Eye-Opening Data Shows Why Everything You Buy Is More Expensive And Who’s Profiting The Most

For every $100 in sales, the average discount retailer like Walmart and Target earns $3.10 in profits, while the average take for the states with state and local sales taxes is more than twice that amount — almost $7, based on the 6.94% average sales tax rate for the 46 states that tax retail sales.

Some high-tax states like Tennessee (9.45%), Arkansas (9.2%), Louisiana (8.9%) and Washington (8.9%), take in more than (or almost) $3 in state and local sales taxes for every $1 in retail profit.

But look at who attracts the protests and boycotts….

Who Boycotts Walmart — which makes a modest 3.12% profit margin by helping to feed and clothe people who typically do not have a lot of spare money? Social-justice warriors who are too enlightened to let their poor neighbors pay lower prices, according to National Review’s Kevin Williamson.

Meanwhile, contrary to widespread belief, big-box stores and chains like Walmart have increased wages in the retail sector as they have spread, according to a recent NBER paper Do Large Modern Retailers Pay Premium Wages? Here’s the paper’s conclusion:

Over the last forty years, modern retail firms, those with the modern products and processes that support large chains, have become a large segment of the retail sector. Using worker-level data on wage rates, we show that the spread of these chains has been accompanied by higher wages.

Large chains and large establishments pay considerably more than small mom-and-pop establishments.

Moreover, large firms and large establishments give workers access to managerial ranks, and managers are a large fraction of the retail labor force, and earn about 20 percent more than other workers.

A good part of these wage gains are returns to ability – large firms and large establishments hire and promote the more able.