Wal-Mart Stores, Inc. (NYSE:WMT) pledged yesterday to hire more vets and also buy more American-made goods, but what does this mean for their employees and for the American population as a whole? After all, hiring veterans is good, but does a job at Wal-Mart really give them a leg up? And what about their decision to source more American-made goods? Does the company receive any other benefits besides good PR?
Let’s start by examining the pay a veteran could expect if hired by Wal-mart. ABC News did a breakdown of what a vet hired by Wal-Mart Stores, Inc. (NYSE:WMT) could expect if he or she went to work there. It found that the average annual pay for a full-time hourly Wal-Mart worker is around $26,000. If the vet is supporting a family of four, that’s just barely above the federal poverty level.
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For W-1 vets who have eight years of experience, working at Wal-Mart isn’t such a good deal. The average salary for them with the U.S. military is just over $45,000. On the other hand, for E-1 active duty soldiers who have less than two years of experience, working at Wal-Mart looks a little attractive until you read between the lines. Their average military salary is a little over $18,000, although they also receive free room and board, plus health benefits.
And then we get into health insurance costs. Reuters reports that Wal-Mart Stores, Inc. (NYSE:WMT) pays for preventative care for its employees, although most workers have a deductible of $1,750 or higher before the company will pay for 80 percent of the cost of other types of care. The health insurance plans cost Wal-Mart employees between $17 and $60 every two weeks, and that’s only if they’re single. The cost goes higher for employees with families.
Experts say Wal-Mart Stores, Inc. (NYSE:WMT)’s efforts to hire veterans are commendable, but they do leave something to be desired for most vets, who want to have more to look forward to than low paying work. Wal-Mart’s CEO said veterans who do start out as associates at the retail giant can work toward becoming store managers. He points out that 75 percent of those who end up being store managers started out working as associates. The average pay for a store manager ranges from $50,000 to $170,000 per year, so it does certainly offer a brighter future for vets who choose to stick around.
Now let’s look at the company’s decision to buy more American-made goods. On Tuesday the retail chain extended an incentive to suppliers, saying that it would add $50 billion in American-made products to its shelves within the next decade. The company didn’t say what value it currently stocks in American-made goods, although we do know that it spent $335 billion in its last fiscal year buying and moving goods around the globe.
Wal-Mart’s decision to buy more American-made goods could boil down to a simple change in the company’s bottom line. While in the past it was less expensive to buy goods overseas, those costs are rapidly rising, making it less expensive to produce goods in the U.S. So Wal-Mart Stores, Inc. (NYSE:WMT) is essentially working with manufacturers looking to bring their production facilities to the U.S. anyway. Nonetheless it makes for good PR to tell Americans that it wants to bring production back stateside.