You’d think Walmart would have learned its lesson.
The big-box giant has tried unsuccessfully to sweet-talk its way into our city twice already with promises of jobs, jobs and more jobs. And now it’s knocking again, hoping to capitalize on high unemployment and a protracted recession to scare New Yorkers into thinking that Walmart – and Walmart alone – can propel our struggling communities straight to prosperity.
If history is any indication, nothing could be further from the truth. Chicago‘s struggling West Side learned the hard way that Walmart’s stores destroy more retail jobs than they create.
In 2006, the big-box retailer promised to bring jobs to the cash-strapped community. But according to a landmark study by Loyola University, the company’s rhetoric didn’t match reality: Within two years of Walmart’s opening its doors, 82 local stores went out of business.
Instead of growing Chicago’s retail economy, Walmart simply overtook it – absorbing sales from other city stores, and shuttering dozens of them in the process.
Researchers at Loyola dubbed Walmart’s store a wash – generating no new sales revenue for Chicago, and no new jobs for hard-off residents.
Chicago’s cautionary tale isn’t isolated. Countless communities, and peer-reviewed surveys across the country, all reach the same conclusion: When Walmart moves in, small businesses, and jobs, move out; Main St. dies.
According to a provisional study by David Neumark, Junfu Zhang and Stephen Ciccarella called “The Effects of Walmart on Local Labor Markets,” for every two jobs Walmart “creates,” three local jobs are destroyed.
With due respect to Walmart, this is not the kind of economic development neighborhood small businesses need.
Everywhere you look in New York, mom-and-pop shops help anchor our busiest and most vibrant business districts.
Fordham Road in the Bronx, Flatbush Ave. in Brooklyn, Jamaica Blvd. in Queens, 125th St. in Manhattan, and Forest Ave. on Staten Island are thriving proof that our city’s small businesses are the engine that powers New York City‘s economy.
For minorities and women business owners in particular, New York City is an incubator for the American Dream. A third of all businesses here are owned by women, and nearly 18% are owned by African-Americans and Hispanics – both above the national averages.
But that could easily change.
Even though New York is beginning to show signs of economic recovery, and our unemployment is below the national average, every day I talk to store owners who are struggling to stay afloat. They tell me they’re getting squeezed.
It’s no surprise, really – the Federal Reserve Bank of New York found in a survey that although small store owners are hungry for loans to grow their businesses, “75% reported receiving only ‘some’ or ‘none’ of the credit they wanted.”
Walmart is the world’s largest company with the most employee complaints. It doesn’t need our support to flourish – but small business owners like Howard Blady at Klearview Appliance on Nostrand Ave. in Sheepshead Bay do need us.
Home-grown entrepreneurs and small mom-and-pops have proven their commitment to our neighborhoods time and time again. Instead of falling for the big-box swindle and supporting their out of town competition, let’s stand by our neighborhood stores, and create more good jobs.
The only studies that support Big Wally are funded by or through Walmart; kind of like the tobacco companies’ support for cigarettes. New Yorkers deserves better. Our communities and neighborhoods deserve better.
Steven Barrison is executive vice president of the Small Business Congress of New York City, a federation of more than 75 small-business associations advocating for the rights of small enterprises across the five boroughs.
