Hughes, 47, from Malvern, Arkansas, said that food is stressful. “I think all the time: ‘What am i going to buy when [work] ends? That I can afford?” It’s hard to know what I’m going to buy.
All day, I think: “What can I afford to buy?” It’s hard to know what I’m going to buy.
Hughes discovered that as prices have risen due to pandemic-driven inflation, her grocery budget has virtually dropped to zero. Fast food is now the only viable option for survival. According to the Bureau of Labor Statistics (BLS), the cost of a pound of ground meat rose 19% between January and October. Hughes was not paid an increase in her hourly wage last year. Walmart increased her pay by $1. This amounts to an approximate 8 percent increase. Walmart’s September wage increases put Hughes at 85 cents more than the standard starting salary.
Hughes stated that “it’s worse now because the prices have gone up so much.” Hughes said, “I cannot even afford to buy groceries.”
Walmart refused to comment on wages of specific employees. The company increased its starting wage to $12 to $17 an hour depending on the market. Specialty roles such as store bakers can get up to $34 and go up to $34. According to the company, the average hourly wage is $16.40.
According to the BLS, consumer prices rose by 6.2 percent in the 12 months ending October. According to the latest data from the department, wages and salaries increased by only 4.2 per cent in the twelve months ending in September.
However, the gap between wage growth rates and inflation does not mean that all consumers feel the effects of higher prices on their pockets. The most affected are those with the lowest incomes. According to the latest data from BLS, the median hourly earnings of retail sales workers in May 2013 was $13.02 per hour. That’s $27,172 in full time annual wages. Computer and IT workers earned a median annual salary of $151,150.
Nela Richardson (chief economist at ADP payroll processing company) stated that the main message for the hospitality and retail industries is that real wages aren’t keeping up with inflation, and these jobs are barely walking water. As you earn more, price rises take less of your budget. Inflation can make a significant impact on your overall income if you have a lower salary.
Inflation can make a significant impact on your overall income if you have a lower salary.
The economic divide between those who can work from home or those who cannot was highlighted by the pandemic. According to a September report from a federal advisory committee to the secretary for health and human services, those who couldn’t work at home (bus drivers, retail workers, delivery workers) were more likely than others to contract the coronavirus. They also had less chance of having savings or benefits in case they got sick. In addition, they were more likely lose their income. The United Food and Commercial Workers International Union collected data that showed that 198 of the 835,000 grocery workers were killed by Covid-19. At least 43,900 people were either infected or exposed between March 2020 and August 2021.
The grocery industry saw record sales as people stayed home to prevent the virus from spreading. According to McKinsey and Co., the industry typically grows between 1 and 2 percent per year. The North American grocery industry saw a staggering 12 percent increase in sales last year. According to Kroger, Kroger’s sales reached $135 billion last year. This is 10.6 percent more than the $122 billion Kroger reported in 2019. Costco’s sales increased by 9 percent to $163 billion last year from $149 billion in 2019. Walmart’s food sales increased by $3.6 billion during the third quarter, which was the highest quarterly growth in six years, Walmart’s chief financial officers told investors last week in an earnings call.
Bianca Agustin is the corporate accountability director for United for Respect. She stated in an email that rising costs for low-wage earnings are “an urgent reminder for Congress” to increase the federal minimum wage to $15.
She stated that this is “the minimum necessary to ensure that essential workers and their families are included in the recovery.”
As the severe pandemic has forced Hughes and other grocery workers to the frontlines of the virus, there has been a wave in calls for raising the federal minimum wage. This has also led to political animosity towards safety protocols such as masks. Some retailers increased their sick leave benefits to cover the additional risk of contracting the disease, and added hazard pay for frontline workers as a result. This was done a few months after the outbreak. Albertsons, Kroger, and Fred Meyer were among the grocers to have stopped receiving bonus payments for their work through the pandemic.
Retail workers started leaving the industry as a result of low wages, burnout, and the pandemic was now one year old. According to the Labor Department, 730,000 retail workers left their jobs in August while 685,000 did so in September. Retail companies responded by increasing wages and enhancing benefits to attract workers to fill the growing number of available positions. Costco increased its minimum hourly wage by $17 last month. Natural Grocers announced last month that they will increase their starting hourly wage from $14 to $18. Aldi announced that its starting hourly wage will increase to $15 in August.
Gary Burtless is a Brookings Institution senior economist in economic studies. He stated that wage increases are encouraging signs. “Although it’s not widespread enough for the economy to reflect, it’s there at the moment.”
In the meantime, rising consumer demand, a global supply crisis, and labor shortages have all contributed to higher prices. Last month, price inflation reached 6.2 percent. This is its highest level in over 30 years.
Richardson stated that the September wage increase for workers in the hospitality sector was 1 percent higher than the previous year. She said that retail and trade wages increased by 6.7% in September, compared to last year. This means that wages in this sector are barely keeping pace with the price increases.
Many grocery workers are faced with the reality of having to eat food they cannot afford every day because of the gap in hourly wages.
Hughes stated, “It’s horrible checking out baskets and bags of groceries knowing that I can’t purchase them.”
It is horrible to look at baskets after basket of groceries, knowing that I won’t be able to buy them.
Richardson stated that while job-switching can lead to higher wages for some workers, it’s not common for others. He said that leisure, hospitality, and retail are distinct segments because moving jobs is often less profitable than in other industries. Some workers are willing to sacrifice the few benefits they receive from their grocery companies for higher-paying jobs that offer fewer benefits.
According to a Kroger supervisor in Tennessee, she requested anonymity because she isn’t allowed to talk to the media. She said that she skips breakfast often and only eats two crackers to stretch her money. While she is enrolled at a community college, her hourly wage is $10. The benefits of the company are more important to a college student than the low salary.
She said that she had looked at other job options. Kroger offers certain benefits I would like in the event that I need them. For example, I have health insurance and tuition reimbursement if my school scholarship is canceled.
Kroger spokesperson Kristal Howard stated in an email that Kroger has invested $800million in wages and training in the past three years. To raise the average national wage to $16 an hour, it is increasing its investment by $350 million this year. It also offered one-time bonuses related to the pandemic of $1,200 for workers who are part-time and $1,760 for workers who are full-time.
Hughes stated that she considered leaving Walmart, but she only earned full-time status last year at Walmart. This comes with both long-term and short term disability benefits.
She said, “It’s difficult to even pay my bills and make ends meet.” It’s about budgeting and figuring out how I can afford food.
