Walmart, the US’s largest private employer, announced to much fanfare on Thursday that it is raising the company-wide minimum wage from $10 to $11 — a move eagerly touted by President Donald Trump. However, Walmart didn’t loudly announce that it was, at the same time, moving to shut down more than 60 Sam’s Club stores nationwide and lay off thousands of workers.
Sam’s Club is a wholly owned subsidiary of Walmart, and it is named after Walmart founder Sam Walton. According to Business Insider, many of the company’s employees didn’t know they had lost their jobs until they showed up for work Thursday morning.
Following news of the mass layoffs and store closures, ThinkProgress’ Judd Legum argued the timing of Walmart’s wage announcement “was almost certainly not an accident.”
In addition to inflating the generosity of the new bonuses, Walmart appears to have launched its wage hike press blitz “to cover for thousands of unannounced layoffs,” Legum writes.
“It would look very bad to announce dozens of store closures and thousands of layoffs right after receiving a massive corporate tax cut,” he notes, referencing the $1.5 trillion tax plan Trump signed into law last month. “So instead, Walmart gave out what amounts to about two percent of the value of their tax cut over 10 years in bonuses. Made a big deal about it. Got praise from the president. Meanwhile, it was abruptly shutting stores across the country. It’s diabolical.”
“Walmart is pulling off an extremely devious two-step,” concluded George Zornick, Washington editor of The Nation.
During a press briefing on Thursday, both Treasury Secretary Steve Mnuchin and Press Secretary Sarah Huckabee Sanders were asked to comment on the mass layoffs — and on the administration’s attempt to take credit for the wage increases, but not the dozens of store closures.
“I don’t have any comment on that specific component,” Sanders said of the thousands of Sam’s Club workers who are losing their jobs.
Asked to explain why Trump’s policies are responsible for the wage hikes but not the shuttering stores, Mnuchin explained that “different companies will do different things. Some companies will invest capital, some companies will return money to workers. Lots of things are going on in the economy and we appreciate what Walmart’s doing.”
Mnuchin quickly moved on to the next question.
Here’s Mnuchin saying Trump deserves credit for Walmart wage-increase/bonuses, but not for today’s announcement that it’s shuttering hundreds of stores and laying-off thousands of workers: pic.twitter.com/zemAODumBt
— Melanie Schmitz (@MelsLien) January 11, 2018
Walmart is just the latest major corporation to carry out a massive PR campaign claiming that the GOP tax law is the driving force behind new wage increases and investments — while also firing thousands of workers.
In a statement on Thursday, Morris Pearl, chair of the Patriotic Millionaires, concluded that Walmart’s portrayal of its wage increase as a product of the Republican tax plan is “politics at its most cynical.”
“Companies were already raising wages even before the tax cut passed in response to a tight labor market, grassroots pressure from groups like the Fight for $15, and the rush of minimum wage hikes from California to New York,” Pearl said. “Take it from those of us on the inside: these companies aren’t raising pay because they want to. They’re doing it because working people stood up and demanded more.”