Wal-Mart workers vote with their feet.
As my first papers aren’t due yet and my manuscript is sitting at the publisher waiting for the outside reviews to come back, I’ve been doing a lot of reading lately. Oddly enough, two of my favorite recent books, The Shock Doctrine by Naomi Klein and The Big Con by Jonathan Chait, both have the same overarching theme: Free market capitalism (whatever that really is) isn’t very popular. Klein takes us all over the world while Chait stays entirely in the United States, but the picture they present is quite similar. In order to deregulate or privatize or defund the government through extraordinary tax cuts, obfuscation or outright lying is an absolute necessity, otherwise the people doing it tend to get voted out of office.
With this as a background, I was more than prepared to read an interview with Richard Vedder (You remember Richard Vedder, don’t you?) this morning. Here he is again in the Carolina Journal:
Wal-Mart has — employees have always felt it was a nice place to work, and they’ve had — unions have had a hard time organizing the company. And because of that, they have mounted attacks on Wal-Mart—others have joined in, to be sure—and have made this a target in terms of criticism.
Wal-Mart employees have always felt it was a nice place to work? I actually read the Wal-Mart Revolution and I don’t think he and his co-author went that far? The reason for doing it is easy when you think about it. While Wal-Mart is funding the Think Tank that pays him for this kind of “expertise,” I suspect Vedder would make this argument for free. If the biggest, baddest union-busting company in the country is actually full of happy workers, then there’s no need to reform labor law to make organizing easier and his economist’s utopia of unregulated capitalism would be a little closer.
The thing is, there is absolutely no evidence that Wal-Mart “employees have always felt it was a nice place to work” and plenty of evidence to the contrary concerning turnover. Since non-union workers do not have the power to influence the terms and conditions of their employment, the only way they can express their true feelings about their working conditions is to quit. And as I’ve written many times here, turnover at Wal-Mart is extraordinarily high. Here it is again from a study by the Wal-Mart Alliance for Reform Now and the Wal-Mart Workers Association (footnotes omitted):
Based on Wal-Mart’s own reports about the number of workers it employed at various points during the quarter, WARN estimated that approximately 74,300 Florida Wal-Mart workers occupied their positions for the entire quarter. Another 15,500 positions turned over at least once during the quarter, while some 2,900 more were created as a result of the opening of new stores. This represents an alarmingly high quarterly turnover rate of 17.3% (see Chart 3). In other words, if that rate were valid at present, one could expect that at least one in every six faces you saw during a visit to Wal-Mart today would be different on a return visit three months from now. If the turnover calculation included consideration of every worker that occupied a position during the quarter (i.e., factoring in multiple turnovers), the annualized turnover rate would be 75%! This rate is far more brisk than at other large companies, even within the retail sector. For example, the turnover rate at rival Costco, as estimated by Smith Barney Citigroup Research, stands at only 23%. And although such a turnover rate seems untenable, workers and former workers have told WARN that such turnover rates are the longstanding norm in many stores.
To be fair, I’m sure there are plenty of workers at unionized companies that don’t like their jobs, but at least with a union you can have some say over the terms and conditions of your employment. All Wal-Mart workers can do is vote with their feet, and despite few options for less-skilled workers in this economy they’re voting thumbs down in droves.
Why can’t Richard Vedder see this? It isn’t rocket science. I suspect the answer to that question has something to do with the fact that if Vedder actually faced the reality that is Wal-Mart, he’d have to admit that his free market view aren’t nearly as popular as he thinks they are.
[...] Labor Relations Act isn’t going to help the angriest of workers. Wal-Mart workers regularly vote with their feet against the company because that’s the only safe means to express their [...]
[...] will be around, until it isn’t and with an annual employee turn-over rate hovering near 50 percent, the 300 people who did find jobs shouldn’t feel all that [...]