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Study: Wal-Mart has Positive Impact on US Economy


A study commissioned by Wal-Mart, the world's biggest retailer, finds that the Arkansas-based company generally has a positive impact on the U.S. economy. The study was released at a Washington conference on Friday.

The study done by Global Insights, a Boston-based consultancy, finds that Wal-Mart has had a positive impact on job growth in the United States. Between 1985 and 2004, for example, the study finds that Wal-Mart created 210,000 U.S. jobs. Those jobs generally paid wages below the overall norm but in line with wages paid by other retailers.

Chris Hollings, a principal author of the report, says Wal-Mart's benefits package - particularly health care - is in line with other so-called big box retailers. "At least when you look at benefits in the retail sector in general, what other retailers are doing, it was hard for us to see evidence of a real discrepancy there," said Mr. Hollings.

The report contends that the most positive impact of Wal-Mart is on retail prices. During the 19-year period, the study finds that because of Wal-Mart, U.S. food prices were nine percent lower than they would have been without Wal-Mart. Likewise, consumer prices overall would have been three percent higher without Wal-Mart.

The study does tend to agree with critics that Wal-Mart's aggressive global search for low-priced products has contributed to a loss of U.S. manufacturing jobs. Emek Basker of the University of Missouri prepared a study of Wal-Mart's purchases of products from China. "Manufacturing jobs are going to move. It's going to become more efficient to produce overseas or to purchase overseas. But retail prices are going to drop. But consumers are going to be better off, because this will lead to lower prices," said Mr. Basker.

Wal-Mart is controversial in the United States. Shoppers applaud its low prices, but trade unions complain that it pays exceedingly low wages and keeps out unions. Others charge Wal-Mart with destroying the fabric of small towns as its big box retail centers are typically built on the fringes of urban areas and its low prices often drive established smaller competitors out of business. Wal-Mart is growing rapidly worldwide. Its U.S. operations alone account for 10 percent of all U.S. imports from China.

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