Evil Grocery Chains

WaPo has an interesting front page story, Grocery Workers Try to Keep the Good Life.

Mitchiner realized that his full-time colleagues at Safeway were earning as much as many of the graduates at his college. So he quit school to work full time at Safeway, a job that provided the middle-class life a college degree had promised. He and his wife, who works at a Virginia computer software company, each earn about $45,000 a year, own a two-bedroom house, two Toyota sedans and send their daughter to a $3,000-a-year parochial school.

“I realized it from the get-go,” Mitchiner said of his job. “This was a good deal.”

But what Mitchiner, now 53 and a cashier, views as a good deal, Safeway and unionized grocery stores across the country regard as a financial burden. Tomorrow, 18,000 Washington area workers at Safeway and Giant Food are to vote on a new jointly negotiated four-year contract that is expected to call for lower wages for new workers and reductions in health benefits, which the companies say they need to remain competitive with nonunion retailers such as Wal-Mart Stores Inc. If it is rejected, employees may vote to strike, disrupting business at 350 Giant and Safeway stores in the Washington area.

***

In less than a decade, the U.S. grocery industry has undergone wrenching changes. Independent regional chains in Washington, Philadelphia and Chicago have been gobbled up by big national and international companies, such as Safeway and Royal Ahold, which bought Giant Food in 1998. Today, grocery chains face a host of competitors, including Wal-Mart, bulk warehouse stores and gourmet food stores.

Consumers themselves, once loyal to their neighborhood supermarket, now shop around more in search of bargain prices and top quality. Even Mitchiner’s wife, Michelle, shops at Wal-Mart. “I can get more for our money,” she says, as her husband buries his face in his hands. Although the companies are proposing that new hires take the biggest hit, they are also asking employees like Mitchiner to accept some benefits cuts. “I resent it,” he said. “I feel I earned these wages and benefits and I started to live accordingly.”

While I can certainly feel for people facing a downgrade in their living standards because of changing market conditions, it’s unclear to me why a supermarket cashier–an entry level job at which full proficiency can be achieved in under a month–should earn wages comparable to a college graduate. Even in the inflated Washington economy, $45,000 a year with good benefits is an exceedingly high cost for work of that skill level. While it’s nice to reward longevity, supermarkets can’t afford to provide middle class lifestyles for 52-year-olds who are still doing jobs that 16-year-olds can master during holidays from school. If supermarket workers want middle class wages, they need to add value and move up into management. Indeed, it’s not unusual for high school kids to become department managers after a couple of summers working in the store.

I would also note the irony that the reporter who wrote the story almost certainly makes far less than $45,000 a year. Writing news stories is a far more challenging task than running a cash register and it’s certainly much harder to get hired by the Washington Post than by Safeway.

FILED UNDER: Economics and Business
James Joyner
About James Joyner
James Joyner is Professor and Department Head of Security Studies at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. mark says:

    When I read the $45,000 figure, I was astonished. When I moved here, I made less than that, and my benefits (health, etc) cost more than what they are getting.

    The big joke is the guy says he earned his salary because he had to memorize produce codes?? Spare me! I worked at a grocery store when I was in HS, made $4.40/hour, and memorized the produce codes in less than a week. I still remember the code for bananas (27!).

  2. You’re late to the party. California already went through this with the same blog/counter-blog entries a few months ago during our grocery workers strike.

  3. Paul says:

    There was a chain in much of the south called “The SuperStore.” It was one of the first to combine groceries with a fair amount of other household goods. The workers went on strike and management said they could not afford to pay them any more.

    The strike when on for over a year and finally the chain collapsed. Management meant it… They could not pay them any more and survive. The unions killed thousands of jobs.

    Then when the chain closed its doors the asshat union leaders got on television and declared victory!

    Why they were not pummeled but the union members around them is something I still don’t know.

  4. mark says:

    Forgive me for being ignorant on the subject, but how much do reporters make? I was under the impression that a reporter at a large newspaper (like the Wa Post) was making good money. Maybe that is because I saw an internet site that listed the average reporter salary at $65,000…

  5. Jeff says:

    The fundamental question is who deserves the money. Should the workers who sell the merchandise make the money or should the people who tell thewm to sell it make the money? I have no problem with a grocery clerk making 45k a year. If he makes more than people with college degrees, so what? Maybe those people that went to college should have thought a little more before picking their major.

    Although I am a college student myself, I don’t understand why college grads feel that they somehow deserve to make more than non-grads. If you’re pissed about the grocery guy or the auto worker making more than you, maybe you should do what he did and join a union so you can get a fair wage and decent benefits.

    Why not bring yourself up, instead of bring the grocery guy down?

  6. James Joyner says:

    Jeff: I make more than the grocery clerk.

    My argument isn’t that people with college degrees per se “deserve” more than those without. Auto mechanics, plumbers, and other skilled tradesmen make excellent wages. I’m saying that people with essentially no skills can’t expect to make those kind of wages without providing benefits that exceed that to their employer. If one can hire a high school kid with no degradation in performance–or, as is increasingly happening, have the customers scan the items themselves!–then it’s not a high value added job.

    Unions don’t create value. Simply demanding wages only works if there’s no competition from non-union labor and it’s a non-elastic good. Those conditions don’t apply here.

    Mark: I’m not sure about that particular reporter. But entry level is in the low ’30s, from what I understand.

  7. Nick says:

    “Deserves the money”? Is this the mindset our colleges are instilling these days?

  8. Kevin Drum says:

    This article certainly piqued my interest. Here in Southern California we are all experts in grocery clerk wage scales these days, and the top pay is about $37,000. That’s for somebody working full time, who has years of seniority, and who manages a department. The average cashier makes more like $25-30,000.

    I wonder what the difference is? SoCal is obviously a high cost of living area, so it’s not that. It seems very odd that the difference would be so great.

  9. Joe Baby says:

    I wish one of the frequent responses to these type of unfortunate stories (certainly unfortunate for the workers who are going to be facing a pay cut) was, ‘hey, why not ditch this corporate crap and go work for myself?’

    The general response, however, is ‘Big Greedy Corporation Pounds Helpless Individual–Again’.

    And that’s reason I’m still a big fan of legal immigration…ever seen how many of them open their own business?

  10. James Joyner says:

    Kevin,

    The only thing I can think of is lack of competition here. I’m not sure what the situation is in SoCal, but there were apparently just two stores–Safeway and Giant–with a significant presence here until recently. Even the Wal-Marts around here are pitiful.

  11. Brian J. says:

    Back ten years ago, when I got out of school, I went to work for a small Missouri chain with a union contract in place. I remember one of the checkers telling me that she was making over ten dollars an hour. The way it was explained to me: after a certain number of hours worked, you got a nickel raise; after another span, you got a dime raise; after another span, twenty cents, and that it doubled like that for some time. After a number of years, this checker was pulling in $21,000 a year.

    She knew that she couldn’t make that anywhere else, so she was stuck like a serf owned by both the store and the union.

    Me, I came in with four years’ of perimeter department experience (produce) and started at the minimum for the store, $4.85 an hour. It’s heartening to know that a hard worker with experience would always be lower on the pay scale than the high school dropout who was hired a month before me.

    I never did make it to the nickel raise. And the chain’s out of business.

  12. Nash says:

    My sister pointed out during the Southern California grocery worker’s strike that customer service at the supermarkets really took a dive. Can’t find an item on the shelves? Neither could the low-wage temporary workers.

    I don’t care how cheap Walmart’s prices are. I won’t shop there because I hate the poor customer service they have due to their low wages and high rate of employee turnover. But if the supermarkets think they can compete in price with Walmart by sacrificing customer service then they are shooting themselves in their own foot.

  13. More important: we don’t know what the permanent damage was to the supermarket chains. A lot of people switched over to Trader Joe’s, independent grocery stores, butcher shops, bakeries, and their local farmer’s markets for produce.

    It’ll be interesting to see how many people come back.

  14. danielle says:

    I have worked with Albertson’s in Washington State for two years and I am looking for a promotion from courtesy clerk to produce clerk. I would love to be a checker, once you have worked a certain amount of hours, your pay increases. A manager makes the same as a journeyman checker in the front end dept. For example, my boyfriend also works for Albertson’s and makes the same $16.28 per hour that the checker whose been there for like 20 years and who still hasn’t applied for a management position. The only benefit of being a manger is guaranteed hours. You never have the same shifts in a week and never are guaranteed the money. Each dept. in the store is on their own pay scale. Produce happens to be on the same pay scale as checker – bonus, however the other job I am going for max. out at $8.00 and as a courtesy clerk I have max. out at $7.52. It’s a job for people in college, people working towards a goal. It is looked down upon to be a “lifer”. If grocery is your passion, then that’s different, but if you just applied and got the job and have just never moved on – that’s sad. I have goals, and they are not to be making $16.28 for the rest of my life. It’s to be pulling in at least $60 grand a year as a Marriage Family Therapist. For my boyfriend, he would love to be a teacher – salary depending on the state we decide on. It’s not a great job, but it’s pretty good pay and benefits for a couple of kids trying to get by on some top ramen and cup of noodles!

  15. Kalblog says:

    I’m In The Wrong Industry
    $45,000 for a grocery store clerk? All my sympathy for Safeway employees just dried up. The fact is, that’s twice what most entry-level people in politics get, despite the fact that the latter group is made up of college graduates…