Wal-Mart Summary

Provide a detailed summary of the article by Dube and Jacobs (2004). You need to pay attention on how Wal-Mart is believed to benefit from society instead of helping communities. You also need to include the methodology that the study used to arrive to the conclusions. In addition you should document the findings and study conclusions. Your summary should be at least 100 words long (Note: essays that are 200 words and longer have a better shot in addressing the question fully). Shorter summaries will not receive full credit. [10 Points]. Cut and paste work will receive zero credit.

The intention of Dube and Jacobs’s study is to find the hidden costs of Wal-Mart and determine if Wal-Mart is a good or bad thing for California. Dube and Jacobs’s note in their findings, “a state survey found that Wal-Mart employees rely disproportionately on the state’s Children’s Health Insurance Program, PeachCare”. When doing secondary research Dube and Jacobs’s found a report that was used by the Committee on Education and the Workforce of the U.S. House of Representatives which stated that, based on their research they found that the typical Wal-Mart store with 200 employees cost the federal government taxpayers $420,750 per year due to Wal-Mart employees enrolling in federal assistance programs. Dube and Jacobs’s explain on page 2 of their study, that even though Wal-Mart may add a significant number of jobs, they are replacing jobs that were previously higher-paying jobs. According to page 8, Wal-Mart employed 930,000 employees nationally in 2001; roughly 44,000 of those are in California alone. Dube and Jacobs’s show in Figure 1: Wal-Mart Wage Distribution, 54% of Wal-Mart employees earn under $9.00 per hour; 21% earn between $9.00 and $9.99 per hour; 16% earn between $10.00 and $10.99 per hour; and 9% earn $11.00 and over. These wages are far below the retail industry average, which was noted in Figure 2: Average Wages-Wal-Mart versus All Large California Retailers, which shows that the average wage for a Wal-Mart employee is $4.31 below the average wage of employees working for large retailers in California. Next, Dube and Jacobs’s looked at employment based health insurance coverage in California. They found that in California, less than half (48%) of Wal-Mart employee had employment based health coverage; this is compared to the 61.1% of employees at all the other large retailers in California. Dube and Jacobs’s estimated the amount of money that Wal-Mart is receiving from taxpayers by looking at 1. wage and benefit information about Wal-Mart workers, and 2. a statistical model of public assistance utilization. They then needed to simulate data for Wal-Mart. Since Wal-Mart is a privately held company, they are not required to publish any financial data or employment statistics. Therefore, Dube and Jacobs’s simulated data for Wal-Mart based on statistical data that has been reported on for the other large retailers