Dear corporations, we’ll trade you a few cents for a better life
The relationship between America’s corporations and their low-wage employees bubbled to the front of cultural dialogue this week, with McDonald’s unveiling a completely impossible budget for its workers’ monthly expenses and Walmart announcing they would nix plans to open Washington, D.C., store if forced to pay a living wage of $12.50 an hour.
The struggle isn’t new—the lower end of America’s workforce has been languishing for decades while the top flourishes. The solution we need may not exactly be a new idea either:
Last year Papa John’s CEO John Schnatter warned that Obamacare would be a disaster for business because, if forced to insure his workers, it would raise the price of a large pizza by 11 cents for the consumer. This isn’t hyperbole, he actually said this: “Our best estimate is that the Obamacare will cost 11 to 14 cents per pizza,” Schnatter said, “or 15 to 20 cents per order from a corporate basis.”
That’s right—15 to 20 cents for every order and all Papa John’s full-time workers can have health care. What’s really interesting is that in corporate America’s view—as embodied by Papa John’s CEO—this 15 to 20 cents is a disaster, likely because he thinks it’ll hurt sales.
But 15 to 20 cents is not nearly enough to hurt pizza sales. We’re talking about a consumer base that gladly pays $5 for coffee.
In light of the recent corporate news a 2011 study by UC Berkeley has resurfaced showing that Walmart could increase pay for all of its 1.4 million workers a living wage of $12 per hour and it would cost each Walmart shopper 46 cents per shopping trip.
As a particularly clever video on Reddit today says, “46 cents is not going to stop me from going to Walmart, especially if they’re the only store that carries the $24 pot steamer I need to steam my vegetables.”
This is the age of crowd-funding. A time when random strangers will give a woman over $700,000 because she was bullied by some heartless preteens. Americans have empathy. They want to help others and they want to help themselves. Not only would Papa John’s and Walmart not lose customers by raising prices 11 cents per pizza or 46 cents per shopping trip, they would engender massive good-will from American customers whose new-found loyalty would help keep these companies in the black.
And with inflation remaining low despite the Fed’s stimulus, American companies can do this now without worrying about squeezing consumers’ spending power.
This isn’t just speculative—companies can look to Starbucks as a model example for how to treat workers decently without losing customers. Starbucks pays hourly workers respectably, provides healthcare and even paid vacation days after 12 months with the company. And it hasn’t made Starbucks fall behind the competition—not even close.
The volume of online dialogue this week has been gratifying. Corporations should listen. The message is loud and clear: We the American consumer, will trade you a few cents for a better life.
top image via GG2Net