Sunday, July 02, 2006

The Wal-Mart Effect by Charles Fishman - 2

Jobs and Manufacturing
While Wal-Mart was adding 480,000 jobs between 1997 and 2004, US manufacturing jobs during those years fell by 3,100,000 jobs, a loss of 37,000 factory jobs a month, on average, for eighty-four straight months.

...during the last 7 years, a remarkable milestone has passed all but unnoticed: In 2003, for the first time in modern US history, the number of Americans working in retail (14.9 million) was greater than the number of Americans working in factories (14.5 million). We have more people working in stores than we do making the merchandise to put in them. .....Just ask the residents of Peoria, who used to make lawn sprinklers for L.R. Nelson.
K-Mart and Target and Sears etc. also sell clothing made overseas is commonly pointed out by Wal-Mart supporters. Yeah, they do. But who shipped the jobs overseas. That would be the largest company on earth wouldn't it?

Rural Effects
In towns with a Wal-Mart, sales of general merchandise leaped dramatically compared to the state average, up 55% per capita after three years. In the 45 small towns within twenty miles of a Wal-Mart, total sales dropped 13% after 3 years, nearly double the decline for similar Iowa towns that weren't near a Wal-Mart.
But even in towns with Wal-Mart stores driving dramatic increases in the retail trade, there were losers. Grocery stores lost 5% of their sales after 3 years; specialty stores - drugstores, clothing stores, toy stores, and the like lost 12% of their sales after 3 years. Even service businesses in Wal-Mart towns lost business - down 13% after 3 years.
The entire report of Wal-Mart's effect on rural communities by Dr. Ken Stone can be found under the links to the left.

Stone updated his study in 1993.
Across the rest of the retail landscape, the arrival of Wal-Mart coincided with a swath of destruction. Grocery stores lost 5% of their business after 5 years; specialty stores lost 14% of their business, and clothing stores lost 18% of their business - all while total sales were rising 6%, mostly due to Wal-Mart.
In towns that were nearby but didn't have a Wal-Mart, Wal-Mart vacuumed customers away: clothing stores lost 13% of their business after 5 years; specialty stores lost 21%.
...small Iowa towns, with populations between five hundred and one thousand, lost 47% of their retail sales....
...43% of all stores selling men's and boy's clothing went out of business. Neary half of an entire retail category in a state was wiped out.

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