From Opinion Journal – “Hard Line State – Big Labor’s war on Wal-Mart claims casualties among poor Marylanders”:
The consequences of our Legislature's override of Republican Gov. Robert Ehrlich's veto of their "Fair Share Health Care Act" on Jan. 12 will be tragic for some of the state's neediest residents. The law will force companies that employ over 10,000 to spend at least 8% of their payroll on health care or kick any shortfall into a special state fund. Wal-Mart would be the only employer in the state to be affected.Those lost jobs in Somerset would have boosted the county’s tax revenues by over $19 million on employee compensation topping over $46 million. I wonder if Wal-Mart will shutter other stores until they employ exactly 9,999 Marylanders.
Almost surely, therefore, the company will pull the plug on plans to build a distribution center that would have employed 800 in Somerset County, on Maryland's picturesque Eastern Shore. As a Wal-Mart spokesman has put it, "you have to take a step back and call into question how business-friendly is a state like Maryland when they pass a bill that . . . takes a swipe at one company that provides 15,000 jobs."
5 comments:
If I was on the Wal-Mart board that is exactly what I would do - close just enough stores in the state to get below the 10,000 threshold.
I doubt Wal-Mart will scale back.. the only way they can make money is to sell more product or raise prices
being the low-cost leaders, they pinch every penny and squeeze their vendors hard.. I doubt they could get away with raising their prices 8 percent across the board
and they can't sell more with less stores.. so they've gotta keep open as many stores as possible.. however, that doesn't necessarily mean they have to hire as many full-time employees (generally part-time employees fall under different rules regarding benefits)
or, if I'm wrong about that, and part-timers still factor into the figure the state goes by, then they'll replace 2 or 3 PT helpers with FT employees, thus covering their bases with less people
another area to cut back on is in distribution and administrative centers, which can be farmed out to independent contractors.. or moving those services entirely out of state
either way, the state loses jobs and income from Wal-Mart
No fans of a living wage here? No one? Okay, just checking.
There are reasons Wal-Mart's been unable to get into big cities like Los Angeles, New York City or Chicago, whereas similar businesses like Costco or BJ's are successful there.
I wondered about how many store it would have to close to drop below the 10,000 threshold, but yesterday I came across the figure of 15,000 as the number of Walmart employees in MD. That would be too many to let go, realistically. So Walmart is kind of stuck. But they may pare back the lower-performing stores, and less likely to open new ones.
It's unfortunate that Democrats have declared war on the country's largest private employer.
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