Report: Walmart Workers Cost Taxpayers $6.2 Billion In Public Assistance

Editorial by, Clare O’Connor

Forbes Staff

Report: Walmart Workers Cost Taxpayers $6.2 Billion In Public Assistance – Forbes

Walmart’s low-wage workers cost U.S. taxpayers an estimated $6.2 billion in public assistance including food stamps, Medicaid and subsidized housing, according to a report published to coincide with Tax Day, April 15.

Americans for Tax Fairness, a coalition of 400 national and state-level progressive groups, made this estimate using data from a 2013 study by Democratic Staff of the U.S. Committee on Education and the Workforce.

“The study estimated the cost to Wisconsin’s taxpayers of Walmart’s low wages and benefits, which often force workers to rely on various public assistance programs,” reads the report, available in full here.

“It found that a single Walmart Supercenter cost taxpayers between $904,542 and $1.75 million per year, or between $3,015 and $5,815 on average for each of 300 workers.”

Americans for Tax Fairness then took the mid-point of that range ($4,415) and multiplied it by Walmart’s approximately 1.4 million workers to come up with an estimate of the overall taxpayers’ bill for the Bentonville, Ark.-based big box giant’s staffers.

The report provides a state-by-state breakdown of these figures, as well as some context on the other side of the coin: Walmart’s huge share of the nationwide SNAP, or food stamp, market.

“Walmart told analysts last year that the company has captured 18 percent of the SNAP market,” it reads. “Using that figure, we estimate that the company accounted for $13.5 billion out of $76 billion in food stamp sales in 2013.”

Walmart spokesperson Randy Hargrove described this week’s report as “inaccurate and misleading,” referring to its use of extrapolated data and adding that public assistance program eligibility requirements vary from state to state.

“More than 99 percent of our associates earn above minimum wage,” he said. “In fact, the average hourly wage for our associates, both full and part-time, is an average of $11.83 per hour.”

He said the company had no internal figures to share on the number of workers receiving public assistance.
“The bottom line is Walmart provides associates with more opportunities for career growth and greater economic security for their families than other companies in America,” he said. “Our full and part-time workers get bonuses for store performance, access to a 401K-retirement plan, education and health benefits.”

Hargrove added that the number of Walmart employees receiving Medicaid is similar to the percentage for other large retailers — and comparable to the national average.

He pointed to a 2005 report by economist Jason Furman, now a White House adviser, describing Walmart’s Medicaid enrollment as “a reflection of [its] enormous size.”

Other large retail chains have been the focus of similar reports in recent months. In October, two studies released to coincide showed that American fast food industry outsourced a combined $7 billion in annual labor costs to taxpayers. McDonald’s MCD +0.35% alone accounted for $1.2 billion of that outlay.

Yum Brands came in at a distant number two, with its Pizza Hut, Taco Bell and KFC subsidiaries costing $648 million in benefits programs for workers each year.

2 thoughts on “Report: Walmart Workers Cost Taxpayers $6.2 Billion In Public Assistance”

  1. Mr Joe, thank you for your comments on self check out and the welfare nanny in this country ‘Walmart’. That being said, It would be great if you could manage to find more than 2 cashiers out of the 10 check out counters that go unmanned, let alone get a position as cashier, due to the practice of self check out growing at a feverish pace at giant big box stores. If you believe that giving 100 percent to Corporate Americas company’s will require a BIG ladder than you haven’t had the experience of working for one in many years. I to was in business for almost 30 years and felt like you. For the better half of 10 years now I have had the opportunity to witness firsthand how these giant corporations have evolved into nothing short of demoralizing their workforce with unfair wages for the work they do. I myself can speak firsthand about this. Although I do not need to survive on my paycheck due to the fact that I have alternate income, I can assure you I give 110 percent at my job as an aircraft fueler for one of the biggest petroleum companies in the world. Although we are constantly reminded of the danger and responsibility that comes along with our job as a fuel for the airlines, not to mention the monthly testing required by each airline to stay current in our fueling position , I like most of my coworkers have climbed the ladder to the respectable salary under $11.00 an hour. However most of my coworkers are still below $11.00 after working for over two or three years. As you say companies will raise prices if forced to pay higher wages. This may be so. However one must think that there’s something wrong when corporations continue yearly to make record profits on the backbone of their front line soldiers without having that show up in their paycheck. If you believe that the American public needs to subsidized big box stores like Walmart in the form of public assistance to the majority of the workers due to their inability to survive on the totally out of proportion wages that are being doled out to them, then you are obviously missing the point due to the bubble that you presently live. If America is going to survive and continued to be an economic model for the rest of the world then we must practice once again incentivizing employees hard work and loyalty to their job with equal compensation.
    Unfortunately this is not the case in today’s corporate agenda. Rather I see the destruction of the once proud work ethic that made this country great.

    Thanks again for your comments.

  2. Once again….you blame the employer who is NOT breaking any laws set by our elected officials…..which by the way ( if you vote) are elected by us…the real discussion and change needs to be had in Washington…but be careful…let’s say a can of beans costs $.99 at Walmart…that same can of beans will cost more with a higher wage…it will be passed soley to the consumer….these minimum wage jobs are available for two reasons…1.. There is a large enough pool of workers to fill them…2… The skill set of the employee does not allow them to work for more money some where else…..sorry…but the truth hurts…in this case you need to fight city hall and stop whining about Walmart and corporate America….peace to ALL

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