Reports and Research


New Studies Highlight Growing Wealth Gap

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Two new studies by the Pew Research Center show that America’s wealth gap has reached record levels.  In one study, Pew Research found that the median wealth of our country’s upper-income households was nearly seven times the median wealth of middle-income households in 2013—resulting in the largest wealth gap in 30 years since the Federal Reserve began collecting these data.

In another study, Pew Research found that wealth inequality by race and ethnicity has grown since the Great Recession. The analysis, also based on data from the Federal Reserve’s Survey of Consumer Finances, finds that the recovery from the Great Recession has been very selective, with the wealth of white households leveling off between 2010 and 2013 as the economy began to heal. The wealth of black and Hispanic households, however, has continued to decline.  The wealth of white households in 2013 was 13 times the median wealth of black households and is now more than 10 times the wealth of Hispanic households. The level of inequality between black and white households has not been seen since 1989—which makes the current racial and ethnic wealth gap at the highest level in 30 years since the data have been available.


Plight of Low-Wage, Part-Time Workers Needs to be Addressed

The death of Maria Fernandes, who juggled three jobs at three Dunkin’ Donuts stores in New Jersey to make ends meet, has cast a light on the plight of low-wage, part-time workers.  Ms. Fernandes was only 32 when she died of carbon monoxide and gas fumes from an overturned gas can while trying to take a nap in her car between shifts, and her tragic death is being held up as a symbol of our country’s low wage, part-time economy and the growing gap between the rich and poor.

Too many workers like Ms. Fernandes are struggling to survive in low-wage wage, part-time jobs with erratic schedules.  It doesn’t have to be this way.  Increasing the minimum wage and providing workers with fair, flexible, and reliable scheduling is a simple way to ensure that workers have the hours and wages needed to make ends meet.

Unfortunately, too many Congressional Republicans have turned their backs on American workers by failing to advance legislation to raise the current federal minimum wage to $10.10 an hour and index it to inflation.  And while the states and localities that have raised the minimum wage to levels higher than the current federal rate of $7.25 per hour should be lauded, providing all Americans with a living wage is an issue that must be addressed at the federal level.

Congressional Republicans have also failed to consider the Schedules That Work Act, which would provide workers with modest safeguards and begin to curb the most abusive scheduling practices. This legislation includes a presumption that workers who need a schedule change due to child care, school, a second job, or medical needs will receive that change unless there is a bona fide business reason not to. The legislation also provides workers advance notice of their schedules and guarantees minimum pay when they are sent home from work before completing their entire shift.

This is an election year and the Retail Justice Alliance urges our lawmakers to consider the millions of low-wage, part-time voters across the country who are struggling to make ends meet, much like Ms. Fernandes was, and address these two important issues.

Maria Fernandez and her family, via the New York Times

Maria Fernandez and her family, via the New York Times

Watchdog Groups, Employee-Shareholders File FEC Alleging that Walmart is Running Illegal PAC Scheme

Originally posted on Making Change at Walmart

10689753_892828714078360_4790382431542889762_nGroups are alleging that Walmart illegally pushes associates into contributing to its political action committee, circumventing a federal law that bars companies from putting corporate funds into political campaigns.

Public Citizen, Common Cause and two Walmart employees and shareholders filed a charge with the Federal Elections Committee today. In the complaint, the two employee-shareholders, Cynthia Murray and Evelyn Cruz, allege in detail a program in which Walmart reportedly solicits the company’s managers to donate to Walmart’s PAC. In exchange, Walmart reportedly pledged to donate twice the amount of those contributions to its Associates in Critical Need Trust.

This complaint argues that this program is illegal under the Federal Election Campaign Act, which bars companies from making contributions to federal candidates, parties, or PACs.

Craig Holman, government affairs lobbyist for Public Citizen noted that “WalMart is attempting to evade this law by providing a 2-to-1 charitable match from corporate coffers for any campaign contribution to its PAC from company managers. That flouts the law by using substantial corporate money to reward campaign contributors.”

In the past, the FEC has approved some charitable matching schemes, but those programs have been limited to a 1-to-1 match or less, with each donor choosing the benefitting charity-not the company as in this case.

The likes of this funding scheme by Walmart has never been approved by the FEC.  Here, the reportedly 200% matching rate provides such a powerful incentive that the campaign contributions lose their “voluntary” nature.  And these corporate contributions reportedly made exclusively to Walmart’s own charity, along with the campaign contributions to Walmart’s PAC, are simply self-serving for the company.

Murray, who has worked at a Walmart store in Laurel, Md., for 15 years and owns shares in the company, pointed out that such schemes are a fundamental challenge to our country’s democracy:

“Multibillion-dollar corporations like Walmart are able to skirt the rules that the rest of us follow. With the majority of Walmart workers being paid less than $25,000, it’s not surprising that Walmart needs to set up a fund to help employees in need. Most of us are in need every day. With more than $16 billion in annual profits, Walmart can afford to pay us more instead of paying expensive lawyers to help them manipulate electoral laws and taxpayers.” 

Like Murray said, data from Open Secrets shows that since the 2000 election cycle, Walmart’s PAC has spent over $13 million on federal elections, which has gained the company outsized influence on our democratic process.

Common Cause President Miles Rapoport says “It’s breathtaking. Walmart is running a cynical and likely illegal scheme to get its underpaid workers to help the company leverage its economic power in the political sphere.” The actions that warranted the FEC charge fall in line with Walmart’s chronically bad behavior when it comes to pushing others down and bending and breaking rules to get ahead.

Additionally, the Walmart PAC has given more than $2.5 million to members of the U.S. House of Representatives who opposed increasing the minimum wage to $10.10 last year. Among House members who voted on the proposed minimum wage increase, nearly two-thirds of the Walmart PAC’s contributions went to those who voted no. The Washington Post has reported that Walmart’s lobbying disclosures suggest it started lobbying last year on the minimum wage and Fair Minimum Wage Act, despite public statements that it is “neutral” on the issue.

Reportedly pressuring already financially-strapped employees for political donations and lobbying against increasing the minimum wage tell us one thing: it’s clear that Walmart truly doesn’t care about the well-being of its associates.

To see the FEC complaint, click here.

Widening Gap Between Rich and Poor Is ‘Unsustainable,’ New Study Finds

Income-InequalityA new study by the Harvard Business School argues that America’s wealth gap is ‘unsustainable’ and U.S. living standards must be lifted so that both businesses and workers can succeed.  The study was based on a survey of over 1,900 of Harvard Business School alumni from around the world

Titled An Economy Doing Half Its Job, the study focuses on the troubling historical economic departure from American companies and workers thriving together as they did after World War II, or suffering together as they did during the Great Depression.  Instead, the study points out, the gap between the rich and poor is widening as large and mid-size companies and highly skilled individuals have recovered and are prospering after the Great Recession, while middle and working class workers and small businesses are struggling.  The study argues that “such a divergence is unsustainable” and challenges business leaders to find ways to both profit and lift up the living standards of workers.

This new report joins a growing number of studies about the lingering effects of the Great Recession on America’s workers and the growing gap between the rich and poor.



New Reports Underscore Inequality Crisis

imagesIn the weeks leading up to Labor Day, politicians and economists are calling attention to the growing gap between the rich and poor and its effect on economic mobility and the economy as a whole.

A new report released this week by the U.S. Conference of Mayors underscores the growing problem of income inequality in this country.  According to the report, jobs lost during the Great Recession are being replaced with jobs that pay 23 percent lower—which represents $93 billion in lost wages.  Meanwhile, income gains are mostly going to the wealthiest U.S. households. The report also forecasts that income inequality will continue to persist and middle-income households will continue to fall behind unless policies are developed to mitigate these trends.

The U.S. Conference of Mayors report follows on the heels of a report released by the Federal Reserve which also reveals that a significant number of Americans are still struggling financially after the Great Recession.  The report, which was based on responses to a survey of over 4,100 people taken in 2013, shows that while a majority of U.S. households said they were “living comfortably” or “doing okay,” almost 40 percent reported that their families were “just getting by” or struggling financially.

The rating agency Standard & Poor’s also weighed in on the national conversation about the widening gap between the rich and poor and announced this month that it had trimmed its economic outlook for the U.S. due, in part, to income inequality.

Moms Fight Stagnant Wages and Precarious Work Schedules

schedyAcross the nation there is a growing conversation about the importance of raising wages and securing consistent hours for retail workers. At the forefront of the movement to improve jobs, it is increasingly common to find women leading the charge.

The retail sector employs more people than any other sector in America. The jobs it provides, primarily low-wage work, are disproportionately held by women. Many of these women have children and other dependents who also rely on their income. For this reason, Walmart moms have been at the forefront of the movement to build an economy that works for all families.

On June 6, Walmart moms went on strike during Walmart’s annual shareholders’ meeting to protest Walmart’s retaliation against workers who dare to speak out for change. Part of a larger movement through the Organization United for Respect (OUR Walmart), Walmart workers are calling on Walmart to publicly commit to implement changes that could substantially improve the lives of working parents including changes to pregnancy policy, scheduling, sick days and pay.

Walmart keeps wages low and cut employees’ hours at the expense of workers’ livelihoods and customer service. Heirs to the Walmart fortune, the Walton family, have more wealth than the bottom 42% of all Americans combined. Meanwhile, they continue to pay most of their workers less than $25,000 a year.

As the main breadwinners for their families, Walmart moms aren’t standing up simply for women or their families. They’re helping to inspire a larger movement for change that can benefit all working people.

Americans Are Still Recovering From the Great Recession, New Report Shows

The Federal Reserve’s new Report on the Economic Well-Being of U.S. Households reveals that a significant number of Americans are still struggling financially after the Great Recession.  The report, which was based on responses to a survey of over 4,100 people taken in 2013, shows that while a majority of U.S. households said they were “living comfortably” or “doing okay,” almost 40 percent reported that their families were “just getting by” or struggling financially.

The report also found that 34 percent of Americans were worse off financially compared to five years ago.  In addition—and more alarmingly—31 percent of non-retired Americans reported having no retirement savings or pension, including 19 percent of respondents in the 55-64 age bracket.

The Federal Reserve’s new report joins a growing number of studies about the lingering effects of the Great Recession on U.S. households and the growing gap between the rich and poor.



A Tale of Two Maps

Originally posted on Making Change at Walmart

Recently, the real estate blog Movoto got a lot of press attention when it released this interactive map showing the richest individual in each state. The map revealed that three Walmart heirs are the richest person in their respective states. That list includes Christy Walton (in Wyoming worth an estimated $36.7 billion), Alice Walton (in Texas worth an estimated $35.3 billion) and Jim Walton (in Arkansas worth an estimated $35.7 billion).

The Waltons should have actually held Arizona as their fourth state as well, where Rob Walton resides with $34.2 billion.

Meanwhile, the majority of Walmart workers continues to make less than $25,000 a year.  A recent article in the Wall Street Journal noted that while managers received handsome compensation for their work, Walmart cashiers made just $8.48 an hour on average. This number is in stark contrast to the national average hourly wage for cashiers of $11.22.

With such low wages and inadequate hours, Walmart workers are often pushed to rely on food stamps and other government assistance programs to get by. Earlier this year, Americans for Tax Fairness released a report estimating that American taxpayers footed the bill for $6.2 billion in government programs to help support Walmart workers who could not get by on their low pay.

When set next to each other, these two maps tell the tale of a growing gap that everyone from Pope Francis to Standard and Poor has called problematic.


New Poverty Report Underscores Need for Minimum Wage Increase

tavis talksA new report from the U.S. Census Bureau reveals that one in four people in the U.S. live in areas with a poverty rate of at least 20 percent. The report, titled Changes in Areas With Concentrated Poverty: 2000 to 2010, shows that the number of people living in poverty areas increased from 49.5 million (18.0 percent) in 2000 to 77.4 million (25.7 percent) in 2008 to 2012. Although minorities and households headed by single mothers were at the greatest risk of living in poverty, this report shows that the entire country was affected by the spike in poverty, regardless of race.

Clearly, more needs to be done to help the many Americans living in poverty and raising the minimum wage from the current federal rate of $7.25 to the proposed $10.10 per hour is a good place to start. According to Associate Professor of Economics at UMass Amherst Arin Dube, raising the minimum wage to $10.10 per hour would reduce the number of people living in poverty by 4.6 million.

Despite the numerous reports about the increase of poverty in the U.S. and academic research that shows that raising the minimum wage would reduce poverty, Senate Republicans have failed to advance legislation to raise the federal minimum wage to $10.10 an hour and index it to inflation.  This is simply wrong, and 18 states from California to New Jersey have refused to sit by, raising their own minimum wage to levels higher than the federal rate.  But that’s not enough.  All Americans deserve a living wage, and this problem calls for a federal solution.  This is an election year, and the Retail Justice Alliance urges Senate Republicans to think about the many voters in their districts who are living in poverty and raise the minimum wage.

Retail Sector Continues to Add Jobs in June, But Many are Low-wage or Part-time

good jobsWhile the retail sector continues to play a major role in adding jobs to the economy, many of these jobs are low-wage or part-time positions.  According to the Department of Labor, U.S. employers added 288,000 jobs in June as the unemployment rate fell to 6.1 percent, and 40,000 of those jobs were in the retail sector.

Although the retail sector—which is an important employer of minorities and women—has added an average of 26,000 jobs per month over the past 12 months, too many retail workers are struggling to survive in minimum wage jobs with inconsistent hours and few benefits. According to the Bureau of Labor Statistics, workers in the retail industry typically make about $10.29 per hour or $21,410 per year—which is below the federal poverty level of $23,850 for a family of four.

Academic studies show that giving retail workers access to full-time schedules, better pay and benefits could pay off for employers. Zeynep Ton, an adjunct associate professor at the M.I.T. Sloan School of Management and author of The Good Jobs Strategy, maintains that retailers such as Costco that invest in their employees—including higher pay, better benefits and schedules, and more training—have seen positive results, including healthy sales and profit growth, higher labor productivity, lower turnover and higher customer satisfaction.

Retail jobs are here to stay, and more and more workers in this industry are taking a stand for better wages and benefits.  It’s time for leaders in the retail sector to listen to their workers and lead the way in making sure that retail jobs are good jobs with benefits so that workers in this growing industry have a pathway to the middle class.