Is Wal-Mart coming to Moab/Grand County? If so, what effect would it have on the area? R. Lance Christie has some insight:
A Wal-Mart Supercenter siting in Grand County is likely to damage our overall local economy for two reasons:
First, in 2002 the Austin Independent Business Alliance commissioned a report by Civic Economics, an economic analysis and strategic planning consultant. The question Civic Economics was asked is, has siting "big box" retail stores raised or lowered total tax revenues to the jurisdictions in which the stores were built?
The report found that, depending on the siting of the "big box" chain store, it could lower the total tax revenues to a community from retail activity. If "big box" chain stores are sited in large shopping campuses with many different, complimentary stores, overall shopping traffic increases as shoppers going to one store also browse and buy at neighboring stores, and total tax revenues go up. If a "big box" chain store is sited away from a shopping campus of complimentary retail stores, it tends to draw customers away from other businesses and causes a drop in overall tax revenues to local government.
The Austin report says the reason for the drop in total local tax revenues lies in what happens to the revenue stream from chain "big box" versus locally-owned stores. With a chain store, essentially the only money that remains in the community is that paid to local labor hired by the store. The rest goes to the national headquarters, with profits being distributed to shareholders around the world. With a local merchant, more money stays in the community in the form of salaries to management as well as staff; purchasing local accounting, advertising and other business services; and expenditure of some of the profits from the store locally by owners.
Second, we are told that an average Wal-Mart Supercenter here employs between 350 and 500 employees, 70% full and 30% part-time., with full-time employees starting at an average of $10.59 per hour nationally with health benefits costing the full-timer an average of $22 per month. Most of the wages among existing employers in Grand County: hardware stores, banks, grocery stores, landscapers, as well as the tourism hospitality businesses, run below $10.50 per hour without health benefits. According to Workforce Services, 40% of local jobs paid less than $8 per hour this June. In June there were over 300 vacant jobs, 177 full-time and 38 year-around; 123 offered $10 per hour or less. In 2006 we had fewer warm bodies in jobs in Grand County than we had in 1999: the workforce is shrinking slightly as new workers can't afford to move here because of high housing prices, replacing people who leave or retire. If a Wal-Mart opens here, I expect we will hear a "giant sucking sound" as the store poaches employees from existing businesses of all types. This will drive a large number of these businesses over the edge into closing, because as we learned at the June 22 "labor summit" meeting here, local businesses are already stressed and faltering from inability to hire enough staff.
As was pointed out by Lisa Roman at the labor summit, the official projection of the number of new residents moving into Grand County by 2010 is less than the number of vacant jobs now, even if all the new residents were available for workforce employment here. In fact, these are folks who can afford to pay the Grand County median new house price of a quarter million dollars with money they earn from somewhere else, and except for a few teenage kids, my bet is that none of the new resident family members in the next four years will end up in a job here. None of the non-resident people who bought new houses here since 2000 have taken workforce jobs here.
The "bottom line" is that, if Wal-Mart opens here, it will be on an isolated campus north or south of Moab, it will compete with all local employers for a shrinking workforce, and it will likely cause a net reduction in local tax revenues even if overall county retail sales increase. Under these conditions, local governments should not offer any inducements or bend any rules to get a Wal-Mart to open here. If Wal-Mart can find a suitable site for an acceptable price and build on it without getting any zoning changes or variances, so be it - they are entitled to equal treatment under the law. But it is clear to me that a Wal-Mart would have a negative effect on our local economy overall because of our peculiar local housing and labor conditions, and we should discourage a store siting here by any legal means available.
Sincerely yours,
Lance Christie, Moab
December 2, 2006
Letters to the People
Moab Times-Independent
Dear friends,
Labels: Lance, Moab, Wal-Mart
0 Comments:
Post a Comment
<< Home