5 Hard Facts About Walmart's Touted New $11 Entry Wage

STREAMWOOD, IL - JANUARY 12: A sign hangs on the door of a Sam's Club store on January 12, 2018 in Streamwood, Illinois. The store is one of more 60 sheduled to close nationwide by the end of January. (Photo by Scott Olson/Getty Images)

There's been a heavy PR campaign run by corporations to justify the massive tax cut they received from the GOP and Donald Trump. The latest entry is Walmart, with its announcement of an increased $11-an-hour entry-level wage. But, as with the other corporations, things look much different once you get beyond the press release.

In general, companies have claimed that the sudden influx of money, which will likely go to boosting stock prices (top executives and board members are shareholders, too), actually allows them to invest in employees and their businesses. But they generally follow a pattern of doing something seemingly flashy for employees that lasts a year or less following by something far more obviously moderate over time. And investments in infrastructure or new business directions are on a par with what the companies had previously done.

How much is $11 worth these days?

Don't misunderstand, any increase in the entry level wages with an employer of Walmart's size is good. The lower the wage, the more likely people will need public assistance of some kind. Whether you want to call these subsidies to employees rather than employers, it is still subsistence money, not munificent remuneration. Having the government deliver it means employers pay less directly and still have workers live through the night to show up the next morning, which is why it's rightly called an effective employer subsidy, just as specialized and targeted massive tax breaks and loopholes are direct subsidies.

So, how generous is $11 an hour? I remember working in the trucking business in the early 1980s. There were trucker's helpers who would ride along and help load trucks and deliver furniture. They got a flat daily rate that worked out to $5 or $6 a 10- to 12-hour day.

It was low pay. In 1983, the average hourly income was more than $8, according a Federal Reserve Bank of St. Louis compilation of Bureau of Labor Statistics data.

The Bureau of Labor CPI inflation calculator says that $5 in January 1983 was the equivalent of $12.60 in December 2017. The average wage in December was $22.30.

In 1983, $5 an hour was poor pay and $11 is today.

Part of a long-term plan

Although some have taken the $11 an hour number as a big jump for the company, it isn't, nor is it sudden. In January 2016, Walmart announced that new hires would receive $9 an hour and then move to $10 "after successfully completing the company’s new retail skills and training program known as Pathways." The average part-time hourly wage then was $10,58 an hour and full-time was $13.38.

How much is $11 worth these days?

Don't misunderstand, any increase in the entry level wages with an employer of Walmart's size is good. The lower the wage, the more likely people will need public assistance of some kind. Whether you want to call these subsidies to employees rather than employers, it is still subsistence money, not munificent remuneration. Having the government deliver it means employers pay less directly and still have workers live through the night to show up the next morning, which is why it's rightly called an effective employer subsidy, just as specialized and targeted massive tax breaks and loopholes are direct subsidies.

It was low pay. In 1983, the average hourly income was more than $8, according a Federal Reserve Bank of St. Louis compilation of Bureau of Labor Statistics data.

The Bureau of Labor CPI inflation calculator says that $5 in January 1983 was the equivalent of $12.60 in December 2017. The average wage in December was $22.30.

In 1983, $5 an hour was poor pay and $11 is today.

Part of a long-term plan

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