will, according to the author: stall development, cause businesses to flee the city, waste taxpayer money, and increase unemployment. Notably absent was any evidence to support these claims.

In reality, living wage laws have not had any significant negative impact on businesses in the over 120 cities that have passed these laws. In Santa Fe, New Mexico every single worker within city borders is guaranteed by city law to be paid a living wage. This is, by far, a much more ambitious bill than what is currently under consideration in New York City, where only workers at subsidized buildings will be covered. And yet, a study by the University of New Mexico Bureau of Business and Economic Research has shown that since Santa Fe passed its living wage law there has been no demonstrable negative effects on employment or firm growth. Studies of other cities with living wage laws have demonstrated similar results.

Despite the evidence the living wage bill in New York City is strongly opposed by Mayor Bloomberg and real estate interests. This is because the bill challenges the current economic development status quo. Instead of promoting the types of projects that create the most wealth for a select group of developers, the bill would ensure that working New Yorkers benefit directly from the city’s economic development efforts

About The Author: John Petro is an urban policy analyst at the Drum Major Institute for Public Policy. He runs the Progressive Urban Model Policies (PUMP) Project, a first-of-its-kind initiative to organize and share best practices in policy design and implementation. His writing on urban issues has appeared in the San Francisco Chronicle and his recent research has been covered in Politico, The New York Times, Reuters, and other media outlets.


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Living wages Key To Poverty Eradication

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appleby_2005Advocates for the poor are pushing against the same obstacles that 18th century opponents of slavery confronted: acceptance of an evil because of its familiarity. It’s hard to be outraged by a condition that’s been around for millenniums. Even the Great Emancipator despaired of ending poverty.

Quoting Scripture, Abraham Lincoln said that the poor will always be with us. That attitude once applied to slavery. Then, with remarkable suddenness, the idea of abolition aroused a cadre of reformers who changed public perceptions in less than a century.

So do we really have to accept that poverty is too firmly entrenched to ever be dislodged?

A worldwide movement is gaining momentum to disrupt complacency about poverty, and one of its centers is right here in Los Angeles. For nearly two decades, a robust social movement has been devising creative solutions that meld progressive ideals with a pro-business approach to ensure that people with jobs can actually provide for their families.

Its first victory came when it guided through the L.A. City Council a living-wage ordinance in 1997. Today more than 100 municipalities from San Diego to New York have passed ordinances mandating living wages for city employees and those employed by companies doing business with the city. Wages vary depending on prevailing local rates and which benefits are included.

Like slavery, the issue the Los Angeles Alliance for a New Economy addresses is an old one. Two hundred years ago, the British radical William Cobbett denounced the cruelty of jobs that kept sober and industrious workers fully employed but did not pay them enough to feed their families.

Arguments against raising pay through legislation come up every time Congress tries to raise the minimum wage. At $7.25 today — even after the increase passed by Congress in 2007 — the purchasing power of the minimum wage is 17% lower than it was in 1968. Raising wages is clearly an uphill battle.

Negotiations to transform the Kingsbridge Armory in the Bronx into a shopping mall foundered recently when the developer refused to accept a provision that all tenants in the proposed mall pay their prospective employees a living wage of $10 an hour plus benefits. New York City’s Bar Assn. urged the City Council to stop linking community benefits packages with zoning approvals for new developments. The bar report also asked Mayor Michael Bloomberg to rethink his support of the concept.

Opponents of living-wage ordinances and benefit packages have real concerns. In our highly competitive world economy, individual companies or nations are only going to get pounded if they let their labor costs get out of whack with their competitors’.

But paying a living wage can benefit businesses too. A study of L.A.’s 1997 living-wage law, for instance, funded by the Ford Foundation and undertaken by LAANE in conjunction with the University of California, discovered that the ordinance had increased pay for an estimated 10,000 jobs. Employment reductions amounted to 1%, or an estimated loss of 112 jobs. Most firms gained from reduced employee turnover, which can be costly and disruptive.

Findings from such follow-up studies have gone a long way toward mitigating worries about the downside of raising wages. Yet fear of pressure on wages with our present high unemployment has led reformers to stress the urgency of coming out of the recession with a stronger workforce.

More recently, a coalition of groups led by the Strategic Actions for a Just Economy and LAANE secured a groundbreaking community benefits agreement involving L.A. Live, one of the city’s largest development projects in the last 20 years. The agreement guarantees living-wage jobs for the majority of the permanent employees in the project’s two hotels, numerous restaurants and half a dozen theaters and clubs. It also secured affordable housing for local residents and a fund for neighborhood parks from this massive complex.

Taking a pro-development stance has aligned living-wage advocates with the most powerful anti-poverty force in the world today: capitalism. Market growth in Korea, Taiwan, China, Malaysia, Indonesia and India has lifted 300 million people out of poverty during the last 30 years. And though many of the world’s most impoverished people still have no shot — yet — at any employment, much less something that pays a genuine living wage, we’ve seen remarkable progress.

There’s even light at the end of the tunnel of capital flight to impoverished areas. The pools of cheap labor that have depressed wages for the last three decades are beginning to dwindle. Chinese workers are now gaining bargaining power, achieving substantial wage increases from major employers like Honda and Foxconn, and recently, the Beijing municipal government raised the minimum wage 20%. While some producers have moved factories to Vietnam and Bangladesh, it’s only a matter of time before those places too start to understand the importance of living wages. Economic development raises expectations among workers.

Nobel laureate Muhammad Yunus, whose Grameen Bank began micro-lending, insists that one of the underpinnings of poverty is the widespread conviction that it is an ineradicable evil, like dying. “I firmly believe,” he says, “that we can create a poverty-free world if we collectively believe in it.” In a poverty-free world, Yunus has remarked wryly, “the only place that you would be able to see poverty is in a poverty museum.”

When that happens, L.A.’s living-wage advocates can take some of the credit for convincing the public that the poor need not always be with us.

About The Author: Joyce Appleby is professor of history emerita at UCLA and a member of the LAANE Resource Board. Her latest book is “The Relentless Revolution: A History of Capitalism, 2010.”


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