Ralph Nader: Walmart Support a Minimum Wage Raise

Consumer Advocate Ralph Nader Calls on Walmart to Support Raising the Minimum Wage, Help Jumpstart Economy and Increase Consumer Spending

In 2005, Walmart first expressed its support of increasing the minimum wage. Consumer advocate Ralph Nader sent a letter to Walmart CEO, Mike Duke today calling on the corporation to again support raising the minimum wage to help jumpstart the economy and increase consumer spending.

“The inflation-adjusted value of the minimum wage has been in decline since the 1960’s, leaving hard-working Americans across the country with less and less disposable income,” said Nader. “This could not only help start our economy on the path to recovery, but could have a significant impact on the spending and purchasing power of Walmart customers in particular,” he continued.

Nader said that raising the minimum wage to $10 per hour would benefit 30 million workers. Nader cited a 2011 Chicago Federal Reserve Bank study that found that for every dollar increase to the hourly wage of a minimum wage worker, the result is $2,800 in new consumer spending annually from that worker’s household. A 2009 Economic Policy Institute study estimated a minimum wage increase to $9.50 would add $60 billion in spending over two years.

Nader also highlighted a UC Berkeley study, “Living Wage Policies and Big-Box Retail: How a Higher Wage Standard Would Impact Wal-Mart Workers and Shoppers” to demonstrate that raising employees’ wages would have a minimal impact on either Walmart’s own costs or on its “everyday low prices”. Nader explained that the study shows that if Walmart were to absorb 100 percent of the cost of increasing wages, it would represent a miniscule 0.25 percent of their annual U.S. sales. Conversely, if Walmart were to pass 100 percent of these costs on to the average Walmart shopper, it would only add about $0.11 per trip.

Nader concluded the letter by looking back at 1914, when, in the midst of a deep recession, Henry Ford more than doubled the wages of his workers. Some years later, Ford said:

“If you cut wages, you just cut the number of your own customers. If an employer does not share prosperity with those who make him prosperous, then pretty soon there will be no prosperity to share. That is why we think it is good business always to raise wages and never to lower them. We like to have plenty of customers.”

A full copy of the letter can be found on  here: Walmart Minimum Wage Letter.

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