By Daniel Parsons and Wenzday Jane
Three years ago, we helped launch Somerville Local First, with the goal of building a strong local economy that would enable independent businesses to thrive, create high-quality jobs, and move us toward a more sustainable future. Since then, more than 200 local businesses, community non-profits, artists, and citizens have joined our effort.
We believe that nurturing local enterprises offers the best path to a prosperous and sustainable economy. That's why Somerville Local First has decided to oppose Wal-Mart's proposed expansion into our city.
Across the country, other regions are moving in a similar direction. The results are promising. The number of small farms and farmers markets has grown dramatically in recent years. Neighborhood retailers are showing signs of a comeback. More than 400 new independent bookstores and 1,400 small locally owned food markets have opened since 2002. Community banks and credit unions have likewise seen a surge in deposits.
Here in Somerville, many of our members' businesses are growing, despite the challenging economy, as residents increasingly seek out locally owned, independent businesses.
Although Wal-Mart has proposed only one store so far, we expect that the company's long-term plans for Boston and surrounding communities are similar to what it has put forward in other cities. In Chicago, for example, Wal-Mart has said it wants to open dozens of stores, ranging from giant supercenters to smaller neighborhood markets. Using this aggressive expansion strategy, Wal-Mart has become the largest grocer in more than 100 cities. In 29 of those markets, Wal-Mart controls more than half of all grocery sales.
If Wal-Mart were allowed to become the dominant retailer here, it would undermine the economic health of our region. Research shows that Wal-Mart pushes out local businesses, reduces employment and forces more families into poverty.
A study by researchers at Loyola University found that, two years after a Wal-
Mart store opened on Chicago's West Side, more than 80 local businesses within a four-mile radius (nearly one-quarter of the total) had closed and about 300 people had lost their jobs.
That Wal-Mart stores cause job losses was also the conclusion of a study by the University of California, which tracked Wal-Mart's expansion across 3,000 counties. The study found that the opening of a Wal-Mart store resulted in a net loss of 150 jobs on average. For every 5 people hired at a new Wal-Mart store, the results showed, 7 people lost their jobs at existing businesses.
Economists have also found that Walmart's arrival reduces wages and exacerbates poverty. According to a study by Stephan Goetz, an economist at Pennsylvania State University, counties that have more Wal-Mart stores have higher poverty rates (even after accounting for other factors that contribute to poverty).
Many Wal-Mart employees must rely on public assistance. Here in Massachusetts, nearly 5,000 Wal-Mart employees were enrolled in MassHealth,as of 2008 (the most recent data available), at a cost to taxpayers of $15.5 million a year.
Even as the evidence mounts of the harm Walmart does to local economies, other research has found that choosing the opposite path yields many benefits. For example, communities that are home to lots of small, locally owned businesses have experienced significantly higher income growth than those whose economies are largely in the hands of big out-of-state companies.
We should keep this data in mind over the coming months as Wal-Mart ramps up its public relations campaign in Somerville, Boston, Roxbury and other communities. The company will likely appeal to our need for jobs and economic growth. But the evidence strongly suggests that Wal-Mart would actually eliminate jobs, increase poverty, and leave residents with less competition and fewer choices about where to shop.
In Somerville, we'll be making the case that Wal-Mart does not fit our community's vision and, if want to build a prosperous and sustainable future, we must focus instead on growing our local economy. We hope people from across Greater Boston will join us.
Daniel Parsons is president of Somerville Local First.. Wenzday Jane, owner of Metro Pedal Power is a member of Somerville Local First.