WASHINGTON – An analysis released today by the Institute for America’s Future finds that retail behemoth Wal-Mart Inc. sucked more than $20 billion out of local economies across America this holiday season.
Despite slower-than-projected revenue growth for December, Wal-Mart still brought in $66 billion for the holiday season – more than five times the revenue of its next-largest competitor. Looking more closely, Wal-Mart’s siphoning means a loss of billions in wages and benefits paid, lost purchases of inventory, supplies and services from other local businesses, lost tax revenue to local government and lost contributions to local charities.
“America, as we know it, can’t afford Wal-Mart,” said Robert Borosage, president of the Institute for America’s Future. “People across America are starting to realize the stark reality: Wal-Mart’s triumph is the defeat of middle-class America. If Wal-Mart sets the pace, Americans will pay the price, in declining wages, rising health care costs, longer hours, worsening workplace conditions and rising personal taxes to offset soaring corporate subsidies.”
The Institute for America’s Future analysis combines today’s December retail sales report from Wal-Mart to its previously reported November sales to define the company’s overall holiday sales. The report applies that holiday sales total to research done by the Institute for Local Self-Reliance to calculate the cost to local communities.
According to a report by the Institute for Local Self-Reliance, $100 spent in locally owned businesses provides the town and surrounding area $44.60, while large retail chains only give back $14.10 to local communities, mainly in the form of wages and service. Therefore, local communities lose at least $30.50 for every $100 spent at Wal-Mart.
For this holiday season, Wal-Mart’s record-breaking sales mean staggering losses for Main Street, U.S.A.: $20.3 billion. Had that $66 billion been spent at locally owned businesses, it would have generated some $29.7 billion for local communities. However, thanks to Wal-Mart, that $66 billion translates to only $9.4 billion going into local economies.
**NOTE: Media representatives interested in a copy of today’s Institute for America’s Future analysis can obtain a copy here.**