Big Business, Corporate Profits, and the Minimum Wage

Source: National Employment Law Project, Data Brief, July 2012

From the press release:
Most of the nation’s largest low-wage employers – led by Walmart, McDonald’s and Yum! Brands – have fully recovered from the recession and are now enjoying strong profits, a new analysis of financial performance data by the National Employment Law Project shows. The report, “Big Business, Corporate Profits, and the Minimum Wage,” also finds that, contrary to frequent claims, the majority of low-wage workers in the U.S. (66%) work for large corporations with more than 100 employees, rather than for small
businesses.

The profits come at the same time that average weekly paychecks fell by 1.7% in the final quarter of last year. Additionally, the minimum wage – which helps set pay scales for these companies’ frontline workers – has not increased in three years and is now worth 30% less than it was in 1968.

According to the report, pay for the average CEO at the top low-wage employers was $9.4 million in the most recent fiscal year. The 50 largest firms also returned a stunning $174.8 billion to their shareholders over the past five fiscal years – in many cases thousands of dollars per employee per year. As stagnant wages and weak consumer demand hold the economy back, the researchers argue that the strong financial position of large, low-wage employers signals that it is time to improve wages for the lowest- paid workers and raise the federal minimum wage.

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